As we have written before, if an employer mistreats an employee either during their employment or at the time of their termination, that employee may be entitled to aggravated damages (or damages for mental distress). The most common situation in which these damages are awarded is when an employee can prove they suffered mental distress as a result of a particularly insensitive termination.
Last year, I wrote about Saadati v Moorhead, a Supreme Court of Canada decision which arose in the context of personal injury. In this case, the Supreme Court upheld the trial judge’s award of damages for mental injury, which was based largely on the testimony of the plaintiff’s family and friends who testified on significant changes to the plaintiff’s personality after the accident. The Supreme Court clarified that although expert evidence will often be helpful in determining whether the plaintiff has proven a mental injury, it is not a requirement. In my blog post on this case, I predicted that employment lawyers would increasingly cite this Supreme Court decision when arguing a claim for aggravated damages.
In Ensign v Price’s Alarm Systems, a 63 year old salesman who had never signed an employment agreement with his employer, Price’s Alarm Systems, was terminated after 12.5 years of service. After providing notice of termination of employment, the employer made three offers to re-employ Mr. Ensign in different positions and under different terms. Mr. Ensign refused all three offers and sued his employer for wrongful dismissal.
The court found that Mr. Ensign was not required to accept re-employment with his employer for various reasons. Due to Mr. Ensign’s age, length of service, and poor employment prospects, the court concluded that he was entitled to a 12-month notice period.
On the issue of aggravated damages, Mr. Ensign argued that the employer was not forthright about various matters relevant to his termination, including the existence of a written contract of which limited his entitlement to termination notice, and the reason for his termination. Mr. Ensign and his wife testified that the manner in which the employer terminated his employment caused him to suffer mental distress. However, Mr. Ensign did not have corroborating evidence from any physicians.
The court found that the employer was not truthful and candid about the reason for Mr. Ensign’s termination. Furthermore, the employer had embarked on aggressive and unmeritorious defence tactics that affected Mr. Ensign’s marriage, impacted his ability to sleep and caused him stress and emotional upset. Mr. Ensign was awarded aggravated damages in the amount of $25,000.
Surprisingly, Saadati v Moorhead was not cited in the decision, but its effect can be felt in Ensign v Price’s Alarm Systems. If you believe your employer has not been forthright or honest about your termination, and you are suffering from mental distress as a result, it’s highly recommended that you consult an employment lawyer to find out about your rights.
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