In the recent case of Nykoliation v 244755 Alberta Ltd. (Pertium Group), 2026 ABCJ 103, the Alberta Court of Justice ruled that the Plaintiff employee was hired for a fixed term of employment and awarded her damages for the period remaining on her fixed-term contract after her termination of employment.
While the Plaintiff was substantially successful in this matter, the Defendant employer did score some “wins”, as the Court rejected the Plaintiff’s argument that the Defendant was required to reimburse her for the costs she incurred in finding her own accommodations and rejected her claim for punitive damages.
This case should be interesting for litigators, as it provides a fairly comprehensive overview of the principles governing fixed-term employment contracts in Alberta.
Another interesting aspect of this case was that it dealt with an application by the Defendant to have the Plaintiff held in civil contempt. Contempt applications are very rare in employment law, and this case emphasizes the extremely high burden which a moving party faces in making out such an application.
Facts
The relevant facts summarized by the Court are as follows:
- The Plaintiff employee Lesia Nykoliation was a red seal welder who normally resided in Alberta.
- The Defendant was an Alberta corporation which had an agreement with Ron-Pol Industries (Ron-Pol) to provide welding services at Ron-Pol’s shop in Kitimat, BC. Ron-Pol was not named as a defendant.
- The plaintiff had an interview with the Defendant’s CEO, Michael Brown ( Brown), on May 24, 2023.
- On May 24, both parties signed a contract of employment (the Employment Contract), which held that the Plaintiff was to be an employee of the Defendant, but was to work out of Ron-Pol’s shop in Kitmat.
- The Employment Contract included a provision titled “Business-Related Expenses”, which stated: “Pertium Group will arrange accommodation or provide allowances as agreed during the term of the Project”
- The offer letter associated with the Employment Contract (the Offer Letter) stated the following: “This Contract of Employment shall be effective upon acceptance and start date of 2023-05-29 and effective for a period of one year from this date”
- The Defendant arranged for accommodation for the Plaintiff in an apartment in Kitimat (the Oceanview Apartment). The Plaintiff was not happy with this apartment, alleging, among other things that the complex was infested with insects, had serious security concerns, and multiple fire code violations. However, the Plaintiff submitted no documentary evidence in support of these claims.
- Brown stated in his testimony that the Plaintiff had never brought these concerns to his attention prior to receiving her Civil Claim, and to the best of his knowledge, the only concern ever raised to him was minor and remedied quickly.
- The Plaintiff eventually moved out of the Oceanview Apartment, and the Defendant offered her a $5/hour raise to help defray the cost of her own accommodations. The Defendant also rented her apartment for an additional five days, to allow her time to move.
- The Plaintiff’s evidence as to what happened next was highly inconsistent and often contradictory, with the Plaintiff alternately stating that she had rented or purchased a duplex (the Duplex). Ultimately, the Court concluded that the Plaintiff had purchased the Duplex and had done so because she wanted to live with her partner and their dogs, which was not possible in the Oceanview Apartment.
- The circumstances surrounding the Plaintiff’s termination were somewhat unclear, with the Defendant initially taking the position that she had been laid off on December 1, 2023. Ultimately, the Defendant conceded at trial that her employment had been terminated on a without-cause basis on December 12, 2023.
- The plaintiff sued for wrongful termination, seeking the unexpired portion of the fixed-term contract as damages. She also sued for the costs of the Duplex she moved into and for punitive damages.
- Approximately three months after the completion of the trial, the Defendant commenced an ex parte application to have the Plaintiff held in civil contempt (the Ex Parte Application)
Analysis
Fixed vs. Indefinite Term
The Plaintiff testified that she understood the Employment Contract to be for a fixed term, and that once she successfully passed her probationary period, her employment would be secured for a year. Among other things, she argued that she would not have uprooted her life and moved to a new apartment without having job security.
The Defendant’s position was that the Employment Contract was for an indefinite term, arguing among other things that the without-cause termination provision (the Early Termination Provision) in the Employment Contract was a “hallmark” of a contract of indefinite employment.
The Court found that the language in the Employment Contract was unambiguous, stating clearly that Plaintiff’s employment “will be effective for a period of one year from May 29, 2023”. In any event, the Court found that even if there was ambiguity, it was required to resolve any such ambiguity in favor of the Plaintiff.
The Court found further support for this position at other points in the Employment Contract, noting that the Non-Solicitation Provision made reference to a “term of employment”.
The Court also rejected the Employer’s argument that the Early Termination Provision was a “hallmark” of an indefinite employment relationship, noting that while such provisions are more common in indefinite employment contracts, they certainly exist in fixed-term contracts as well.
Having concluded that the Plaintiff’s employment was for a fixed term, the Court turned its attention to the Termination Provision, which required the Defendant to provide the Plaintiff:
“ . . . only with his/her notice or payment in lieu of notice, severance pay (if applicable), and all other entitlements as required by the provincial Employment Standards legislation. The Employee shall receive all benefits or other entitlements that she/he may be entitled to at the time of termination for the full notice period as specified by the applicable provincial Employment Standards legislation.
The Court deemed the Early Termination Provision to be ambiguous, and thus unenforceable, on the following grounds:
- it made reference to “provincial Employment Standards legislation”, but did not make it clear whether the referenced legislation was that of Alberta or British Columbia;
- it made reference to “severance pay”, when such a term is not found in the Employment Standards legislation of either Alberta or British Columbia. In the view of the Court, this reference to “severance pay” could thus be interpreted as opening the door to common law damages, as the Termination Provision had already provided for statutory notice/pay in lieu;
- it was unclear whether the final sentence of the Early Termination Provision was meant to provide for something different or more than what was discussed in earlier sections, as among other things, the final sentence provides for “benefits” and “other entitlements” without stipulating what those are.
Having concluded that the Early Termination Provision was unenforceable, the Court found that the Plaintiff was entitled to the balance of the payments owing under the Employment Contract for the unexpired portion of the fixed-term, which it assessed at $51,709.92.
The Court also found that, if it was incorrect that the Employment Contract was for a fixed term, the Plaintiff would have been entitled to 2 months reasonable notice of termination.
The Court then moved to the issue of mitigation, nothing that, per Rice v. Shell Global Solutions Canada Inc., 2019 ABQB 977, mitigation of damages is required for a fixed-term contract, absent a contractual provision to the contrary.
The Plaintiff’s evidence with respect to her mitigation efforts was far from ideal, as she provided no documentary evidence in support of the 103 jobs she claimed to have applied for. Nevertheless, the Court accepted the Plaintiff’s testimony regarding the efforts she had made, noting that this evidence was at times supported by the testimony of Mr. Brown (who indirectly conceded at trial that the job market in Kitimat was poor).
The Plaintiff stated that she had earned some income working odd jobs after her termination, but kept no record of her earnings, as she was paid in cash. In view of this, the Court inferred that she had earned $3,000 per month for the months of March, April, and May of 2024. [and reduced the damages…???]
Reimbursement for Accommodations Expenses
As discussed above, the Court concluded on the basis of both the Plaintiff and Mr. Brown’s evidence that her alleged concerns regarding the Oceanview Apartment were not substantiated, and that she moved to the Duplex so that she could live with her partner and dogs.
The Court found that the Employment Contract required the employer to arrange for accommodation, and it did just that. As a result, the Court rejected the Plaintiff’s claims for reimbursement of her mortgage expenses.
Punitive Damages
The Plaintiff requested $10,000 in punitive damages. While she did not clearly plead any independent actionable wrongs, the Court found from her evidence that she was essentially alleging the following:
- that the Defendant uprooted her from her life only to terminate her employment 6 months later;
- that it provided her with substandard accommodation, ignored her concerns regarding same, and forced her to find her own accommodation; and
- that it terminated her without proper notice, severance, or pay in lieu.
The Court noted first that the wrongdoing as alleged by the Plaintiff was more suitable for a claim of aggravated, rather than punitive damages. However, as these damages were not pleaded, the Court went on to consider whether the Defendant’s conduct warranted an award of punitive damages.
The Court rejected this claim, finding that while it had made a clumsy attempt at an improper layoff and was seemingly frustrated with the Plaintiff, its conduct was not malicious, high-handed, or outrageous.
Contempt Application
At the Ex Parte Application, the Defendant argued that the Plaintiff should be held in civil contempt and her Civil Claim struck, as her evidence at trial was “evasive, indirect, confusing and on multiple occasions contradictory”.
The Court began its analysis by noting that, as set out in SLA v TJA, 2026 ABKB 16, the moving party in a contempt application is required to prove the essential elements of contempt beyond a reasonable doubt:
[116] To find civil contempt, the applicant must establish the following things beyond a reasonable doubt: (1) an existing requirement of the court; (2) notice of the requirement to the person alleged to be in contempt; and (3) an intentional act (or failure to act) that constitutes a breach of the requirement . . .” without adequate excuse” [citations omitted]
The Defendant argued that it was entitled to proceed with a contempt application ex parte, as the Plaintiff had appeared before the Court as a witness. While acknowledging that this argument was “technically accurate”, the Court expressed serious concern over the fairness of proceeding ex parte, particularly in view of the exceptional nature of contempt applications:
[51] The Defendant did not bring an application on notice to the Plaintiff to have the Plaintiff declared in civil contempt. It says it did not need to because pursuant to Rule 10.52(1), the Plaintiff was “before the Court as described in subrule (3)(a)(ii) [or (v)]” by virtue of her being a witness at the trial. While this may be technically accurate, it is certainly of concern to the Court that the Plaintiff was unaware that the Defendant was going to ask the Court to hold the Plaintiff in civil contempt and to have her Civil Claim struck or her action dismissed. As set out in Miner v Cooke[5] at para 14, “[c]ontempt has been authoritatively described as “exceptional”, and “a measure of last resort”. A conviction should “only be entered where it is genuinely necessary to safeguard the administration of justice”. […]
[52] Here, the Defendant argues that it can proceed without the necessity of an application on notice to the Plaintiff and that the Court should decide the penalty or sanction, all without any opportunity for the Plaintiff to defend or purge her contempt. This is not, in my view, fair to the Plaintiff. The Defendant had a number of months from the conclusion of the trial until the date of oral argument to at least notify the Plaintiff of its intention to ask the Court to find the Plaintiff in civil contempt. The Defendant could have − and in my view, should have − during the trial, and while the Plaintiff was “before the Court”, asked the Court to hold the Plaintiff in civil contempt if it believed it had the grounds to do so.
Ultimately, the Court found that that the application was inappropriately brought and unfair to the Plaintiff, as it provided her with no opportunity to meaningfully defend herself.
In any event, the Court found that even if the application had been brought properly, the Defendant’s arguments would fail to prove that the Plaintiff should be held in contempt.
Firstly, the Defendant failed to outline the various elements of civil contempt, instead identifying various contradictions in the Plaintiff’s testimony, and inviting the Court to draw an inference.
Secondly, the Court noted that had the Defendant believed the Plaintiff to be in contempt, the proper time to raise this concern was during the trial, when she allegedly lied in her testimony.
Finally, the Court noted that while the Plaintiff’s testimony was contradictory and confusing, this was not necessarily indicative that she was being intentionally dishonest.
My Take
Given the clear language of the Employment Contract, I was not surprised at all that the Court found the employment to be for a fixed term.
One important lesson for Plaintiff employees to take away from this case is the need to bring forward documentary evidence in support of their claims. Had the Plaintiff brought forward evidence demonstrating insect infestation, security concerns, etc., the Court may well have come to a different finding on the accommodation issue.
I was interested by the Court’s reasoning that the use of the term “severance pay” opened up the potential for an award of common-law damages, which presents a valuable lesson to employment lawyers. While it is tempting to want to “cover your bases” by making a termination provision as broad as possible, extending the language too far by including language not expressly in the statute can have the exact opposite effect.
I am not surprised at all that the Court rejected the Defendant’s application to hold the Plaintiff in contempt. It is very difficult for a moving party to succeed in a contempt application in the best of circumstances, as the “beyond a reasonable doubt” standard is much higher than the civil standard of “balance of probabilities”. Given the serous impact which a finding of civil contempt can have, it is difficult to envisage a situation where the Court would make a ruling of contempt without providing the responding party with an opportunity to answer the allegations.
The main lesson which litigators should take away from this decision is that if they want to proceed with an application for contempt, they should provide notice to the responding party, and be prepared to present exceptionally strong evidence in support.
Bow River Law provides these employment law blog posts for legal information and education purposes only. This post does not contain legal advice, and if you are in a legal situation you should speak to a lawyer directly.
