Failure to Accept Offer During Notice Period Disentitles Terminated Employee

In a recent decision, the Ontario Superior Court of Justice found that an employee's refusal of a job offer (that had been arranged by the former employer) amounted to a total failure to mitigate, thereby disentitling the employee to any damages for wrongful dismissal.

In Gannon v. Kinsdale Carriers, the plaintiff had started work with the employer, a trucking company, in an administrative role, doing Accounts Receivable and other office tasks. However, in 2015, the employee took on dispatch duties for the company. In 2020, the COVID-19 pandemic put tremendous strain on the company (as well as many others), leading to a significant reduction of the company's business. By late 2020, the company was employing approximately 1/2 as many drivers. In December, employees were given notice in accordance with the Canada Labour Code that the business would be permanently closing on December 31, 2020. Shortly before the closure, however, the owner of the business had arranged for the employee to meet with the owners of another trucking company. There was discussion about a role that involved dispatch with the other company, but subsequent to meeting with the potential employer, the plaintiff sent a text message declining. It took her approximately 7 months to find another job, and she commenced a wrongful dismissal claim in the meantime.

The employer argued that the plaintiff had failed to mitigate her damages by declining an offer of comparable employment with the other trucking company. For her part, the plaintiff gave evidence that the meeting was "exploratory in nature" and that no job offer was made. Moreover, the employee claimed that the other role was a full-time dispatcher position, and was not, therefore, comparable with her role that she asserted was primarily administrative with some dispatch duties. After hearing the evidence, including the testimony of two representatives of the other company who said a job offer had been made, the judge rejected the plaintiff's evidence as "incredible". The judge found that during the meeting in late December 2020, the company had made an offer of a job that was comparable to what she had with the defendant employer, including the same wages, hours and duties (as the defendant's owner had insisted). Had there been no offer, there would have been no need for the plaintiff to send a text message declining. In addition, the judge found that both the former role and that offered by the potential employer had a similar mix of dispatch and administrative duties, and that the offer was not for a role that was full-time dispatch, relying on the evidence of the other witnesses who contradicted the plaintiff.

In the result, the judge found:

An offer of comparable employment was extended by Zehr on December 29, 2020. Sharon chose to reject it, to her detriment. Failure to mitigate has been proven. Sharon is not entitled to reasonable notice damages.

In addition to dismissing the claim, the judge awarded the defendant its costs.

For employers, the moral of the story is that, if you can assist a departing employee in finding new, comparable employment, it is very much in your best interests to do so. Ensuring that the terms and conditions of the new employment are truly similar is critical, but if an exiting employee then chooses to not accept an offer, the upside is significant for the employer.

Need advice on how to best conduct terminations, while mitigating the risks of wrongful dismissal and other claims? Contact Lance@ceaserworkcounsel.ca for expert guidance.

Operating as Ceaser Work Counsel since early 2014, Lance Ceaser is a 20+ year management-side labour and employment lawyer operating from London, Ontario, where he resides with his lovely spouse, 2 dogs and 2 cats. Lance has provided timely, cost-effective advice to organizations of all sizes in virtually every sector of industry and the public sector throughout his career.