Impact of COVID-19 on the Reasonable Notice Period
In every non-unionized employment relationship, the employer has an implied common law obligation to give the employee reasonable notice of its intention to terminate the employment relationship, unless there is just cause for termination. If the employer fails to give the employee reasonable notice of termination, the employer risks a wrongful dismissal action for breach of that implied term.
The purpose of providing reasonable notice is to allow the employee a period of time in which to secure alternative employment. Reasonable notice is decided with reference to the following key factors (known as the “Bardal Factors”):
- The character of the employment;
- The employee’s length of service;
- The employee’s age; and
- The availability of similar employment, having regard to the experience, training, and qualifications of the employee.
Further discussion on the operation of the Bardal Factors can be found here: Notice Periods for Without Cause Terminations
The COVID-19 pandemic has had a negative effect on businesses, and many were forced to temporarily lay-off or dismiss employees. Likewise, with many businesses closing or abandoning recruitment efforts, some job seekers have struggled to re-enter the workforce following termination or lay-off. Over the past seven months, courts across the country have considered the impact that COVID-19 has had on the fourth Bardal Factor (the availability of similar employment), and the reasonable notice analysis as a whole.
The following five cases are recent examples of how the courts have determined the applicable notice period in light of the COVID-19 pandemic:
Herreros v Glencore Canada, 2021 ONSC 5010: Ms. Herreros was dismissed without cause by the Company in October 2019. She urged the Court to consider the COVID-19 pandemic as a negative factor reducing her opportunity to obtain other employment, therefore justifying a lengthier notice period. In its analysis, the Court noted that the pandemic had not yet materialized at the time of Herrero’s dismissal. Given that an assessment of the Bardal Factors is to take place as of the time of termination, the Court held that the pandemic was not a relevant factor in its consideration of the fourth Bardal Factor.
Kraft v Firepower Financial Corp, 2021 ONSC 4962: Mr. Kraft was working in a highly specialized salesperson role when his employment was terminated in March 2020. The Court noted that at which point, the economy was already shutting down and remained closed during Kraft’s inevitably prolonged job search. Additionally, Kraft tendered evidence that his inability to gain alternate employment directly related to the pandemic. In light of that evidence, the Court found that Kraft deserved “to receive at least somewhat above the average notice period” (para 22). The Court assessed the reasonable notice period at 10 months, being one month more than he would have received during non-pandemic times.
Abdon v Brandt Industries Canada Ltd, 2021 SKPC 37: Mr. Abdon was dismissed for cause on February 6, 2020. While the Court in this case held that the Company did in fact have just cause to terminate Abdon’s employment, the Court assessed what he would have been entitled to had he been successful. At the time of termination, Abdon was working as a welder. At trial, the Company brought evidence that there were at least four welding jobs available in the vicinity of where Abdon resided. Accordingly, the Court held that equivalent employment was available to Abdon, who did not tender any evidence that the COVID pandemic played a negative role in his job search.
Moore v Instow Enterprises Ltd, 2021 BCSC 930: Mr. Moore, a long-term (26.5 years) employee, was dismissed from his employment as a commercial tire salesperson on a without cause basis in May 2020. The Court noted that while Moore was not entitled to greater notice simply by virtue of the COVID-19 pandemic, the current pandemic impacted the relative availability of similar employment. The Company identified a list of job postings that they submitted would have provided reasonably similar employment to Moore’s previous job. Several of these jobs were in tire sales, while others were in related industries or involved senior sales positions. Despite this evidence, the Court did not specifically comment on whether these job postings impacted its decision to award 20 months of reasonable notice. The Court did, however, consider the availability of similar employment when assessing Moore’s duty to mitigate. As Moore did not take active steps to pursue alternate employment, the Court reduced his notice period by three months.
Iriotakis v Peninsula Employment Services Limited, 2021 ONSC 998: Mr. Iriotakis’ employment was terminated on March 25, 2020, after just over two years of service. In this case, the Court agreed that the Plaintiff’s age (56) and the uncertainties in the job market at the time of termination both served to tilt the period of reasonable notice away from the fairly short period of notice that his brief tenure might have otherwise indicated. Nevertheless, the Court held that “these factors do not apply to the exclusion of the others. A balanced approach is what is called for” (para 22). The Court held that Iriotakis was entitled to three months of notice.
Reasonable notice is determined on a case-by-case basis. Despite the impact that the pandemic has had on the availability of similar employment in many industries, the law remains clear – no one Bardal Factor is given disproportionate weight in the analysis.
When considering whether the COVID-19 pandemic has impacted the availability of similar employment, the courts will consider the timing of termination. Where termination has occurred prior to the commencement of COVID-19 pandemic in Canada, courts have been less likely to consider COVID-19 as a factor influencing the notice period. Further, courts will assess the job market for a specific industry, and not the market as a whole when determining the availability of alternate employment.