Once an employee’s employment is terminated, the person is required to mitigate by seeking alternative employment. What happens if your former employer offers to give you your job back? Are you required to accept this offer as part of your duty to mitigate? If so, and you don’t accept the offer then you should know that a court can conclude that you are not entitled to any further wrongful dismissal damages.

Frederickson v Newtech Dental Laboratory Inc.

The Facts

In this from British Columbia, Ms. Frederickson had worked for Newtech Dental as a dental technician assistant for eight and one-half years. For the most part, Ms. Frederickson and Newtech’s owner, Mr. Ferbey, had a good working relationship. In 2010 and 2011, Ms. Frederickson was under significant stress due to family problems which were known to Mr. Ferbey. In April 2011, Ms. Frederickson took a medical leave of absence. Although she did not discuss the medical leave with Mr. Ferbey beforehand, the trial judge found there had never been any issue with her taking medical leave if she needed to.

While Ms. Frederickson was away, Mr. Ferbey disputed her right to have taken a medical leave. In July 2011, Ms. Frederickson’s doctor cleared her to return to work. When Ms. Frederickson reported for work, Mr. Ferbey informed her she was laid off because of insufficient work.

In September 2011, Ms. Frederickson hired a lawyer and sent a demand letter to Newtech. Newtech responded by directing Ms. Frederickson to return to work. In October, the employer made another offer to re-employ Ms. Frederickson, and offered to pay her unpaid wages from July to the date she was invited to return to work in September. The employer made similar offers on three different occasions. Ms. Frederickson declined all the offers of re-employment, saying Mr. Ferbey’s relationship had broken their employment relationship and that it was reasonable for her to decline returning to work considering how small the workplace was (five employees total).

The Decision

The trial judge concluded that it would have been reasonable for Ms. Frederickson to accept the offers of re-employment as part of her duty to mitigate. Therefore, Ms. Frederickson had failed to mitigate her damages and was only entitled to damages for the period between July and September 2011.

On appeal, Ms. Frederickson argued that the trial judge erred when he failed to place any weight on Mr. Ferbey’s bad faith: for example, Mr. Ferbey surreptitiously recorded two conversations with her. The Court of Appeal agreed, finding that the trial judge had erred in failing to give significance to: (1) the incomplete nature of the offer (i.e. the fact that the employer’s offers would not have made Ms. Frederickson whole as they only compensated her to September 2011), (2) the incompatibility between the parties given their disagreement over whether she was dismissed and (3) the fact that Ms. Frederickson’s trust in her employer had been eroded by her employer’s behaviour.

Lessons to be Learned

Dismissed employees are expected to be reasonable in their search for alternate employment, including offers from their former employer. Depending on the circumstances, it may be reasonable for an employee to accept such an offer. Therefore, it is important to consult a lawyer to know what your obligations are after termination.

If you have any questions about your legal rights in the workplace, one of our lawyers would be happy to meet with you. Please call 647-204-8107 or email [email protected].