Supreme Court rules on employer’s obligations when employee gives notice of termination

An Quebec employer must provide notice of termination to an employee who has provided a notice of resignation if it wants the employee to be gone sooner than the employee's resignation date, the Supreme Court of Canada has ruled.

On July 25, 2014, the Supreme Court overturned the judgment of the Quebec Court of Appeal in Québec (Commission des normes du travail) c. Asphalte Desjardins Inc.The employee in question had been working for his employer since 1994. On Friday, Feb. 15, 2008, he gave his employer a notice of resignation in which he announced that he intended to terminate his contract of employment as of March 7, 2008 — three weeks later. On Monday, Feb. 18, the employer decided to terminate the contract of employment the very next day, rather than on March 7, 2008.

The commission claimed, on behalf of the employee — who, in accordance with the Quebec Act Respecting Labour Standards (ALS) was entitled to eight weeks' notice of termination considering his years of service — an indemnity equivalent to three weeks' notice, consistent with the notice of termination the employee had given in his letter of resignation, as well as the monetary value of the annual leave, in the same proportion. The Court of Québec found in the commission's favour, but the province's Court of Appeal ruled against it.

This appeal raises the issue of the interplay of the provisions of the Civil Code of Québec (C.C.Q.) and the ALS relating to the effect of the notice of termination. The Supreme Court has confirmed that a contract of employment is not automatically terminated upon receipt of a notice of termination. On the contrary, the contractual relationship continues until the date set out in the notice of termination given by the employee or the employer. As a result, an employer who receives from an employee the notice of termination provided for in Article 2091 of the C.C.Q. cannot unilaterally terminate the contract of employment for an indeterminate term without fulfilling its own obligations regarding termination of employment. If the employer refuses to allow the employee to continue working during the notice period, it is deemed to terminate the contract within the meaning of s. 82 of the ALS and is liable for payment of an indemnity in lieu of notice.

Once notified of the date on which an employee wishes to leave his employment, an employer who objects to the employee continuing to work during the notice period may either: in turn give notice of termination or pay an indemnity in lieu of notice in accordance with the C.C.Q. and ss. 82 and 83 ALS; or ask the employee not to return to work, while continuing to pay him during the notice period. The Supreme Court has drawn a distinction between the situation in Asphalte and the case where an employee notifies his employer that he intends to resign immediately, but offers nevertheless to stay on for a certain period of time. In the latter, if the employer indeed wants the employee to leave immediately, there is a meeting of minds and notice of termination is unnecessary, given that a contract for an indeterminate term may be terminated by agreement between the parties.

For more information see:

• Québec (Commission des normes du travail) c. Asphalte Desjardins Inc., 2013 CarswellQue 8504 (S.C.C.).

This article was written by the Labour and Employment Group of McCarthy Tétrault in Montreal. The firm can be reached at (514) 397-4100 or [email protected].