Mechanic called it quits too soon after plant closure

Engineer not entitled to severance pay after jumping ship

Len Smith, a mechanic in British Columbia, was not entitled to severance pay after he quit following notice of his operation’s closure.

Smith initially sought alternative employment when his employer, Thermo King, informed employees of its plan to permanently close the operation in Kelowna, B.C. Smith immediately began looking for work elsewhere and found a position at James Truck & Trailer repairs.

The International Union of Operating Engineers (IUOE), however, said Smith was entitled to severance pay as per the collective agreement. The union said Smith was entitled to 17 weeks’ pay because the employer closed its Kelowna branch and therefore caused the grievor to lose his employment.

It said the severance provision provided for an earned entitlement based on past service.

Thermo King took the position that it did not terminate or close its operation in Kelowna, but that its expressed intention was to continue the mobile service operation as-was for at least another year.

However, when Smith called to say he had been offered a job with James Truck & Trailer Repairs, any severance option was forfeited.

The employer understood that Smith had, by definition, quit and alternatives would need to be found to fill the need for customers in Kelowna.

The question at the centre of the award, therefore, was to determine whether there was a permanent closure of a department that caused the employee to lose his employment with the employer.

Smith's supervisor said he did not give the employee any direction that he should work for anyone else. The employee was a great mechanic, his quality of work was not in question and Thermo King had no reason to get rid of him, the employer added.

Arbitrator weighs in

Arbitrator Heather Laing called the circumstance unusual, and said the severance pay article did not apply to the grievor’s situation. He did not lose his employment with Thermo King because of any of the conditions set out in the collective agreement, and in fact rejected the offer to continue working out of Coquitlam.

"The difficulty for the grievor in this arbitration is that he did not ‘lose’ his employment because of any action or conduct of the employer," Laing said.

"He chose to reject the employer’s alternative offers…he sought out and accepted employment with a new employer, who in turn began to service Thermo King customers, using the grievor’s skills."

The grievor made a clear choice, she added, and therefore dismissed the grievance.

Reference: Thermo King of British Columbia and the International Union of Operating Engineers (IUOE) Local 115. Heather Laing — arbitrator. Don Watts for the employer, Brandon Quinn for the union. Nov. 2, 2015.

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