'It's appropriate to consider anything that had an impact on the availability of similar employment'
The effects of the pandemic on a worker’s job search following her termination of employment warrant a bump in her common law reasonable notice entitlement, the New Brunswick Court of Queen’s Bench has ruled.
While the jurisprudence is mixed on whether wrongfully dismissed workers should get such a bump, employers have the ability to make such a question moot when the workers are initially hired, says Anne Amos-Stewart, an employment lawyer with McInnes Cooper in Moncton.
“An ounce of prevention is worth a pound of cure – it’s essential for employers to have a written employment agreement with a clear and unambiguous termination clause limiting an employee’s entitlements on termination, in order for an employer to properly protect themselves from liability,” says Amos-Stewart. “The lack of such a clause in [this] case is what ultimately paved the way for the costly judgment against the employer.“
Andrea Miller, 56, was hired as a marketing officer for Fredericton-based biotechnology company Luminultra Technologies in 2014. She had nearly 25 years of marketing experience at the time and she was eventually promoted to the role of strategic marketing manager.w
Read more: An Ontario court recognized the impact of the pandemic on a worker’s job search but was hesitant to give it significant weight in the reasonable notice calculation.
On May 27, 2020, Luminultra terminated Miller’s employment without cause. The company provided her with six weeks’ severance and, near the end of the six-week period, it increased her severance to six months’ pay.
After her termination, Miller conducted a steady search for alternative employment, applying and interviewing for several positions. However, she was unsuccessful and she decided to start her own business. She also filed a wrongful dismissal claim for pay in lieu of common law notice, followed by a motion for summary judgment on the basis that her reasonable notice entitlement could be determined without a full trial.
Miller and her counsel raised what they called “a novel issue” – that the COVID-19 pandemic should be factored into her reasonable notice entitlement, as she was terminated just over two months into it. The economic uncertainty created by the pandemic along with government-imposed lockdowns should push towards a longer notice period, she argued, calling this the potential to make “new law.”
Both Luminultra and the court agreed that the matter could be fairly adjudicated in a summary judgment.
Bardal factors
The court noted that reasonable notice entitlement was governed by the principles that employment was an essential component of a person’s self-worth and the primary objective was to provide the terminated employee with a reasonable opportunity to seek and find alternative suitable employment. As a result, wrongful dismissal damages should place the employee in the same position they would have been in had the employee worked and received pay during the notice period, said the court.
The court disagreed with the characterization that the pandemic’s effect on reasonable notice entitlement was new law, preferring to include the pandemic’s impact on the labour market as “merely an extension of one of the factors the court is directed by Bardal to consider: availability of alternative employment.”
The court found that there was no evidence of the specific impact of the pandemic on Miller or her job sector, but there was “little doubt” that it affected her ability to find new employment and was one of several factors to be considered in assessing reasonable notice, said the court.
Evidence lacking
Amos-Stewart thinks it could be concerning for employers that the court concluded there was “little doubt” that the pandemic affected Miller’s job search, even though there wasn’t much evidence in that regard – which the court conceded.
“Evidence with respect to the effect of the pandemic in a particular case should absolutely be required for it to have any impact on the reasonable notice period,” says Amos-Stewart. “In this case, the court may have been swayed by the employee’s evidence of the extensive and unsuccessful efforts the employee made to find new employment, but of course there could have been reasons other than the pandemic why she didn’t find another job.”
The court added that Miller’s termination in the early part of the pandemic, when it was uncertain how long the uncertainty would be, tended to tilt reasonable notice towards a longer range. Considering Miller’s age, experience, six years of service, and the availability of alternative employment – which was negatively impacted by the pandemic – the court determined that Miller was entitled to reasonable notice of 10 months.
Luminultra was ordered to pay Miller 10 months’ pay in lieu of notice.
Read more: The pandemic should not be considered a factor in reasonable notice for an employee who was terminated before it started, according to the Ontario Superior Court of Justice.
While the court in this case determined that the pandemic’s effects should increase the notice period – the average reasonable notice awarded in similar cases raised by the parties was eight months – there is no standard rule courts are applying, according to Amos-Stewart.
“There are cases that go both ways – it just depends on the evidence and the particular circumstances of the case,” she says. “For example, in New Brunswick, there was another case last year (Donovan v. Quincaillerie Richelieu Hardware LTD., 2021 NBQB 189) where the court found that the pandemic was a factor in assessing the reasonable notice period.
“Contrast that with the Ontario case of Marazzato v. Dell Canada Inc., 2021 ONSC 248, where the court found that, due to a lack of evidence that the pandemic presented an obstacle to finding new work, the pandemic did not serve to lengthen the notice period.”
Given that the court treated the pandemic as just another factor contributing to the standard consideration of availability of alternative employment, it’s a reminder for employers in any wrongful dismissal action to provide evidence about the availability of similar employment if they take a position pushing for the lower end of reasonable notice entitlement, says Amos-Stewart.
“Employers should be alive to any arguments that the pandemic had no impact or even a positive impact on the relevant job market — such as for cleaning and information technology positions, for example,” she says.
However, even if the pandemic is factored into the calculation of reasonable notice, it rarely provides a significant bump.
“I think it’s in line with existing case law and appropriate to consider anything that had an impact on the availability of similar employment – good or bad – in a given case, including the pandemic,” says Amos-Stewart. “But the fact of the pandemic in and of itself shouldn’t automatically mean anything for the notice period, and the impact – if any – of the pandemic on a particular job market shouldn’t be given undue emphasis.”
See Miller v. Luminultra Technologies Ltd., 2022 NBQB 060.
