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Wrongful Dismissal

How Wrongful Dismissal Damages are Defined and Awarded

To be wrongfully dismissed from a job means that you were terminated without cause and were not provided reasonable advanced notice or severance compensation. If you think you have been wrongly terminated, you may be entitled to wrongful dismissal damages. Under the Employment Standards Act (ESA), employees can file an employment standards complaint up to six months after dismissal. Offending employers can be brought to court for up to two years after wrongfully dismissing an employee.

Compensation for wrongful dismissal generally results in compensation in lieu of notice, general damages, and special damages. Mitigative costs such as court costs may also be awarded. Egregious examples of dismissal can include compensation for wrongful dismissal in the form of both punitive and aggravated damages. In rare cases, “lost opportunity costs” can also figure into an award.

The Employment Standards Act

Wrongful dismissal applies to almost all working people within BC. These include full- and part-time employees, domestic and foreign workers, and contractors or T4 employees. The impact of the ESA and wrongful dismissal laws can differ depending on the type of worker and their position.

Within the ESA, provisions establish the minimum requirements employers must adhere to in employment relationships. These provisions contain:

1. Guidelines for work hours
2. Minimum rates of pay
3. Overtime compensation
4. Notice of termination procedures

While the ESA sets minimums, there is no formal pre-defined amount of severance compensation an employee can receive. It is rare for ESA compensation minimums to be the established measure of an award in a wrongful dismissal case. Many employers have contracts with employees that supersede minimums. Beyond the ESA, common law employment standards exist that obligate minimum employment standards based on both expressed and implied aspects of employment agreements. It would be unusual for a judge to rely only on the ESA when determining if an employer wrongfully dismissed you.

Human Rights Infringements

Federal legislation establishes conditions of wrongful dismissal that rise to the level of human rights violations. These types of employer infractions are very serious and cases could be candidates for both punitive and aggravated damages. Individuals who are terminated on the basis of declared gender, religion, ethnicity, race, or background are considered by the Canadian government to have had their rights violated by their employer. Common examples include sexual harassment and discriminatory employment and dismissal practices. If you believe your termination was the result of discrimination, consider filing a report with BC’s Human Rights Tribunal.

Constructive Dismissal

Wrongful dismissal does not have to be an outright termination. If an employer changes the fundamental aspects of your job without notice, whether they are in a contract or not, you may have a constructive dismissal claim. Constructive dismissal occurs when position details like compensation, hours, and responsibilities are drastically changed without proper notice or a new work contract. Job details could change slowly over time or all at once.

Determining Compensation

While there is no blanket formula that dictates compensation in the event of wrongful termination, there are guidelines that the court applies to determine what compensation a person is due. Keep in mind that the following are minimum ESA compensation guidelines.

  • 1 week’s notice or pay at 3 months of employment
  • 2 weeks’ notice or pay at 1 year of employment
  • After three years of employment, you’re owed an additional week’s notice or pay for each additional year of service, for up to an 8-week maximum.

In British Columbia, claims of less than $35,000 are eligible for Small Claims Court. Claims of $5,000 or less are resolved by the Civil Resolution Tribunal.

Other Compensation

More than base pay rate is often used when determining compensation for wrongful dismissal. Other types of compensation include:

  • Bonuses
  • Stock options
  • RRSP contributions
  • Medical coverage and health benefits
  • Disability coverage
  • Life insurance

When benefits or other compensation cannot be restored outside of the employment arrangement, the court may assign their cash value and add them to general damages. A lawyer can assist you in understanding the full value of the compensation offered as part of a wrongful dismissal case.