Courts Consider Factors Influencing Reasonable Notice of Termination

Written on behalf of Peter McSherry

Under Ontario’s Employment Standards Act, many employees are entitled to a fair severance package or reasonable notice of the dismissal of their employment. It may be considered a wrongful dismissal when an employer fails to provide reasonable notice or pay in lieu of reasonable notice.

What constitutes “reasonable notice” depends on the case’s specific circumstances. As we have discussed previously on this blog, the courts consider many factors when determining reasonable notice. The four main factors (also known as the Bardal factors) are:

• Age; 
• Length of service; 
• Nature of the position held; and
• The availability of similar employment. 

The courts will also consider additional factors unique to each case, including whether the employee:

• Was induced by the employer from secure employment; and
• Took appropriate steps to mitigate the damages arising from the wrongful dismissal.

In a pair of recent decisions, the Ontario Superior Court of Justice considered how other particular factors influence the amount of “reasonable” notice of termination. In particular, the cases involved workers of advanced age, short length of service, and the effect of the COVID-19 pandemic.

Cases involving same employer and similar facts heard together

The employees involved in Flack v. Whiteoak Ford Lincoln Sales Limited and its companion case Ewach v. Whiteoak Ford Lincoln Sales Limited were both in automotive sales with the same employer. Given the similarity of the facts in both cases, they were heard and decided together. Both employees were over the age of 60 and only had between nine and 19.5 months of service.

In both cases, the employees were terminated before COVID-19 lockdowns took place. The availability of similar employment likely impacted their job searches during the pandemic. 

Advanced age alone not enough reason to extend reasonable notice period

The Ontario Human Rights Commission has identified that age discrimination in the workplace – particularly “negative assumptions and stereotypes about older workers” – is a serious concern. Age has also been considered one of the main factors for courts to consider in determining reasonable notice for decades. 

However, the court recognized in the Flack and Ewach cases that age is associated with positive characteristics such as maturity, experience, and judgment. In both of these cases, the court declined to lengthen the notice period even though both employees were over the age of 60.  

The court explained that employees must do more than simply assert age as a factor when pleading age discrimination or requesting an extended notice period. The employee must demonstrate that their age influenced the employer’s decision to terminate the employee or impacted the employee’s ability to obtain comparable employment post-termination. An employee’s age alone does not entitle them to additional severance pay.

Length of service must be considered in context of nature of the role and industry

In these two cases, both employees were considered short service employees as they had worked for the employer for less than two years. In both cases, the court determined that this short service warranted a shorter notice period. 

Although the court held a shorter notice period was appropriate in these cases, the length of the employees’ service was reviewed in light of their position and the nature of their industry. Both employees have commissioned sales representatives in the automotive field. The court noted there was evidence of a high degree of employee turnover in these roles and within this field. In a different industry with fewer available roles and less turnover, a short length of service may have no effect.

In other cases, a short length of employment may warrant a longer notice period. Senior leadership or executive positions can have multi-layered recruitment processes, including interviews, background checks, and other assessments. Where a hiring process can take several months, a short length of employment may call for a longer notice period from the employer.

Economic or public health circumstances may affect reasonable notice, depending on timing

In these two cases, both employees were dismissed from their employment before the COVID-19 pandemic lockdowns. However, both employees likely experienced interruptions in their job searches due to the pandemic.

The court noted that what constitutes a “reasonable” notice period must be determined in the context of the applicable time – i.e. the circumstances “when the notice was required to be given” or “when the obligation to compensate for the failure to give notice” arose.

In other words, only factors present at the time of the termination of employment should be taken into consideration when determining the appropriate amount of notice. When the termination occurs during a downturn in the economy or a global pandemic, the court will consider those circumstances when determining the reasonable notice period. However, these circumstances may not affect the amount of notice where they occurred after the termination. In these cases, because the pandemic arose after the terminations, the court determined it could not affect the amount of reasonable notice.

Contact Peter McSherry Employment Lawyer for Advice on Reasonable Notice and Severance Packages

The amount of reasonable notice owed on termination can be affected by many common law factors, over and above the requirements of employment legislation. Peter A. McSherry Employment Lawyer assists employees seeking advice on their entitlement to an extended reasonable notice period and can review proposed severance packages. For employers, we can ensure employee dismissals and lay-offs meet all legal requirements, reducing the risk of employment litigation. Contact us online or by phone at 519-821-5465 to schedule a consultation.