This past year, the courts have left us with important decisions about employment contracts, constructive dismissal, severance, just cause and the oppression remedy.
This article is a short summary of some important employment law decisions in Alberta in 2022, separated roughly into subcategories of employment law. This article does not focus on cases from other jurisdictions, although many of those can have persuasive weight here. It also does not address developments in human rights and labour (union) law, because to do so would make the article more than twice as long as it already is!
In Lawton v Syndicated Services Inc, 2022 ABPC 3, the Alberta Provincial Court upheld an employment contract which provided 4 weeks of severance upon termination of employment of an employee. This case is a bit unusual. Based on other cases, I think the Court in this case could have found the clause violated the Employment Standards Code. The Court could have then struck out the clause to provide additional severance to the employee. Instead, the Court seemed to focus on the fact that this was a small “mom and pop” business that was losing money at the relevant time.
In Bryant v Parkland School Division, 2022 ABCA 220, the Alberta Court of Appeal found the following clause was not clear and unambiguous enough to limit the employee’s entitlement to reasonable notice severance:
This contract may be terminated by the Employee by giving to the Board thirty (30) days or more prior written notice, and by the Board upon giving the Employee sixty (60) days or more written notice.
This case is not particularly ground-breaking, but it does reaffirm established principles of contractual interpretation which tend to favor the employee.
In Kosteckyj v Paramount Resources Ltd, 2022 ABCA 230, the Alberta Court of Appeal found the employer breached the employment terms by unilaterally reducing the plaintiff’s compensation. However, the Court decided it was not a constructive dismissal because the plaintiff – a professional employee – did not protest that reduction and resign or claim constructive dismissal more than 10 days after the reduction. It is well-established that a plaintiff must decide whether to pursue constructive dismissal within a “reasonable time” after an employer breach, but 10 days is shorter than what we usually see in the caselaw.
In Benke v Loblaw Companies Limited, 2022 ABQB 461, the Alberta Court of Queen’s Bench found an employee who was put on unpaid leave for refusing to wear a mask at work and then resigned was not constructively dismissed. The judge reasoned that Loblaw’s requirement for the employee to wear a mask in its stores was not a substantial change to his job duties and therefore did not breach his employment terms. This case is significant because many employees across Canada were placed on unpaid leave for similar reasons. Until recently, there was very little guidance in the caselaw on whether that could qualify for constructive dismissal.
In Hubbard v 651398 British Columbia Ltd., 2022 ABPC 22, the Alberta Provincial Court found an employer and employee had a verbal severance agreement. The employee agreed to take valuable tools and materials from the closing-down employer instead of cash severance. The Court found this was a valid form of severance, and the employee was not entitled to additional cash severance.
In Oostlander v Cervus Equipment Corporation, 2022 ABQB 200, the Alberta Court of Queen’s Bench awarded a terminated employee 24 months of reasonable notice (severance). This was despite the employee knowing for 16 months prior to the termination date that his employment was ending. The Court also deducted CERB benefits he had received since termination from his severance award. The case is important mostly because 24 months is generally the most severance an employee can get, and there are relatively few cases with awards in that range.
In Baker v Weyerhaeuser Company Limited, 2022 ABCA 83, the Alberta Court of Appeal found an employer did not have just cause to dismiss an employee, despite proven performance issues and employee dishonesty. This is a significant case, because although courts take into account the context of dishonesty, often dishonesty alone is enough for just cause. In this case, the Court was concerned the employer’s actual motivation for discipline and termination was a manager’s private vendetta against the plaintiff employee.
In Wisser v CEM International Management Consultants Ltd, 2022 ABQB 414, the Alberta Court of Queen’s Bench allowed a dismissed employee to use the “oppression remedy”. The employee secured a severance award directly against the directors of the corporation he previously worked for, as well as against a third-party corporate entity that had purchased the assets of the prior employer after termination of employment. It is rare for an employee to be able recover severance against third parties and directors.
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The information in this article was correct at time of publishing. The law may have changed since then. The views expressed in this article are those of the author and do not necessarily reflect the views of LawNow or the Centre for Public Legal Education Alberta.
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