Employer ordered to pay extra damages for conduct during termination

A recent Ontario Superior Court decision provides an important reminder for employers about proper conduct when terminating employees.

In Teljeur v. Aurora Hotel Group, 2023 ONSC 1324, the employer (a golf course) terminated one of its managers without cause. The manager was 56 years old and had worked at the golf course for 3 years. The employee surreptitiously recorded the termination meeting. The employee’s recording was accepted as evidence by the court on a motion for summary judgment.

The court ultimately awarded the employee damages in the amount of 7 months pay in lieu of reasonable notice, as well as special damages for other amounts that it found were owing to the employee. In addition, the court awarded $15,000 moral damages for an employer’s breach of its obligations of good faith and fair dealing in the manner of dismissal, due to what it noted were several “disturbing aspects” of the employee’s termination. Those included:

• The employer breaching Ontario’s Employment Standards Act (ESA) by failing to give the employee written notice of the termination despite the employee asking on at least 3 occasions for something “in writing”.
• The employer failing to deliver the employee’s ESA entitlements within the required timeframe which resulted in the employee having to go through the holiday season without financial support from his employer.
• The employer failing to reimburse the employee $16,680 for several business expenses (representing 23% of his income), despite assuring him at the termination meeting that he would be paid out “in the next week or so.”
• The employer indicating to the employee at the termination meeting that he would receive 8 weeks of severance or additional pay, but ultimately only providing him with his ESA minimum entitlement.
• The employer encouraging the employee to resign at the termination meeting (the court questioned whether by doing this the employer was trying to limit its exposure on a wrongful dismissal claim).

Takeaways for employers This decision serves as an important reminder for employers that they must fulfill all of their statutory and contractual obligations when terminating employees. Employers should also ensure that they deal with employees in good faith during the termination process and follow through on their promises as failure to do so may result in an award of moral damages. In this regard, it would be prudent for employers to make sure that their managers, HR and payroll staff are well trained on terminating employees as well as best practices for that process. As is evident in this decision, any missteps by an employer during termination ca be heavily scrutinized by a court if the dismissed employee alleges misconduct afterwards.

For more information on this and other similar topics, please contact Neal Parker at [email protected] or anyone else from our team listed on the Authors page.