Employment Law: Court Upholds Without Cause Termination

In the decision of Dennis v Ontario Lottery and Gaming Corp. the Ontario Superior Court of Justice upheld the terms of a “without cause” termination settlement notwithstanding the employer’s assertion that “after acquired” cause existed.

Without Cause Termination Settlement

By way of background, after thirteen (13) years of service, the employee was terminated without cause. She accepted the terms of a settlement package, which included fifty-three (53) weeks of pay in lieu of notice/severance.  Prior to this happening, and while still employed with the employer, the employee was provided with discounted tickets to Canada’s Wonderland to offer the other employees as a part of her job.  She was then required to submit the money received from her fellow employees to Canada’s Wonderland.  Around this time, the employee was involved in a fraud scam resulting in her using over $1,000.00 of the money owed to Canada’s Wonderland for other purposes. It was the employee’s intention to repay the funds prior to remitting them to Canada’s Wonderland.

Employment Law - Without Cause Termination - Ontario, Canada

Following the employee’s termination and receipt of above-noted settlement package, the employer discovered the missing monies. The police became involved in the matter, interviewed the employee and charged her with theft and breach of trust.  Eventually, the Crown withdrew the charges against the employee, which the employer was made aware.  The employer then conducted an internal investigation into the situation and held that the employee stole the money.  As a result, the employer informed the employee it would not be adhering to the terms of the termination package due to having found cause to terminate the employee.

Court Upholds Without Cause Termination

The Court held that “it is totally disproportionate for [the employer] to view [the employee’s] conduct as support for termination with cause” and held the employee was entitled to the enforcement of the settlement agreement with the employer. In coming to its judgment, the Court noted that the employee’s selling of discounted Wonderland tickets was unpaid and not normally a role assigned to her position, the employee intended on repaying the amount owed, the money related to the tickets was not the employer’s property, and the employee lacked intent to steal.

Court Upholds Without Cause Termination Settlement - KCY at LAW

Termination Without Cause Experts

This case highlights the high threshold required before an employer can be successful in proving a causal termination.  This case is also important for employees in that it is just one example of an issue that can arise following the execution of a settlement package.  It is incumbent for both employers and employees to know their options and the potential risks prior to executing settlement documents and what steps may need to be taken should new information become available.

We have the termination without cause expertise to help you with any case relating to employment law so call KCY at LAW today at (905) 639-0999 or contact us online to schedule a consultation!

Long Term Disability Benefits: Negligent Misrepresentation

In a recent British Columbia Supreme Court decision, Feldstein v 364 Northern Development Corp., the plaintiff successfully sued his employer for negligently misrepresenting the details of the employer’s LTD policy.

Long Term Disability Benefits – Feldstein v 364 Northern Development Corp.

By way of background, at an early age the employee was diagnosed with cystic fibrosis. As a result, the employee would only accept employment if the overall remuneration package included sufficient Long Term Disability benefits that did not depend on whether the employee had pre-existing health conditions. The employee in this case was terminated from his employment and given six (6) months’ working notice. During this notice period, the employee began actively searching for employment. During an interview for a potential job opportunity, the employee informed the employer of his condition and requested clarification as to the employer’s benefits package. Following the receipt and review of the employee benefits booklet, the employee asked what “Proof of Good Health” meant with respect to LTD benefits. The employer informed the employee that this was related to the three (3) month waiting period required for the plan to come into effect. The employee accepted employment based on this information.

Long Term Disability Benefits Ontario Court Findings - KCY at LAW

LTD Benefits

Approximately one (1) year after commencing his employment, the employee’s health condition declined. The employee was ultimately approved for LTD benefits but at a rate less than a quarter of the expected monthly benefit due to the employee failing to fill out a health questionnaire when he initially enrolled in the benefits. This monthly amount was reduced even further on account of the employee receiving CPP benefits, for a net amount of $37.00 per month. The employee commenced a lawsuit against the employer for negligent misrepresentation.

Long Term Disability Benefits – Court Ruling

The Court found that the employee’s claim ought to succeed based on its finding that the employer owed a duty of care to the employee “as an employer making representations to a prospective employee in the court of pre-employment discussions”. The statement regarding the clarification of “Proof of Good Health” was inaccurate and misleading. The Court further found that the employee relied on this clarification to his ultimate detriment and awarded him damages for the loss of LTD benefits and for mental distress.

Feldstein v 364 Northern Development Corp Long Term Disability Benefits Courrt Findings

This case highlights how important it is for employers accurately represent and describe the terms of employment, including those that relate to LTD benefits. Otherwise, an employee, like the one in the aforementioned case, could rely on any statement given detrimentally and be awarded damages as a result. Employees should ensure they seek clarification to any terms that are unsure of and seek independent legal advice in order to ensure there is no misunderstanding.

Long Term Disability Lawyers

We at KCY at LAW have the expertise and experience necessary to help determine issues like the one in the above-noted case, both from an employer’s and employee’s perspective. Call KCY at LAW today at (905) 639-0999 or contact us online to schedule a consultation!

Employment Law: Frustration of Contract

What is frustration of a contract? Frustration of contract is where a particular event or circumstance arises that renders an employment contract fundamentally different from what was originally intended by the parties, the contract may be terminated without liability. Frustration will only apply where the event or situation was unforeseeable and through no fault of either party. Frustration must be determined on a case-by-case basis.

What Is Frustration Of Contract - KCY at LAW

How To Prove Frustration of Contract?

The onus is on the employer to prove the contract has been frustrated. Should the employer be successful in alleging there has been a frustration of contract, the employer is not obliged to give the employee common law notice or pay in lieu of notice. The employer’s only obligation would be to pay the employee his or her minimum entitlements under the relevant employment standards legislation (for example, the Employment Standards Act or Canada Labour Code).

Examples of Frustration of Contract

Some examples of frustration have included illness, death, or a catastrophic event that was unforeseeable. Employers may take the position that the contract is frustrated on account of the employee is receiving long-term disability benefits. Despite continuing to receive LTD benefits, however, this may not equate to frustration of contract. Other employers include clauses in contracts which state that the employee is deemed terminated if he or she cannot work because of illness for 90 days, which may violate the Ontario Human Rights’ Code.

Examples of Frustration of Contract - Employment Law Lawyer

Frustration of Contract Experts

Whether you are an employee whose employment is being terminated due to frustration or you are an employer wondering if an employee’s employment has been frustrated, we at KCY at LAW have the frustration of contract experience and employment law expertise necessary to effectively assist you in order to ensure your legal rights are properly looked after.

Call KCY at LAW at 905-639-0999 or contact us online and book your consultation right now!