Month: July 2023
No Warnings Means No Just Cause:
In Cumberland v Maritime College of Forest Technology ( 2023 NBKB 065) Justice DeWare awarded a 7 year, 52 year old, Academic Instructor, a 7 month notice period .
This case, which went on for 9 trial days, focused largely on the various grounds of just cause. In the end this is what the Judge had to say on the issue:
CONCLUSION ON JUST CAUSE DISMISSAL
[72] In the event Mr. Marshall or Mr. Davies had provided clear warnings regardingnhis conduct to Mr. Cumberland throughout 2018 and 2019, they would have been successful in convincing this Court that Mr. Cumberland was dismissed for just cause.
Mr. Cumberland’s communications with several students are completely inappropriate regardless of the culture of the academic institution. Mr. Cumberland’s interactions with several of his colleagues are equally unacceptable. Mr. Cumberland’s insubordination demonstrated towards both Mr. Davies and Mr. Marshall is simply untenable. All these issues, if properly brought to Mr. Cumberland’s attention, and if likely ignored by Mr. Cumberland, would have easily paved the way for a just cause dismissal. However, Mr. Marshall and Mr. Davies did not take that approach and in so doing deprived Mr. Cumberland of the ability to curb his behaviour and address their concerns. Given the rigidity of Mr. Cumberland’s mindset, I find it unlikely that he could have adequately addressed their concerns if properly advised; however, he was never given the chance, and he is therefore entitled to the benefit of the doubt. For these reasons alone, I do not accept the College has met the burden upon them to establish just cause for the dismissal.
My Comments:
If there was ever a case which showed the importance of due process in proving just cause, this is the one.
In the olden days when I actually practiced law like a real lawyer, I would be asked by my employer client what it would take to build a case for just cause for a particular employee who they were having problems with.
I would ask them a simple question. Is the employee a keeper?
In other words, is this an employee who you think can improve and that you want to improve?
If yes, then you do not need me as I know zilch about how to manage employees.
If the answer is no, then let’s look at what it will cost to terminate without alleging cause. Otherwise you will have to :
- Continue to pay this employee for the period it will take for you to document sufficient warning letters. This could take months. In the meantime this incompetent employee will likely cause you to lose money, clients and have other employees quit.
- Assuming that you may have just cause but not wilful misconduct , you will still have to pay out the ESA amounts.
- You will probably be sued. You will have to pay me and we will probably settle and you will then pay out more money.
In this case the award was $48,644 for the claim and $6,700 for costs.
The cost to the Defendant of this action would likely be as follows :
Paid to Plaintiff and his counsel $55,344
Paid to Defence counsel for 9 day trial $45,000
( I am assuming $5000 per day of trial )
Total $100,344
The Recovery for the Plaintiff may be as follows:
Received from Defendant $55,344
Less Lawyers Contingency Fee of 25%. $13,836
Then Less tax withholding of 30% $12, 452
Net Received by Plaintiff $29,056
If the Plaintiff received any EI during this period, the net recovery would even be less.
If the termination had been without just cause, a likely settlement would be around 6 months lump sum. That would have cost the Employer $45,500 and the the Employee would have received after tax around $31,850.
Instead the Employer probably paid $100,000 and the employee probably got $29,000.
Does this make sense to anyone ?
If you would like a copy of this case, email me at barry@barryfisher.ca
If you like to book a mediation or an arbitration, go to www.barryfisher.ca
This was an action from 2015 when there was no restriction on costs.
Had this action been commenced today and had the Plaintiff limited his claim to under $200,000 ,and therefore proceeded as a Simplified Procedure under Rule 76, the maximum cost award would have been $50,000 and up to $25,000 for disbursements. In most wrongful dismissal actions, disbursements are minimal.
Moreover, under Rule 76.13 (3) if the Plaintiff starts an ordinary action but recovers less than $200,000 they run a real risk that they get no cost award at all.
The lesson to plaintiffs is clear.
Unless you have a really good shot at getting an award in excess of $200,000 , do not use the ordinary procedure but rather use the Simplified Procedure. So if your notice claim alone is worth less than $200,000 but you are tempted to add a punitive damage claim for $500,000 to scare the Defendant, think twice about it.
If you like a copy of this case, email me at barry@barryfisher.ca
If you would like to book a mediation or an arbitration, go to www.barryfisher.ca