In Gascon v. Newmont Goldcorp 2022 ONSC 2511 Justice Fregeau had a situation where a General Manager of a large mine was told that the mine was being sold but that his employment would continue with the new employer.
The trouble was that two months before the deal closed the employer decided that if the new owner would not hire the Plaintiff then he would be terminated. They failed to tell him this. In fact even when they knew one week before closing that the new owners were not going to hire the Plaintiff, they failed to tell him .
The Court did not like this and made two rulings as a consequence of this:
1) He was awarded $50,000 for moral damages because their conduct was ” untruthful, misleading and unduly sensitive “.
2) The Plaintiff had regularly received a very significant discretionary Long Term Incentive ( LTI) every year around March of every year, part of which vested immediately. However in the year in which the deal closed ( on March 30th) they decided not to grant him a LTI because they knew they were going to fire him. This was found to be a unfair and discriminatory exercise of discretion as the bonus was intended to compensate him for his efforts in the past year.
This is what the Judge said :
[90] However, as noted by Wilton-Siegel J. in Chann v. RBC Dominion Securities Inc., 2004 CanLII 66310 (ONSC), at para. 79, the fact that the decision to terminate the employee’s employment had been made “did not remove the need to approach the process of decision making in the same manner as in past years. The [employee] was contractually entitled to have his remuneration determined on the same basis as in prior years and for other employees in the same year”.
[91] As this decision explains, Mr. Gascon was contractually entitled to have Newmont Goldcorp consider an LTI award in his favour at the usual time (the beginning of March according to Mr. Thornton) using the usual criteria that were applied to all other employees. It follows that Mr. Gascon may have been contractually entitled, despite the wording of the May 2019 Employment Agreement and his imminent termination, to an LTI award from Newmont Goldcorp in March 2020.
However, given the lack of evidence on this issue the Judge ordered a mini trial on the issue of both entitlement and quantum of the Plaintiff’s entitlement to the LTI award for the year the Plaintiff had just completed.
If you like a copy of this case email me at barry@barryfisher.ca
In Bryant v Parkland School Division, 2022 ABCA 220 ,the Justices considered the meaning of the following termination clause:
“This contract may be terminated by the Employee by giving to the Board thirty (30) days or more prior written notice, and by the Board upon giving the Employee sixty (60) days or more written notice.”
The trial judge said that this gave the Employer a discretion but not an obligation to give more than 60 days notice.
The Court of Appeal thought otherwise. Here is what they said :
[15] The starting point, then, is that there is a presumption of an implied term requiring the employer to provide reasonable common law notice on dismissal. Only where the employment contract unambiguously limits or removes that right will the presumption be rebutted, and the implied term ousted. The chambers judge did not begin his analysis with these principles at the forefront.
[16] When these interpretive principles are properly applied, it is clear the clause does not unambiguously limit the employees’ right to common law reasonable notice. The clause does not clearly fix the employees’ notice entitlement. It does not impose an upper limit on the amount of notice an employee is entitled to receive. It does not suggest that 60 days is the maximum notice to which an employee is entitled. To the contrary, it explicitly provides that an employee can be entitled to more notice. The inclusion of the words “or more” recognizes a longer notice period as a realistic possibility.
[17] The chambers judge noted that “if the contract contained only the words ‘60 days’ it would be abundantly clear that [the employer] had fixed its notice at 60 days”. We agree. Such languagewould have been clear and unambiguous. But that is not what the clause says. The chambers judge concluded the employer had given itself the discretion to decide the amount of notice owing to an employee. That seems a questionable conclusion. If that was intended the employer could have written the contract to clearly say so. Another, and more reasonable, interpretation is that the employer intended the notice period to be in accordance with common law standards, subject to a minimum notice period of 60 days.
[18] The key point is that the clause is not sufficiently clear, unequivocal and unambiguous to remove or limit the presumed common law right of the employees to reasonable notice. Thereading more favourable to the employee must prevail.