Employment & Labour

Case offers clarity to question of duty to mitigate: Fisher

By Todd Humber, AdvocateDaily.com Contributor

Employees who have lousy jobs are obligated to look for similar gigs if they’re terminated, rather than take a package and be retrained at their former employer’s expense, says Toronto employment lawyer Barry Fisher.

He makes the comments in light of the Ontario Superior Court of Justice ruling in this case.

According to the decision, an unskilled labourer with 28 years’ tenure was terminated, along with 41 other employees, when the company eliminated their jobs at a plant in Scarborough, Ont. Instead of looking for work, the plaintiff opted for retraining and enrolled in a full-time, six-month welding program.

He sued his former employer, seeking 24 months' in common law notice — less the 34 weeks’ statutory termination pay he had already received.

The employer pointed out there were at least three similar jobs available, posted about one month after he was terminated, and there was a good chance he would have been hired. The court agreed and declined to award him common law notice.

“As admirable as it was that he wanted to improve his life, he’s not going to be re-educated at the employer’s expense,” says Fisher, principal of Barry Fisher Arbitration & Mediation. “If he was employed as a labourer, then his obligation is to look for work as a labourer.”

The ruling offered some clarity to the often confusing and hazy question — where is the line drawn when it comes to an employee’s duty to mitigate damages? If a similar opportunity exists, it’s a pretty straightforward obligation on the employee to accept, he tells AdvocateDaily.com.

But employers shouldn’t interpret this ruling to mean they will always be off the hook for compensation if employees decide to seek retraining, says Fisher.

“If, in fact, the job the guy had no longer existed, then it would have been reasonable for him to train,” he says.

Fisher gives the example of a computer programmer who is an expert in coding that was obsolete. If that worker is unable to find any demand for that language, then a court would likely support the plaintiff in retraining and award the common law notice period.

“It’s not that the employer is not responsible for retraining. It’s just that if there’s a job opportunity at your previous place of employment, you can’t simply depart and go look for a new career or the thing you always wanted to do,” Fisher says.

Retraining is just one option on the table for employees who lose their jobs. Many decide to hang their shingle and start their own businesses, something Fisher says is becoming more common. An employer may be tempted to say that’s an unreasonable effort at mitigation, given the person is unlikely to make any money — especially in the short term.

“Again, it’s all seen through the lens of what’s reasonable, and the employee is given wide, wide deference in choosing what is reasonable,” he says.

Employees who go the route of setting up their own businesses may also want to consider looking for a job at the same time in an effort to prove they genuinely are trying, Fisher says. For example, your dream may have always been to own a dog grooming business — and this may be an opportunity to do so if a generous package is on the table after losing your job.

“I would always strongly suggest that he start his own dog grooming business but at the same time go through the motions of looking for a real job.”

A court would never be critical of a terminated worker who started his own business and at the same time sent out resumés. As long as workers can show they made an effort to find work, mediators, judges and other decision-makers won’t take them to task for a failure to mitigate, he says.

Employers are often misguided as well when it comes to mitigation, especially when it comes to helping their former workers find employment, says Fisher.

They allege cause. They refuse to provide reference letters. They point out how their industry is dying, and they’re almost bankrupt. They will claim the plaintiff is incompetent, and then turn around and question why he can’t find a job, he says.

What they need to remember is that it’s in everyone’s best interests if the terminated employee finds a new job.

“It certainly is in the plaintiff’s interest, it saves the employer money, and it’s better for the economy,” says Fisher. “I’m always amazed at how employers not only don’t help employees get new jobs but actually put barriers in their way.”

Too many employers have what Fisher calls an “insane” view of providing positive references about former workers.

“They worry that, somehow, they can be sued if they say something nice about somebody,” he says.

Fisher tells the story of a friend who recently had to lay off an administrative assistant after many years.

“He’s gone out of his way to call and say she’s a good employee,” he says. “He went out of his way to call his colleagues and talk her up — ‘You know, she’s really good. I’ve had to lay her off because things were slow.’”

It’s a great tactic because the employee feels good about the situation, he says.

Compare that to the usual situation where a worker is terminated, there is no package, and she runs off to a lawyer, Fisher says.

“Right away, it’s all wired up,” he says. “We can’t be nice anymore.”

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