In Holmes v Hatch Ltd ( 2017 ONSC 379 ) Pollak J. awarded 18 months notice to a 54 year old Project Manager and Engineer with 17 years service .
The motion for summary judgement took place only 6 months after the termination of employment so the Court had to deal with how to award damages for the possible future loss.
This is what the Court did:
[33] With respect to the issue of the Plaintiff’s continuing duty to mitigate, I find that the evidentiary record does not allow this Court to make a finding on whether the Plaintiff will have any employment income loss during the balance of the notice period or whether he will successfully mitigate. Even though the Plaintiff has argued that he has not been able to find employment to the date of this motion, he moved for summary judgment knowing that it would be heard before he suffered any loss of employment income. To remedy this difficulty, the parties have advised the Court that they agree to follow the approach the Court has taken in the case of Markoulakis v. SNC-Lavalin Inc., 2015 ONSC 1081 (CanLII), 253 A.C.W.S. (3d) 362.
[34] The Court has determined that the total reasonable notice period for Mr. Holmes is 18 months. It follows that the Defendant has the obligation to pay Mr. Holmes the appropriate monthly compensation for the balance of the 18 month notice period subject to the deductions I have referred to above. The Defendant’s obligation to pay is also subject to the Plaintiff’s obligation to mitigate his damages and to a deduction in the monthly payments by the Defendant for any earnings from employment or a business. If during the balance of the notice period, the Defendant challenges the mitigation efforts or earnings of the Plaintiff and does not make such payments to the Plaintiff, the parties should determine the appropriate procedure for resolving this dispute.
[35] The parties have not agreed to, or provided the Court with, evidence on the amount of compensation Mr. Holmes is entitled to on a monthly basis for damages during the notice period. The Court has therefore only provided the parties with the above-noted legal determination of the duration of the reasonable period.
[36] Partial summary judgment is therefore granted by way of a declaration with respect to Mr. Holmes’ entitlement to 18 months’ damages for wrongful dismissal. The parties did not make any submissions on the procedure to be used if they require adjudication on the remaining potential issues and the calculation of “mitigation and damages”. I therefore make no ruling in this regard.
[37] At para. 78 in Hryniak, the Supreme Court of Canada held that:
Where a motion judge dismisses a motion for summary judgment, in the absence of compelling reasons to the contrary, she should also seize herself of the matter as the trial judge.
[38] In my view, this is an appropriate case for me to follow the Supreme Court’s direction and remain seized of any necessary future proceedings in this matter, such as a trial of the remaining issues. I must, however, qualify this to be subject to the practical reality of our court’s ability to schedule trials in a timely and expeditious manner. I will not be seized of this trial if the effect of my unavailability would be to delay the hearing of the trial between the parties. If it is possible to do so without adverse delay or consequences to the parties, I seize myself of the trial of this matter as directed in Hryniak.
I believe that this is a better approach to deal with the issue of ongoing damages than either the trust method or the discount method for the following reasons :
- It best mimics what the law requires, that is paying compensation during the notice period less income earned through mitigation.
- It allows Plaintiffs to have actual benefit coverage during the notice period rather than a payment in lieu.
- It reduces the gamesmanship involved in setting the date for the motion for summary judgement in that no matter what the date is the duty to mitigate and the effects of mitigation remain the same,
I would however suggest that counsel should have suggested some procedure for adjudicating any future mitigation issues.
The parties could agree that this issue would be decided either by arbitration or by returning to the motions judge. There should however be a provision that the employer is not allowed to unilaterally cut off the payments if they simply allege a failure to mitigate, rather they should be required to keep up the payments pending the Courts’ or arbitrators’ determination. This will avoid the circumstance of the Employer using the act of withholding payments as a pressure point to negotiate a discounted lump sum for the balance of the notice period. Any payment received by the Plaintiff in excess of what the Court or arbitrator determined was owing could simply be repaid.
The Labour and Employment section of the Ontario Bar Association, back in about 2009, produced a report for Chief Justice Winkler called the OBA Task Force on Wrongful Dismissal . In that report the Task Force had this to say about what they thought should be done about determining the on going payments after a motion for summary judgement.
The Court would assess the plaintiff’s mitigation efforts up to the date of the motion, and if the notice period continues beyond the date of the motion, the Court would, rather than order a lump sum payment of the entire notice period, order a payment to first bring the plaintiff’s wages and benefits up to the date of judgement. Then, the Court would make a further order that the defendant be required to continue to pay the plaintiff his or her salary and benefits to the end of the notice period, subject to the plaintiff’s continuing obligation to mitigate.
If the plaintiff is to receive payments beyond the date of the motion, then the plaintiff will be required to report monthly, by statutory declaration to the defendant, what his or her mitigation efforts and mitigation income have been. The defendants’ payments would be reduced by any mitigation earnings, on a dollar for dollar basis. If the defendant believed that the plaintiff’s mitigation efforts were not reasonable, it could apply to the Court to amend the order requiring payment. The defendant could not unilaterally suspend the payments before the return date of the motion.
If there were other issues that required determination, the Court could still order the payment of reasonable notice and order that the other issues be tried. For instance, if the parties agreed that the plaintiff’s base wage was $60,000 per annum but disagreed both on the quantum and the entitlement to a bonus, the Court could order monthly payments of the base wage only and defer the issue of the bonus entitlement to a full trial.
I was on that committee. it was a good idea then . It is still a good idea. I am glad to see that at least Madam Justice Pollak has adopted this procedure. I can only hope that it catches on with the rest of the Bar and Bench.