Employees have both contractual duties and common law duties towards their employers. Recently we wrote about an employee’s contractual duties toward their employer. In that case, the Court found the employee had repudiated her employment contract because she failed to perform her work duties. This week we turn our minds to the duty of employees to take reasonable steps to mitigate their losses after being terminated from their employment.
Employee’s Job Search Efforts Called into Question
The employee had been employed for over five years. The employee was terminated without cause; therefore, she was entitled to reasonable notice due to wrongful dismissal. At the time of termination, the employee was earning a salary of $185,000 per year. She was enrolled in a health benefits plan, a pension plan and had 20 days of paid vacation each year. In addition to the salary and benefit plans, the employee also received an annual bonus. The employee had earned the bonus every year.
The plaintiff learned she was being dismissed in March of 2019. Her last day of work was just over a month later. The employee had maintained a chart of her job search efforts. She started documenting her efforts starting in June of 2019. The employee signed up for emails from a job site. She also participated in career transitioning services provided by her former employer and met with her career coach. The evidence indicated though that she did not engage the career transition service until late June. During her cross-examination, when the employee was asked what she did in May 2019, she included steps she took well after May 2019, including paying for a career coach herself.
In the year after her termination, the employee applied for eleven jobs. Nine of these jobs were for more senior roles than her previous role. The employee stated that these nine positions may have been more senior, but that they included responsibilities with which she was familiar.
Court Finds Employee Did Not Make a Reasonable Effort to Mitigate Losses
The Court found that the employee did very little, if anything, in May 2019 to look for work. It was also found that there was no evidence of the job descriptions for the nine more senior positions in the record. The Court had difficulty accepting that the nine advertised vice president positions included duties generally executed by people who had held more junior titles. It was found that the employee had focused her job search on roles that would represent a promotion over her prior role.
Further, the Court found that the appropriate notice period was nine months. Over those nine months, the employee applied for only seven positions, six of which were vice president roles. She submitted her first job application only in September of 2019, which was over four months after she stopped working.
In the end, the court concluded that the employee did not take reasonable steps to mitigate her damages. She was found to have failed in her duty to mitigate her damages in three ways:
- The employee waited too long to start her job search. She should have begun her job search in May of 2019, but she delayed it for a month;
- The employee aimed for positions that were too high. Although there was nothing wrong with applying for higher positions, she should have applied for lower positions as well. Especially the longer she remained unemployed; and
- The employee waited too long to apply for jobs and she applied to few jobs.
The Court made several inferences in this case. If the employee had expanded the limitations she put on her job search and applied for more positions, her chances of being employed sooner would have improved significantly. Furthermore, if vice president roles were available, then more junior roles were available as well. The Court concluded that the employee chose to unreasonably limit her job search, which had an impact on her ability to find a job.
Accordingly, the Court reduced the period of reasonable notice to which she was entitled by two months.
The bottom line is that employees owe duties to employers, even if they have been terminated with insufficient notice. They must perform the functions of their jobs while employed. If an employee is terminated, they must do their best to mitigate their damages, as the previous case has shown. Failure to do so risks a finding of a shorter reasonable notice period.
Contact Grosman Gale Fletcher Hopkins LLP in Toronto for Employee/Employer Disputes
Employees and employers must be well-informed about their duties towards each other. That applies both to contractual duties and common law duties. Breaches of either duty could have costly consequences for both parties. For advice on employee rights, employer liability and other employment or labour law matters, contact the offices of Toronto employment lawyers Grosman Gale Fletcher Hopkins LLP. We regularly advise workplace parties on a wide range of legal workplace issues. Contact us online or by phone at 416-364-9599 to schedule a consultation.
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