Employee Gets Advantages of Both Fixed Term and Reasonable Notice :

In Rice v Shell Global Solutions ( 2019 ABQB) Eamon J. had a situation where an employee who had already worked for the defendant for about 8 years under a number of different fixed term and indefinite term agreements, was offered a new position which had the following language :

Your Assignment Length will be : 4 years.

She was let go without cause 10 months later and was provided with working notice and termination pay for another 3 months. She found new employment 7 months after her notice of termination.

The Judge had to decide what meaning to put to the reference to 4 years. This is how the Judge sets out the alternative interpretations

57      Consequently, a reasonable person interpreting this contract, having carefully thought about the matter, could see more than one meaning. In my opinion, there were three alternative meanings. One could reasonably ask:
By “Assignment Length” do you mean that
(1) she is a fixed term employee whose employment is over at the end of four years,
(2) she is an indefinite term employee who cannot apply for other positions without her manager’s permission for four years, or
(3) you are promising her work or an assignment for at least four years?
The Judge concludes that the correct interpertation is the the third one .
63      The objective interpretation which gives reasonable meaning to the explicit phrase “Assignment Length”, does not impose the harsh consequences of a traditional fixed term contract, is the most plausible meaning in the limited surrounding circumstances which both parties knew or ought to have known, and is most favourable to Ms Rice, is that Ms Rice receive the promised assignment of four years (absent termination for cause) but not that the contract would automatically end at the conclusion of that time. Thus the contract is terminable effective any date thereafter in accordance with the common law. The use of the word “assignment” rather than “employment” in the contract supports this interpretation. The relatively short duration of the assignment distinguishes this case from the long, and therefore unlikely, claim to employment duration considered by the Manitoba Queen’s Bench and Court of Appeal in Wallace.
In assessing damages the Court calculated what she she would earned with Shell during the balance of the 4 years but deducted what she actually did earn by way of mitigation income. The Judge examined the Ontario Court of Appeal case which said that these earnings are not deductible ( Howard v Benson Group Ltd 2016 ONCA 256) but ruled that where the language does not exclude mitigation earnings, it must be deducted .
Interestingly the Judge also went on to find that if the contract was not a fixed term, the common law notice would be 15 months. However the actual damage award only reflected the losses to the end of the 4 year fixed term but not  also the 15 months after the end of the notice period. Apparently Plaintiff’s counsel did not seek that remedy as the Plaintiff only requested payment until the end of the fixed term.