Employee didn’t ‘look before he leapt’

Employee should have consulted on his new pay before walking away: Court

An Ontario employee who didn’t like his new boss and quit over changes should have checked the facts before he made any assumptions, the Ontario Superior Court of Justice has ruled.

Joe Pede, 53, worked for Plaza Pontiac Buick GMC, an automobile dealership in Toronto, as director of finance and operations. Plaza was the latest in a string of employers for which he had worked over nearly three decades, but most jobs didn’t last long as he often left over pay disagreements, termination or other opportunities.

In the summer of 2006, Plaza hired a new general manager. Pede had a rocky relationship with the new manager and in November 2006 he was fired. However, this was immediately rescinded and Pede rejoined the dealership under a new arrangement. This new arrangement was governed by a signed agreement that made Pede the general manager of another dealership owned by Plaza’s owners in addition to his role as director of finance and operations for Plaza. The agreement was set to be in effect for one year.

However, Pede became unhappy in January 2007 when the owners appointed the general manager of Plaza to oversee day-to-day operations of the other dealership. The owner wanted to step back from the business and wanted the Plaza general manager to “act as his designee.” However, Pede didn’t like the idea of reporting again to this man because of their acrimonious reporting relationship at Plaza. He was also told he would no longer be working at Plaza, but at the other dealership only, and was ordered to stay away from Plaza and its employees.

Pede thought his compensation would be reduced without the Plaza part of his job, after talking to the secretary, and decided to resign, though the owners intended to absorb his total compensation into the other dealership without reducing it. He worked the next day but didn’t confirm the salary restructuring with the general manager. At the end of the day, he cleaned out his desk and left.

The next day, Jan.7, 2007, Pede wrote a letter to the owners accusing them of subjecting him to “lies, slander, humiliation and having remuneration changed without proper discussion.”

Pede sued both Plaza and the other dealership for constructive dismissal. Plaza denied it demoted or reduced his compensation and argued Pede had essentially resigned his position by constantly “bargaining, negotiating and demanding greater compensation.”

The court found Pede should have taken steps to confirm his suspicion about his pay, since his total salary wasn’t actually changing. The moving of his duties fully to the new dealership didn’t constitute a fundamental change in his duties, either, so there was no constructive dismissal. He chose to leave on his own, said the court.

“It was clear from the testimony that Pede’s ego could not accept working for (the other dealership) only, that he did not like having to report as general manager to (his old boss from Plaza), the new group head, and that he jumped to the conclusion that (the owner) intended to reduce his compensation,” said the court. “Pede failed to make proper inquiries and to ‘look before he leapt.’ His decision to leave is a resignation without good reason for which the law accords no compensation.”

See Pede v. Plaza Pontiac Buick GMC Inc., 2011 CarswellOnt 465 (Ont. S.C.J.).

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