Employer's Duty To Give Reasonable Notice Or Payment In Lieu

• Published date: 22 November 2022
• Subject Matter: Employment and HR, Employment Litigation/ Tribunals
• Law Firm: Walker Law
• Author: Walker Law

It is an established principle in employment law that an employer is allowed to terminate or fire an employee without cause, which means without a reason, but that they must give their employee "reasonable notice" or "pay in lieu of reasonable notice." This means that they must give their employee notice in advance that the employee will be dismissed, or pay them to compensate for the lack of notice. The Courts have indicated that beyond statutory minimum notice periods, what is "reasonable" will depend on many factors, including the type of position the employee held, the duration of the employee's post, the employee's age, and whether similar employment is available for the employee to find.

Employee's Duty to Mitigate

When an employee is constructively or wrongfully dismissed from a job, they have a responsibility to try to find comparable alternative employment. This is called "mitigating their damages", which means minimizing their damages.

If an employer accuses a former employee of failing to mitigate, it is the employer's (or their workplace lawsuit lawyers') responsibility to prove it. In a 2010 case Link v Venture Steel Inc, the Ontario Court of Appeal ("ONCA") held that employers must prove that (1) their former employee did not take reasonable steps to mitigate their damages and that (2) if such steps were taken, the former employee would have likely obtained comparable employment that was reasonably adapted to their abilities.¹

Employees Need Not Seek Out Lesser Job

In a recent ONCA case, Lake v La Presse, an employer alleged that a former employee failed to mitigate her damages after being dismissed without a valid reason. In this case, an online newspaper company dismissed its employee without cause, and only gave her about one month's notice of the termination, even though she worked there for five and a half years. The rough rule is that the Court usually awards one month of pay per year that the employee worked with the company. The employee tried to find new employment, but two years after her termination, remained unemployed. The employer's employment litigation lawyer argued that the employee had failed to mitigate her losses by failing to find another job. The lower court judge agreed with the employer, and held that the employee should have sought out lower-paying jobs to mitigate her damages. The lower court judge accordingly reduced the notice...