2001 McGill College
Montréal, Canada,
H3A 1G1
Telephone: (514) 286-1144
Fax: (514) 288-4773
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2001 McGill College Montréal, Canada, H3A 1G1 Telephone: (514) 286-1144 Fax: (514) 288-4773 bbminfo@bbmlex.com Home page Practice Biographies |
In its decision rendered on October 30, 1997, in Jack Wallace v. United Grain Growers Limited, an action originating in Alberta [but which may serve as a model to follow in Quebec (Farber v. Cie Trust Royal), [1997] 1 R.S.C. 846], the Supreme Court clarified certain issues relating to the termination of employment.
Among the issues which will attract particular attention include certain declarations of principle relating to the manner in which an employee is dismissed; these issues may shake up certain practices in the workplace.
Up until now it has been the practice for certain employers to abruptly announce the termination of employment and to require, on the spot, the signature of a release and discharge from the terminated employee, in consideration for an often minimal compensatory payment [which often could be qualified as insufficient] as a substitute for a notice and any other sum due to the employee.
In other words, in the past, in exchange for the payment of a minor sum, which the employer otherwise threatened not to pay, the employer dismissing the employee received an undertaking from its newly dismissed employee, which had the effect of completely preventing said employee from obtaining compensation or any remedy following the loss of employment.
This method to proceed seems destined, if not to disappear, then at least to be regulated in a manner so that its most negative effects would be eliminated.
Reprising certain previous decisions in the area of labour law, the Supreme Court reiterated that the employment contract is one which, in many respects, can be distinguished from an ordinary contract, in that one of its principal distinguishing characteristics is with respect to the relative inequality of the parties; this inequality underlies all the facets of the employer-employee relationship. When this relationship is ruptured, the employee is the most vulnerable and therefore needs the most protection.
Therefore, according to the Court, in order for employees to benefit from adequate protection at the moment of dismissal, employers must assume an obligation of good faith and of equitable treatment in the dismissal, in that any violation of this obligation must be compensated by an increase in the period of the notice [or the corresponding indemnity].
Admitting that it is difficult to precisely determine the extent of this obligation of good faith and of equitable treatment, the Court held however that the employer must at least display a certain level of openness, reasonableness and honesty with respect to the employee and therefore avoid using lies and deception, or even acting in an inflexible manner.
Interestingly enough, this decision will shed some new light in Quebec on article 2092 of the Civil Code, which contains a rule particular to Quebec law, by proscribing any waiver by the employee of his or her right to obtain compensation for the prejudice suffered, when the termination of employment is too abrupt [without sufficient notice] or done in an abusive manner.
This rule that many interpreted up until now as being limited only to stipulations made prior to dismissal, that is, those made generally at the moment of hiring, risks being read and interpreted differently from now on.
It seems that this decision from the Supreme Court will serve as a basis to argue that this form of waiver of the employee's rights is not only to be prohibited at the level of hiring, but also at the moment of dismissal, in light of the particularly vulnerable situation in which the employee may find himself at that moment.
To summarize the two issues at hand:
| (1) | A dismissal occurring in inequitable or abusive circumstances risks strongly increasing the cost for the employer and the financial compensation terms to be paid to the employee; |
| (2) | Moreover, the signing of a release and discharge obtained in such a context risks also, at least in Quebec, of not having the desired effect of eliminating the recourses available to the dismissed employee. |
In this light, certain practical suggestions should be considered to avoid various problems and to mitigate the financial consequences linked to the loss of employment:
| 1. | Be sensible and considerate in the context of a dismissal, whatever the cause may be; |
| 2. | All demands to sign a release and discharge should be written and include a note to the effect that the employee benefits from a delay to reflect (5 to 7 days), as well as a strong suggestion to obtain counsel; |
| 3. | Draft this document or any other document addressed to the dismissed employee, his or her colleagues and any other interested parties, in an appropriate matter, particularly by demonstrating reserve, respect and consideration for all the circumstances; |
| 4. | In the event that the dismissal takes place for reasons which do not justify an immediate discharge, offer without condition financial, moral and logistical support to assist the employee's reintegration into the work force; |
| 5. | Include in any release and discharge an express confirmation that the employee had all the time necessary to reflect and the opportunity to obtain counsel, and that he or she grants a release and discharge in a clear, detailed and final manner [drafted preferably by an expert in the field]; |
Even if this manner of proceeding does not provide an absolute guarantee against any recourses by the employee, perhaps it will serve to eliminate the principal causes thereof.
