What kind of damages are you entitled to if your employer makes frivolous allegations about you?

Aug 22, 2017

As we have written before, an employer may generally terminate an employee for any good business reason as long as it provides the employee with adequate notice of termination (or pay in lieu of this notice). Failure to provide adequate notice results in a wrongful dismissal. However, if an employer has ‘just cause’ for the termination, then the employer does not generally need to provide the employee with any notice of termination.

In addition to awarding damages for wrongful dismissal, courts have the authority to award “aggravated” or “moral” damages, and “punitive” damages, in certain circumstances (see here for some examples). A recent case from Alberta provides a good example of when these kind of damages may be awarded by the courts.

Lalonde v Sena Solid Waste Holdings Inc.

During Mr. Lalonde’s 4-year employment with Sena Solid Waste Holdings (“the Company”), he did not have a disciplinary history. One day, he was summoned for a meeting with his manager where he was accused of lying, being insubordinate, and “putting a life in danger” because a contract worker was working without a permit that day. Mr. Lalonde tried to respond to the allegations but was given little, if any, opportunity to do so. Mr. Lalonde was suspended and escorted out of the workplace by two other employees.

During Mr. Lalonde’s suspension, he attempted to contact his employer to communicate his side of the story. He did not hear anything from the employer for several weeks. The period of time during which he was suspended was difficult, and his doctor sent him on stress leave.

The employer did not respond to Mr. Lalonde’s request for more information, despite the fact that they were aware the Plaintiff was under stress. Approximately five weeks after he was suspended, Mr. Lalonde received a letter advising that his employment had been terminated for cause due to his failure to follow safety procedures and failure to follow his supervisor’s instructions.

As a last resort, Mr. Lalonde sent a letter to the employer providing his response to all of the allegations. In response, the Human Resources Manager sent Mr. Lalonde an email with a list of policy violations, which was copied to a number of senior employees.

Mr. Lalonde brought a wrongful dismissal action for pay in lieu of notice and aggravated damages. On the first day of trial, the employer withdrew the frivolous allegations of clause.

Decision

Taking account Mr. Lalonde’s age at dismissal (56), the nature of his employment (a tradesman doing fairly technical work) and the availability of similar employment, the judge awarded 6 months’ pay in lieu of notice.

The judge was very critical of the employer’s approach, which he described as “shoot first and ask questions later.” Although the employer tried to rely on the fact that it undertook an investigation to show that its actions were appropriate, the judge noted that Mr. Lalonde’s side of the story was never properly considered. The judge was satisfied that the employer’s actions amounted to a breach of the duty of good faith, which supported an award of $75,000 in aggravated damages in addition to pay in lieu of notice.

Lessons to be Learned

  1. An employer cannot simply claim it has just cause to terminate an employee and make frivolous allegations. It is the employer that has the burden of proving just cause.
  2. It is good practice for an employer to present an employee with, and allow them to respond to the alleged misconduct. Failure to do so could be found to be a breach of the duty of good faith.
  3. An employer’s breach of the duty of good faith in the manner of dismissal may lead to an award for aggravated damages in addition to damages for wrongful dismissal.

If you have been recently terminated, with or without cause, you should speak to an employment lawyer. If you would like to speak to a lawyer at MacLeod Law Firm, you can reach us at [email protected] or 647-204-8107.

 

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

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