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Wrongful Dismissal – Mitigation

Brake v. PJ-MR2 Restaurant Inc. 2017 Ont CA

Employee was constructively dismissed because it was unreasonable to have expected employee to accept a demotion. The judge awarded 20 months’ notice for statutory benefits and common law notice. Employer wanted earnings from the employee deducted from the damages, but the court refused to do so for the following reasons:

• Employment insurance benefits are not to be deducted.
• Income earned during the statutory entitlement period is not to be deducted. These benefits are to be paid regardless whether employee subsequently works or not.
• Employer has the onus to show that income earned during the notice period was earned after the statutory entitlement period.
• If employee was working a part-time job before being terminated, then income from a part-time job after termination is not mitigation of the full-time job that had been terminated.
• The minority went so far as to say that if income came from a job substantially inferior to the job that had been terminated, then that income does not reduce damages. The majority disagreed.

Written by Jonathan Speigel Jonathan Speigel, the founding partner of Speigel Nichols Fox LLP, leads the litigation and construction practices.