Why would an employee insist that he was entitled to only four months notice of dismissal when the employer suggested five? In an unusual reversal of roles, an employee who had sued for six months notice argued at trial that four months would be sufficient, while the employer, who had offered five weeks pay in lieu of notice at the time of dismissal, changed its position at trial, and urged the court to award five months.
The plaintiff was an electrical engineer who had worked for the defendant for a little more than three years when he was laid off as of November 27, 2008. The reason for dismissal was a downturn in the electronics industry, and there was no allegation of cause. His salary as of the date of dismissal was $55,000 a year.
The plaintiff began his job search with alacrity, and was hired by RIM starting March 30, 2009 at a salary of $70,000. When the case got to trial, he tried to convince the court that the appropriate notice period was four months, the time that it actually took him to find a new job. Why? Since his new salary was significantly higher than his earnings with the defendant, each additional month of notice beyond his March 30, 2009 start date with RIM would result in a lower award of damages. This is because the Court would have to count his increased earnings as money that he obtained in mitigation of damages.
The employer argued that the appropriate test for notice should consist of the usual factors, including the age of the plaintiff, the nature of his work, his salary, training, and education, the labor market in the industry, and a general assessment as to the amount of time it would usually take someone in a similar situation to find comparable employment.
The trial judge agreed with the employer, who cited authorities stating that where a dismissed employee successfully mitigates his losses, the employer is entitled to the benefit of the employee’s diligent job search efforts. Case law also establishes that the notice period is to be determined on the facts that exist at the moment of dismissal, and not by hindsight as of the date of trial.
In the end, the judge sided with the employer and concluded that a reasonable period of notice would be five months, the time it would normally take a person in the same situation to find comparable employment. This resulted in a somewhat lower award of damages than would have been the case if the employee had convinced the court that the shorter four-month notice period was reasonable.
Link: Serbanescu v. Span Manufacturing Ltd., CanLII – 2010 ONSC 6087 (CanLII)
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