If an employer offers to reinstate an employee claiming wrongful dismissal, is it fair to expect the employee to accept?
By Jeffrey R. Smith
In employment law, there are many bad situations that have to be sorted out. Sometimes they’re created by malicious employers and sometimes by irresponsible employees. In certain instances, the cause could be a mistake or misunderstanding. If it’s the employer that made the mistake, there could be an opportunity to correct it before things get out of hand.
There are differing thoughts on whether employers that are faced with wrongful dismissal suits can simply offer fired employees their jobs back.
A recent federal adjudication involved an employee for a First Nations band who was dismissed after an acrimonious relationship with her manager that involved insubordination and a complaint against her manager that that the employer deemed retaliation for a verbal warning. After she was fired, the worker filed a constructive dismissal complaint with allegations of bullying and harassment.
The employer responded by offering the worker her job back with the same pay so all could move on. However, the worker declined the offer, accepted a temporary job with another employer, and pursued her complaint seeking compensation for lost wages for up to two years.
An adjudicator noted that federally regulated employees cannot be dismissed without cause under the Canada Labour Code, so the worker’s dismissal was unjust. However, though the working relationship was dysfunctional, it wasn’t serious enough to create a toxic work atmosphere.
The adjudicator found that the offer of reinstatement was reasonable and “would have effectively resulted in no employment-related disadvantage” to the worker had she accepted. As a result, the wrongful dismissal damages only amounted to six weeks’ pay — from the date of her dismissal to the date she officially declined the offer of reinstatement. See Bai and Tsay Keh Dene Nation, Re (June 30, 2019), Doc. YM2707-11450 (Can. Lab. Code Adj.).
Two sides to equation
In the case above, the adjudicator found it reasonable to expect the worker to return to work, despite the poor relationship she had with her manager. In such circumstances, the viability of the worker returning to the same workplace in the same position depends on how bad things are and the court or arbitrator decides whether the employment relationship can still work.
There are notable decisions over the past few years showing both sides of the equation.
A few years ago, the B.C. Court of Appeal found that an employee was justified in refusing a re-employment offer the employer made because the offer didn’t include full compensation for lost wages since her dismissal, and the employer breached her trust by discussing the matter with another employee. It was unreasonable to expect the worker to be able to continue working for that employer. See Fredrickson v. Newtech Dental Laboratory Inc., 2015 BCCA 357.
A well-known decision in this area is the 2008 Supreme Court of Canada decision Evans v. Teamsters, Local Union No. 31, 2008 SCC 20. An employee of a labour union was terminated after the union elected a new executive whom he bitterly opposed. Negotiations for a settlement agreement were unsuccessful, so the union told the employee he would have to come back and work out the remainder of his 24-month notice period.
The employee refused and the Supreme Court found the union’s request for him to return to work was reasonable — overturning a lower court decision that backed the employee’s decision. The top court found that the working conditions, salary and benefits were the same and would have mitigated the employee’s losses from his termination.
“In some circumstances it will be necessary for a dismissed employee to mitigate his damages by returning to work for the same employer,” the Supreme Court said in Evans. “Assuming there are no barriers to re-employment, it is consistent with the notion that damages are meant to compensate for lack of notice, and not penalize the employer for the dismissal.”
But if there has been any level of acrimony in the workplace, returning a dismissed employee to that workplace could be problematic — especially when you add the extra stress and potential bad feelings the stem from the dismissal itself. It can be a challenge to continue the employment relationship in such circumstances. Is it reasonable to expect a fired employee claiming wrongful dismissal to accept an offer to come back, or is it too much to ask?