Laying off a worker is not wrongful dismissal in Alberta

Vrana v. Procor Ltd. [2003] A.J. No. 131

George Vrana sued Procor for wrongful dismissal. Vrana had been continuously employed by Procor since 1984 without a written employment agreement.

On March 20, 2000, Procor told Vrana that he was laid off due to a lack of work but they would notify him of a recall when the situation improved. During the period of layoff, Vrana started a wrongful dismissal claim against Procor, stating he had been constructively dismissed.

Procor subsequently paid Vrana his termination pay pursuant to the Alberta Employment Standards Code. At trial the judge accepted evidence that the Procor layoffs originally started in 1999 and that Vrana was the last employee at his location to be laid off.

The judge held that under sections 62 and 63 of the code, an employer has the right to temporarily lay off an employee for no more than 60 days without terminating their employment.

Before this legislation was in force, at common law an employee would have been terminated without cause if they were laid off unless there was a specific contractual agreement allowing the employer to lay off employees.

Section 62 of the code allows employers in Alberta to maintain the employer-employee relationship even though the employee is temporarily laid off. Therefore, the judge found that Vrana was not constructively dismissed when he was laid off. This significantly affected Vrana’s claim.

The judge said that because his employment was ongoing, Vrana’s action for wrongful dismissal was inconsistent with his employment relationship and, thus, in bringing the action he had repudiated his contract with Procor.

As Vrana had breached his employment agreement by bringing the wrongful dismissal claim, the judge found in favour of Procor. The layoff of Vrana did not result in his termination and therefore his claim for wrongful dismissal was dismissed.

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