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Exceptional Circumstances and Entitlement to Notice

Recently, the Ontario Court of Appeal dismissed the Employer’s appeal seeking to reduce the common law notice period from 26 to 24 months notice.  The case of Currie v. Nylene Canada Inc. involved a 39-year employee.  Ms Currie was dismissed on a without cause basis but offered only her statutory entitlements.  At trial, the trial judge awarded Ms. Currie 26 months’ compensation.  Justice Smith held that her case was exceptional and warranted a longer than usual notice period because:

  1. She left high school for this job which was the only full-time job she ever held;
  2. She worked for the company and its predecessors for 39 years;
  3. She was 58 when she was dismissed and near the end of her career;
  4. She had specialized skills, making it difficult for her to find other employment;--
  5. She had limited computer skills;
  6. The dismissal was tantamount to a forced retirement;

The Ontario Court of Appeal was satisfied  the trial judge reviewed the appropriate common law factors and then clarified and distinguished its earlier decisions in a number of cases including Dawe v. The Equitable Life Insurance Company and Lowndes v. Summit Ford Sales

In Dawe – the Ontario Court of Appeal set aside the trial judges award of 30 months notice when the trial judge committed an error in principal.  Mr. Dawe asked for a package after he was reprimanded by his employer.  He was thirty months away from retirement.  The trial judge erred by considering Mr. Dawe’s time to retirement as a factor determining reasonable notice.  In particular this court found,

The motion judge rested his determination  of reasonable notice on the mandatory retirement considerations.  He noted that at the time of Mr. Dawe’s termination, the award of 30 months’ notice ensured that he would be fully compensated to just beyond his 65th birthday. 

The Ontario Court of Appeal found the plaintiff’s retirement plans were irrelevant to the determination of Equitable Life’s obligations to Mr. Dawe.  Time to retirement is not a valid consideration unless there is a guarantee of employment to age 65

The clear takeaways from the Ontario Court of Appeal is - where there is no "error in principle" related to a finding of exceptional circumstances such as time to retirement; or bad faith; or some other improper imported consideration, it will not reduce the notice period.  This would be "tinkering" - something which the Ontario Court of Appeal has expressed disinterest in doing. 

One other point worth noting is that this case was not only appealed on the basis of notice.  The appellant had tried to argue Ms. Currie had a “break in service” when she accepted a pension that she had accrued from a predecessor employer even though her employment continued seamlessly with Nylene.  The appellant was seeking to reduce Ms. Currie’s notice entitlement to a minimal amount, far less than the 24 or 26 month range.  The first argument was summarily dismissed by both the Trial Court and the Court of Appeal.  Although not stated in the decision, advancing an unwinnable argument on the first point may well have affected the appellant’s chances with the Court of Appeal on the second issue.