Executive Summary: Key Legal and Evidentiary Issues

• Adequacy of eight months’ working notice for a senior employee with long service was disputed.

• Progressive removal of duties and relocation to an inferior office raised constructive dismissal claims.

• Plaintiff’s credibility questioned regarding vacation documentation, but evidence did not support alteration.

• Employer argued condonation of insufficient notice, but the court found no acceptance by silence.

• Mitigation efforts scrutinized; plaintiff’s job search deemed reasonable despite lack of success.

• Counterclaim for overpayment of vacation, statutory holidays, and dues was dismissed for lack of proof.

Facts and outcome of the case

Background of employment
The plaintiff, Fraser William Reid, was employed as the controller at Allied Plumbing Heating & Air Conditioning Ltd. for over eight years. He held a senior role with wide-ranging financial and administrative responsibilities and was paid an annual salary of $80,000 along with benefits. On October 26, 2022, Allied gave him notice that his employment would end on June 30, 2023, providing eight months of working notice.

Changes during working notice
Although Allied promised that terms and conditions of employment would remain unchanged during the notice period, the plaintiff’s responsibilities were gradually stripped away. By early 2023, he had lost almost all core duties associated with the controller role. In April 2023, he was moved to an isolated, inferior office, which reinforced his belief that the company no longer intended to be bound by the employment contract. On April 3, 2023, the plaintiff asserted he had been constructively dismissed and left employment.

Legal issues before the court
The court considered whether the eight months of notice was reasonable, whether the plaintiff had been constructively dismissed, whether aggravated damages should be awarded, whether he failed to mitigate his losses, and whether the employer’s counterclaim for overpayments had merit.

Court’s findings
The court held that eight months was not reasonable notice for a senior 63-year-old employee with over eight years of service. Instead, 15 months was appropriate. It found that the plaintiff had indeed been constructively dismissed due to the cumulative removal of his duties and the move to an inferior office. His mitigation efforts were reasonable, as he applied broadly for roles within and beneath his qualifications, but age and market conditions limited his prospects.

Damages and costs
The plaintiff was awarded damages equivalent to 15 months’ salary, reduced only by the prorated portion of his CPA membership fees for July to December 2023. The claim for aggravated damages was rejected, as the employer’s conduct, though imperfect, was not unduly insensitive or abusive. The defendant’s counterclaim for overpayment of vacation, holiday pay, and dues was dismissed. Having substantially succeeded, the plaintiff was also awarded his costs.