There’s a recent wrongful dismissal case out of B.C. called Pritchard v. The Stuffed Animal House that is worth noting for a couple of reasons. The basic facts were this: Pritchard was a 16 year sales employee who was dismissed. The reason given was lack of work (a permanent layoff, in other words), and Pritchard was provided with a glowing letter of reference and 16 weeks’ pay in lieu of reasonable notice. However, Prtichard thought 16 weeks was less than ‘reasonable’ notice, so she sued for wrongful dismissal, claiming 14 months’ notice.
In the statement of defence, the employer asserted in fact it has cause to dismiss Pritchard, and therefore she was not entitled to any notice. The new grounds for cause, the employer asserted, involved wrongdoing only discovered by the employer after the dismissal. Sounds like the lawsuit prompted the employer to make like a pig, and go digging for dirt. The details of the alleged dirt discovered don’t matter, because the court rejects them all, and finds that there was no cause.
Note though that the court does find that an employer is within it’s legal right to raise new grounds for cause when facts are learned after the dismissal:
[13] It is clear that the law permits an employer to rely upon misconduct that it discovers after an employee has been dismissed to justify a summary dismissal and defend a claim for wrongful dismissal (Blomgren v. Jingle Pot Pub Ltd., 1999 BCCA 9 (CanLII), 1999 BCCA 9).
But it still needs to prove that cause, and here the employer was unable to do so. The court ordered 12 month’s notice to be paid (minus the 16 weeks’ already given).
The thing I find most interesting in this case is that the employer told the court at the trial that it believed “reasonable notice” was between 6 to 8 months. Here’s what the court says:
The plaintiff submits that a notice period in the range of 10 to 14 months would be appropriate and seeks an award at the upper end of that range, while the defendant submits that a notice period of 6 to 8 months would be more appropriate.
If the employer believed that the contract required it to pay between 6 and 8 months’ reasonable notice, then why did it only offer her 16 weeks’ notice at the time of termination?
Why does the employee have to go through the expense and stress of a lawsuit to get what she is contractually entitled to in the first place, I wonder? Or, put it another way: why does the employer prefer to pay lawyers tens of thousands of dollars in fees rather than just pay the employee the 6-8 month’s notice they believe she is contractually entitled to? Had they done so, this case likely would not have gone to court at all.
Is it wrong and unethical to knowingly provide substantially less notice than you believe is actually required by the contract? I have asked this question before, when I noted a newspaper article by a prominent employment lawyer advising employers to pay less notice than required by the contract. Here is what I wrote back then:
In this article, Levitt noted: “Generally, if an employee is provided 80% of what a court would award, it makes little economic sense to sue”. Therefore, according to Levitt, employers should “offer severance at the low end of the range or just below.”
I asked then whether this wasn’t advising employers to knowingly breach a contract, which is shady advice from any lawyer, if not worse. What do you think of an HR strategy that involves a deliberate decision to breach the employment contract (by giving “just below” the amount of reasonable notice required by the contract)?