Written on behalf of Peter McSherry
Often an employer will make oral statements intended to persuade or entice a prospective candidate to join its employment.
These statements can be important for two reasons.
The first is that where the employer takes the initiative to recruit an employee from secure employment, this is known as “inducement”. This can be an important factor in increasing, often dramatically, the notice period or severance pay to which the employee is entitled on termination. The employee would be wise to keep all records of these communications and indeed should make their own notes. A reliable method of “time stamping” the creation date of these notes is to email them to yourself to allow for a third party neutral dating process.
Past cases have created firm legal precedents that oral statements can be binding and actionable or “sue-able” where the employee has relied upon the accuracy of these statements in making a decision to leave secure employment or discard other employment opportunities and take the offer as presented.
The most famous case involved an employee who moved from Western Canada to Ottawa based on the employer’s statement that it had firmly decided to proceed with a certain project for which the plaintiff employee had been hired.
Soon after arriving in his new city, he discovered that this project had been discarded. He remained employed for some time after that in alternative positions. He was later fired and offered a severance payment was set out in an employment agreement.
He successfully argued in the Supreme Court of Canada that he should be awarded damages based on this moving costs back out of Ottawa and other claims of a similar nature. This was so even though his employment contract contained a modest severance sum. The damage claim is not seen as a severance payment but rather based on what would have happened to his employment, had these representations not been made.
In this case, he would have likely refused the new offer and remained employed in his old job.
The modern decision of the British Columbia Court of Appeal also looked at this type of claim.
The employee suffered from a serious disease when he applied for the job. The long-term disability benefits were important to him. He was given a brochure which contained a provision relating to a clause requiring “proof of good health”. He was assured by the company representative that he would for full benefit coverage following three months of consecutive employment.
Soon after his employment had begun, his medical condition required an application for benefits which were approved, but not at the full entitlement level. Instead of receiving the sum of $5,000 per month, his eligible insured payment was $1,000 per month.
The plaintiff succeeded at trial in recovering the sum of $83,000.
The trial judge also allowed $10,000 in aggravated damages for mental suffering. The Court of Appeal upheld the damage award but did not agree with this award of aggravated damages.
This case, while clearly one of dramatic reliance upon the misstatement, does reflect the basic concept that oral representations in the interview process are important and may be actionable.
There are, however, ways to avoid these claims, which will be reviewed in a forthcoming post.
The issue to pay attention to is that oral or written representations, which are false or negligently made, may well be actionable. When in doubt, keep notes and be careful.
Get Advice and Know Your Rights
This issue is clearly important. Don’t worry that there may be no writing. Often oral evidence may prove the case. Get advice. Know your rights. Contact the offices of Guelph employment lawyer Peter McSherry. We can guide you through the issues, help you understand your rights, and defend your position. Contact us online or by phone at 519-821-5465 to schedule a consultation