Judge Finds that Terminated Temp Employee Entitled to Remainder of One Year Contract

Written on behalf of Peter McSherry

In the recent decision in Ballim v. Bausch & Lomb Canada Inc., an Ontario judge found that a terminated temporary employee had been employed under a fixed term contract, and was therefore entitled to remuneration for the remainder of the contract.

What Happened?

The temporary employee in question, Ms. Ballim, was offered a one year contract, with benefits, at Bausch & Lomb Canada in December 2015.  She would be covering for another employee that was on maternity leave.

Approximately one month after her start date, she requested an unpaid leave of absence to travel out of the country for personal reasons. The employer approved her absence on compassionate grounds, with the understanding that Ms. Ballim would return on February 18, 2016.  Ms. Ballim did not return until February 22, 2016. Upon her return to work she was informed that she was being terminated without cause.

Based on Ms. Ballim’s length of employment of approximately three months at the time of her dismissal, the employer believed that she was entitled to one week of notice under the Employment Standards Act, however, provided her with two weeks’ pay, as well as any accrued vacation.

The Position of the Parties

Ms. Ballim claimed that she had a one year fixed term contract and was therefore entitled to recover all damages for the unexpired contract term.

The employer claimed that Ms. Ballim had been hired for an indefinite term and that she had been lawfully dismissed without cause and provided with pay in lieu of notice.

What Was the Agreement Between the Parties?

The whole of the employment agreement between Ms. Ballim and the employer was contained in the email and attached employment contract that she accepted. The email’s subject line had stated “Offer”, the body of the email stated “it is a one year contract. You will receive benefits” requesting Ms. Ballim’s signature so that the employer could get started on getting her a computer. The attached contract stated:

• that the plaintiff’s employment was on a contract basis with Bausch + Lomb, a division of Valeant Canada;
• that the plaintiff’s employment would be commencing on November 18, 2015;
• that the plaintiff would receive payment of $2,230.77 bi-weekly in 26 installments, equating to an annual         base salary of $58,000;
• that the plaintiff would be eligible for three weeks of vacation as of January 1, 2016;
• that the plaintiff would be given two days of vacation in 2015; and,
• that the plaintiff would be eligible for the defendant’s benefits program and Group RRSP.

Was the Employment Contract for a Fixed Term or Indefinite Term?

Fixed term employment contracts are the exception rather than the rule in employment relationships. As such, where a dispute arises over whether an employment contract is fixed or indefinite, the onus lies on the employee to establish that the contract is for a fixed term. In order to be considered a fixed term contract, the intention of the parties to make the agreement fixed must be unequivocal and clearly expressed.

The employer argued that there had been no certainty with respect to the length of Ms. Ballim’s employment as she had been hired as a temporary replacement for a maternity leave. Both parties knew the arrangement was temporary. Caselaw has shown that in situations where there is a temporary employee covering a mat leave, the contract is considered indefinite as the employee on maternity leave can return to work at any time.

In support of its position, the employer relied upon a British Columbia decision with similar facts, where the BC court had found that there had been no fixed term contract created. In that situation, the employee was informed she was being hired for a temporary period to cover a maternity leave. The employee relied on an email offer which stated “thank you for taking maternity leave position from December 1/08 to July 30/09” to establish that she had been hired for a fixed term. Ultimately, upon reviewing the evidence, the trial judge concluded that the plaintiff had not been hired for a fixed term as the email that the employee had been relying upon was not conclusive evidence that the contract was for a fixed term, rather than an indefinite term. More relevant evidence was the evidence from the office manager that she did not intend to employ the plaintiff for a fixed term, and would not have agreed to such a term.

The employer also relied upon another decision involving an employee who had been hired to cover a maternity leave. In that case, the court found that the contract had been for an indefinite rather than fixed term, even though the position had been found to be a “temporary contract position” that was “not to exceed 18 months”.

The Decision

Justice Lederman considered both decisions the employer was relying upon, and found they were each distinguishable from the facts at hand. In the BC decision, there had been no written contract, and the email confirming the maternity leave coverage had been sent after the employee had already accepted the position. In the other decision, the term of the contract was for “12-18 months” and the parties had agreed that three months’ notice of termination would be given to the employee if the employee on leave returned before the 18 months elapsed.

The Judge examined the specific facts of the matter before him and found that:

• The email clearly stated that the work would be a “one year contract”
• The employment agreement indicated that the employment is on a contract basis
• The agreement stipulated that the employee would be paid in 26 installments equivalent to an annual base salary of $58,000
• There was no indication in either the email or the agreement that the contract could be terminated earlier or without notice
• There was no “entire agreement” clause in the employment agreement.

He ultimately found that the parties had entered into a binding one year contract of employment. Such fixed term contracts require an employer to pay an employee to the end of the term of employment. Therefore, Ms. Ballim was owed remuneration for the remainder of her one year contract.

If you are an employee seeking legal advice following a dismissal or termination of your contract, contact Peter McSherry by phone at 519-821-5465 or by e-mail to schedule a consultation today. I can protect your rights, advocate for your best interests with employers, and ensure your case is handled properly and efficiently for a fair settlement.