Employment has taken us on a wild ride over the last few years.
While we are currently on the brink of recession-related job losses, many employees lost their livelihoods during one of the many lockdowns since March 2020.
Not only that, losing a job in the last few years made reemployment particularly challenging. There was a constant threat of another lockdown or another vaccine mandate and economic downturn.
Pylyp Pavlov, a director of marketing communications and public relations at the New Zealand Australian Lamb Company Limited, was one such employee terminated at the inception of the pandemic in May 2020 — just before he celebrated his third anniversary at the company.
He was 47 years old at the time and earned $131,943 plus a bonus of up to 15% of his base salary and benefits. He sued for wrongful dismissal damages.
After he was terminated, Pavlov applied to over 100 jobs but he was still unemployed at the time of his trial in November 2021.
At trial, Justice Stewart awarded Pavlov 10 months in wrongful dismissal damages. He was also awarded the bonus and benefits he would have received had he continued to work over the 10-month notice period.
Justice Stewart noted that Pavlov was recruited from another company to join New Zealand, which can often lead to a lengthier notice period award. Also notable was the court’s consideration of the availability of similar employment. The court recognized the timing of his termination, just two months after the lockdowns, and found that his employer should have figured it would take him longer to reemploy when terminating him in May 2020.
New Zealand appealed the 10 month award to the Ontario Court of Appeal in September 2022. The appeal was dismissed. On the availability of similar employment the court of appeal stated: “Effects and uncertainties of the pandemic were obstacles to his efforts to obtain alternate employment, and that the appellant would, or should, have known of these obstacles at the time of termination.”
There are a couple of great takeaways from this case.
A relatively short service employee can receive longer notice periods if the timing of your termination makes it particularly difficult to reemploy. As many tech companies are shedding jobs, employees from this industry could benefit from longer notice periods relying on the case of Pavlov.
Second, employees are often entitled to the bonus they would have earned if they continued to work during their notice periods. Often employees relinquish this claim as employers rarely offer to pay a loss of bonus payment. But, as this case shows, employees should maintain this ask in post-termination negotiations.
Lastly, if higher interest rates and a recession tighten the labour market, terminated employees may have a much tougher time finding new, comparable employment in the coming months. When an employee can support this claim with many job applications to indicate their reemployment efforts, this is very compelling to a court. It is the evidence a court needs to support higher awards.
As we walk into uncertain times for employment, the case of Pavlov signals there may be lengthier notice periods ahead.
On to this week’s questions:
Q. I just found out I am expecting a baby. When do I have to tell my employer? Is there a certain time I must do it by?
A. No, you can tell your employer when you’re ready. You may choose to share this information four to five months prior to your due date to give you and your employer time to plan for the parental leave you may take and the transition of any tasks to your replacement during your leave. This is also a good time to ask if there is any support (like financial top ups) your employer offers during your leave.
Q. An employee just resigned from my company abruptly after we invested in very expensive training for him. I know he is now working for a competitor. This is very upsetting and I wonder if there is any recourse?
A. While this is very frustrating, most employees are not limited from moving on to a competitor. If the resignation was very short or immediate, you can consider bringing a wrongful resignation claim against the offending employee but you will have to establish this employee was very hard to replace and that you incurred significant costs when he abruptly resigned. If you can’t establish this, don’t embark on this fool’s errand.
Have a workplace issue? Maybe I can help! Email me at sunira@worklylaw.com and your question may be featured in a future column.
The content of this article is general information only and is not legal advice.
