Cutbacks, not heart attack, killed VP’s job

Exec felt left out of decisions after return to work but higher-ups were dealing with financial trouble

An executive who felt he was pushed out of his job after a heart attack was fired because of cutbacks, the Ontario Superior Court of Justice has ruled.

Phil Dwyer, 53, was hired on March 31, 2004, by market research firm Advanis to be its vice-president, business development in Toronto. Dwyer signed an employment contract that stipulated if he was terminated because “there is not a fit between your skills and the requirements of the job” he would receive severance according to the Ontario Employment Standards Act.

In 2006, Dwyer’s job responsibilities shifted from being sales-oriented to marketing. Advanis sent a letter to the federal government outlining this change, as Dwyer was a British citizen and a change in his employment required government approval. The letter stated Dwyer had “demonstrated the exceptional skill sets and unique experience necessary for this new position.”

Felt excluded after return from heart attack

On June 11, 2007, Dwyer had a heart attack. The doctors told him he had to be off work for six to eight weeks and then work shorter hours because he would be fatigued. He was given medication, stress management advice and a special exercise program. He also had to take time off regularly for medical tests and appointments.

Advanis told Dwyer it would do whatever it could to support his recovery. It paid for medication that wasn’t covered by his drug plan and paid his salary while he was off, even though the company didn’t have short-term disability benefits. It also supported him working shorter hours.

Dwyer returned to work after only four weeks, but found things had changed at the office. Advanis executives didn’t communicate with him and he was excluded from decisions he had been involved in previously. He reluctantly went on a vacation but when he came back and tried to catch up on work issues with his mentor, who was an Advanis executive, his attempts at communication weren’t returned.

Dwyer’s mentor finally contacted him on Oct. 27 and scheduled a dinner meeting with him. By this point, Dwyer was nervous about his status with Advanis and suspected he might be fired.

No role after company made cuts

The executive told Dwyer the company had lost $1 million in the past year, its worst ever. Advanis executives were absorbing sales and marketing responsibilities to cut costs and this would leave no one for Dwyer to supervise. He was told his current role could not continue but Advanis might be able to keep him on as an independent contractor.

Dwyer was surprised at the news, since he didn’t think things were that bad. He knew of a new project underway that was expected to generate significant revenue for the company as well as other plans to increase sales, which seemed inconsistent with the bad news. He was not happy but kept quiet.

A few days later, Dwyer was given a letter of termination effective Nov. 2. Dwyer was concerned about the terms, which said his benefits would stop on that date. He also disagreed with the calculations for his unused vacation, statutory minimum notice period and four weeks’ statutory severance.

Dwyer expressed his concerns and the executive told him to “tear up” the letter and he would send him a new one, along with an independent contractor proposal. However, a few days later he received a letter that was largely the same as the one he refused. Dwyer was upset and felt betrayed. After attempts at negotiations failed, the CEO suggested Dwyer request an extension so they could continue to try to work out an extension of his benefits. Dwyer consulted legal counsel who sent a letter to Advanis detailing his demands. Advanis took offense at the “threatening” letter and cut off discussions.

Dwyer responded by accusing Advanis of violating an implied term of the employment contract for reasonable notice and acting in bad faith in the manner and reason for his dismissal, claiming his heart attack was a contributing factor.

Termination provision didn’t apply to firing for financial reasons

The court found Dwyer was not terminated because of his skills but rather for financial reasons, so the termination provision, which only applied if his firing was related to his skill set, wasn’t applicable. The court said Advanis hadn’t lived up to the statutory requirement of maintaining benefits for the four-week notice period either, so it in fact breached its own contract provision confirming the statutory minimum.

“The written employment contract does not oust or limit an implied term created by common law requiring ‘reasonable notice’ for the termination of (Dwyer’s) employment,” the court said.

No bad faith in accommodation or dismissal

However, the court found Advanis did accommodate Dwyer after his heart attack by paying his salary and allowing him to return gradually. Its offer of contract work was also a way to help him until he found a new job, the court said. The company was also straightforward about the reason for his dismissal and the “accusatory and inflammatory” letter from Dwyer’s lawyer was a legitimate reason for cutting off negotiations.

The court ruled Advanis should pay Dwyer 12 months’ notice minus the four weeks’ severance he was paid upon his firing, with no additional damages. See Dwyer v. Advanis Inc., 2009 CarswellOnt 2610 (Ont. S.C.J.).

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