Written by David Doorey, York University
In a recent wrongful dismissal lawsuit out of British Columbia, the employer made the novel argument that “60 is the new 50” in employment law. The claim was that the long-standing presumption in the common law that employees who are terminated after the age of 50 will have a more difficult time finding alternative employment due to bias in hiring, and that this reality leans towards extending the notice period for those workers, should be “modernized”. The employer suggested that nowadays employers don’t have a bias against workers aged 50-60. What do we think of that claim?
The decision is called Mohammed v. Dexterra Integrated Facilities Management, 2020 BCSC 2008.
The employee (M) was terminated without cause after 17 months’ employment. For years he had worked for companies that provided cleaning services to buildings. In this industry, when the cleaning company loses a contract it often terminates the employees who had been assigned to the contract. That is what happened in this case. His employer lost a contract to clean a mall and as a result the employer terminated everyone who had been assigned to clean the mall.
At the time of the termination, M was 51 years old. There is a debate in the decision about whether M should be characterized as a manager or “an hourly employee in a low-level position”, as argued by the employer. The issue in the case was the amount of “reasonable notice” of termination required. The employer argued that 4 weeks’ was sufficient, while M argued he is entitled to 14 months’ notice.
Issues and Decision
A couple of points about this decision are noteworthy. By way of backgrounder for those new to Employment Law, there is an implied term in Canadian employment contracts requiring employers to provide “reasonable notice” of termination. That implied term can be overridden by an expressed contract term specifying the amount of notice required, but in this case there was no such term. Therefore, the court needs to decide how much notice is “reasonable notice”.
The court does that by considering a variety of factors known as the “Bardal Factors”, from an old 1960 decision of that name (which can be found in Box 10.3 of The Law of Work text). The most important of those factors is length of service–generally the longer an employee is employed the longer the period of “reasonable notice”. Other Bardal Factors include age of the employee, availability of similar employment, and “the character of employment”.
In the decision, the judge opens by noting that “the purpose of notice is to bridge the gap between dismissal and new employment”. The judge then moves on to consider the Bardal Factors. M had been employed only 17 months and so the judge said that the case fell within the category of “short service” cases in which “length of service is less of a predominant factor”.
Bardal Factor: Character of Employment
Turning to “character of employment”, the judge considered whether M’s job was managerial in nature. There is an old idea in the case law that people who hold managerial positions deserve more notice than non-managerial employees. The usual justification for this approach is that there are fewer managerial jobs and therefore there is less “availability of similar employment” in the labour market.
In Ontario, this approach has been questioned. In a case called DiTomoso v. Crown Metal Packaging, the Court of Appeal ruled that there is no logical reason why courts should assume that non-managerial employees deserve less notice because it is easier to find similar alternative employment. The Court ruled that each case must be considered on its own merit. Sometimes, an hourly wage employee with little education or transferrable skills, for example, will have a much harder time finding alternative employment than a manager with a fancy MBA.
None of this case law is cited in Dexterra decision. The employer argued that four weeks’ notice is appropriate because M was only an “hourly employee” whose role was “not crucial” to the employer. The judge rejected this characterization, finding that M’s role was “supervisory”, but without commenting on whether it should matter at all how M’s job is characterized.
Bardal Factor: “Age”
The other Bardal factor that is discussed at some length is “age”. The judge references studies that I describe in The Law of Work (p. 161) that suggest that employees over the age of 50 experience have a harder time finding alternative employment than younger workers and that this factor has been shown to effect lengths of notice periods. Workers terminated past the age of 50 tend to receive a reasonable notice bump of an additional few months.
The employer (with a straight face I presume!) that “60 is the new 50”, the suggestion being that people aged 50-60 don’t experience obstacles to employment in the same way that people aged 60 and over do. The judge didn’t play along:
“I will conclude with my observation that Dexterra’s submission concerning a “modern rule” departing from the dicta of the Supreme Court of Canada and long line of cases following, so that age 60 is the “new 50”, is best viewed from the remarks in Sciancamerli at paras. 24–31: each case must be determined based on individual circumstances on a case-by-case basis. Evidence of the impact of age is a factor but the traditional approach that age over 50 is seen as a potential detrimental factor to finding employment has not been discarded.”Justice Walker, Mohammed v. Dexterra Integrated Facilities Management, 2020 BCSC 2008
Ultimately, the judged ruled that M was entitled to 5 months’ reasonable notice after being terminated from his job after 17 months’ employment. Therefore, the employer was ordered to pay M five month’s wages and benefits, but from that amount was deducted: (1) the four weeks’ pay it has already provided and (2) about $12,000 that he had received in earnings from a new job he obtained after he was fired. As discussed in Chapter 14 of The Law of Work (Damages in Wrongful Dismissal Lawsuits), employees are required to mitigate their loss by looking for alternative employment. If they find new employment, the previous employer is entitled to the benefit of the earnings in the form of a lower damage award.
David Doorey, “Is “60 the New 50″ in Assessing Length of Reasonable Notice in Wrongful Dismissal Cases?” Canadian Law of Work Forum (January 13 2020): http://lawofwork.ca/?p=13225