Employers shouldn't get clever with return to work offers
A couple of years ago, the Supreme Court of Canada made a decision that an employee who had been terminated and then, some months later, offered his job back, should have returned to work. As a result he was not entitled to damages after the date he was offered an opportunity to return. It was a very special case in that he was the sole employee of a union office in a remote town.
Some employers and employment counsel, however, have taken it as a license to play hardball with terminated employees.
They seem to think that if you terminate an employee, offer them a severance package and they reject it, you can always offer them their job back. If they don’t come back, you can argue that they are only entitled to the monies they lost between the termination and offer of re-employment. The idea that the courts would allow employers to terminate employees, make a lowball or no severance offer and then offer to bring them back if they don’t go away quietly into the night is misguided.
A woman named Lacey had worked for her employers for 19 years. In the middle of September, the company was experiencing financial difficulties. The manager met with her and told her she was being terminated. He said he told her she was simply laid off, meaning that she would be brought back to work when things picked up. In any case, both of them agreed that she was told that she would work until mid-October. A week later, Lacey sent an email to her supervisor which mentioned her termination. The response from her supervisor did not make an effort to correct her or say that she hadn’t been terminated but rather laid off.
Lacey was a senior employee in a small company. Other junior employees were being kept on. She felt embarrassed and humiliated. A few days after the email, the boss met with Lacey and told her that she was not being terminated but rather laid off. She was given lay off papers.
Under the Employment Standards Act,
if you lay somebody off instead of terminating them, you don’t have to pay out the minimum termination and severance pay required by the Act
until a later date, if you have not brought them back to work. On her last day of work, Lacey packed up and left. Management didn’t say a word to her. 19 years and no goodbye. Thank you very much. Lacey felt unappreciated, un-cared for and upset by having her employment end in such a manner.
In mid-February, Lacey had her lawyer write a letter asking for pay in lieu of notice. The letter from the company that she got back claimed that her boss had left her a voice message after New Years asking her to call about a possible return to work. The letter further indicated that Lacey could immediately return to work.
Lacey knew that there had been no call of any kind after New Years and that no one had ever left her a message asking her to call about a potential return to work. She was angry. She thought the employer was being manipulative to try to get out of having to pay her a reasonable severance package after her 19 years of service. She did not return to work and sued for wrongful dismissal.
The employer argued that she was never terminated, just laid off and effectively quit her job by not returning to work.
The judge reviewed the Supreme Court of Canada case and noted that an employee is not obliged to mitigate their damages by returning to work for an employer in an atmosphere of hostility, embarrassment or humiliation. The atmosphere, stigma and loss of dignity that were involved in the particular situation were relevant.
In this case, Lacey was first told she was terminated, then the employer claimed a layoff. Junior employees were kept on. Nobody said a word to her the day she was forced to walk out the door. The employer falsely claimed they had already tried to call her back to work and then extended a written invitation for a return to work only after they had received a lawyer’s letter asking for money.
The judge found that Lacey was terminated and had no obligation to return to work after such treatment. She was 64 years old at the time of her termination and older workers get increased notice periods because it is assumed that it will be harder for them to find new employment. The judge ordered the employer to pay her 18 months’ pay in lieu of notice and her legal costs.
Ultimately the judge will do a smell test. If a judge thinks the offer of re-employment was only extended as an afterthought to avoid litigation and employer had no genuine interest in calling the employee back to work, the judge will be more likely to find that a return to work would be humiliating or degrading.
Employers sometimes think that clever games will win the day but the courts almost always see through them.
As published in the Hamilton Spectator, May 2, 2011