ONCA Provides Guidance on Duty to Mitigate In Wrongful Dismissal
In Lake v. La Presse, 2022 ONCA 742, the Ontario Court of Appeal overturned a motion judge’s decision that reduced an employee’s damages by two months for failing to mitigate. This case provides helpful commentary on an employee’s right to be selective in their job search and it reaffirms an employer’s obligation to provide evidence if it wishes to prove that the terminated employee did not mitigate.
La Presse is an Ontario decision, but it hails from the Court of Appeal and it should be persuasive authority in Alberta as well.
The following are the pertinent facts summarized by the Ontario Court of Appeal:
- The Appellant (“Ms. Lake”) worked for La Presse (2018) Inc., a French newspaper, for five and a half years. At the time of termination, she was 52 years old and was employed as a General Manager, with an annual base salary of $185,000, a car allowance, a yearly bonus, a pension, and other benefits.
- Lake’s primary role was to manage the sales team to generate advertising revenue. She was the most senior employee in La Presse’s Toronto Division. At one time during her career, she had as many as thirteen direct reports – at the time of termination, she had eight.
- La Presse Gave Ms. Lake two months of working notice. She remained unemployed for two years and was still unemployed at the date of summary judgement.
- The motion judge determined that Ms. Lake was entitled to a reasonable notice severance period of eight months’, but had to consider if it should be reduced by Ms. Lake’s efforts to find a replacement job (called her “duty to mitigate”).
- During the notice period (eight months), Ms. Lake applied for a total of eleven jobs, nine of which were VP roles.
Analysis / Conclusion
Summary Judgment Decision
La Presse bore the burden of proving that Ms. Lake failed to mitigate by demonstrating: (1) that she failed to take reasonable steps to mitigate her damages; and (2) that if she had done so she would have been expected to secure a comparable position adapted to her abilities.
The motion judge found that Ms. Lake was entitled to eight months’ notice. However, she reduced Ms. Lake’s award by two months for failing to mitigate. The motion judge provided the following reasons for the first stage of the mitigation analysis:
- Lake waited too long before beginning her job search (stopped work on April 30 and did not take steps until after June 30);
- Lake “aimed too high” in applying for VP roles. Ms. Lake should have applied for less senior roles that paid less as she remained unemployed, as applying for VP roles represented a promotion from the position she held with La Presse; and
- Lake waited too long before applying to any jobs, and she applied for too few jobs.
Concerning the second step, the motion judge inferred that, had Ms. Lake expanded her job search, searched earlier, and applied for more positions, her chances of obtaining a position would have improved significantly:
…Although there is no direct evidence in front of me of other positions that the [appellant] could have applied for, I find it is reasonable to assume that they existed. If vice-president roles were available, more junior roles were also available. The [appellant] chose unreasonably to limit her job search, which had a corresponding impact on her ability to find work.
Ontario Court of Appeal Decision
The ONCA agreed with the motion judge that Ms. Lake waited too long before beginning her job search but found that she erred on all other accounts. Concerning the first part of the mitigation test, the Court made the following comments on Ms. Lake’s right to remain selective in her job search:
19 The motion judge erred in principle when, at para. 65, she accepted that, in mitigation, after a reasonable period of attempting to find similar employment, a dismissed employee must begin searching for a lesser paying job […], and then, at para. 68, she concluded that the appellant should have applied for a sales representative role if she continued to remain unemployed. The obligation of a terminated employee in mitigation is to seek “comparable employment”, which typically is employment that is comparable in status, hours and remuneration to the position held at the time of dismissal […]. There was no obligation for the appellant, to seek out less remunerative work, including by working as a sales representative.
The ONCA found that Ms. Lake had taken substantial steps to mitigate. She had detailed her search efforts on job sites on nearly a daily basis, using keywords to search for jobs with comparable duties and responsibilities to her role at La Presse. Ms. Lake also made networking efforts and used career transitioning services provided by La Presse and her own private coaching.
The Court also held that the motion judge placed too much emphasis on job titles without considering their similarity with Ms. Lake’s previous role with La Presse. During cross-examination, Ms. Lake testified that she was searching for Toronto-based senior roles with management responsibilities, as this was her expertise and skill. Ms. Lake testified that the positions she applied to had these characteristics and matched her work experience and qualifications, irrespective of their title. La Presse did not offer evidence to counter Ms. Lake’s assertions. ONCA found the motion judge erred as nothing in the record supported the conclusion that Ms. Lake failed to make reasonable efforts.
Concerning the second part of the mitigation test, the ONCA found that the motion judged erred in inferring that if Ms. Lake had applied to lesser positions, she would have mitigated her damages. The Court noted that while reasonable inferences may sometimes be appropriate based on proven facts, they are not appropriate where no evidence exists on the record to draw the conclusion.
The Court noted that even if the the assumption made by the motion judge were appropriate, it did not go far enough to meet the second stage of the mitigation test anyway. Inferring that “more junior roles” were available did not conclude that Ms. Lake would have found comparable employment – only that the chances of obtaining a position would have improved.
Alberta has several authorities to similar effect as this case, but the depth of analysis in La Presse does provide useful persuasive guidance.
The Court’s decision provides important direction on two issues: (1) what courts should consider when determining what amounts to “comparable” positions, and (2) the evidence that the defendant needs to prove the plaintiff’s failure to mitigate.
Ms. Lake was a senior employee with high remuneration. The ONCA narrowed its focus on the substance of the roles that Ms. Lake applied for rather than their title. While many positions had the title of “VP,” Ms. Lake’s evidence is that she believed the roles were comparable based on her experience and skill.
Ms. Lake did not submit documentation of job descriptions for the positions she applied to; the evidence of their comparability came from her testimony during the cross-examination of her affidavit. La Presse contended that these roles were incomparable and amounted to promotion from her previous position, but it did not offer documentation to substantiate its claim. Since it was La Presse’s burden to prove that Ms. Lake failed to mitigate, the lack of evidence offered by La Presse meant there was nothing in the record to counter Ms. Lake’s testimony.
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Michael Hernandez is an employment lawyer at Bow River Law. He is a knowledgeable and skilled lawyer, handling employment law, human rights (discrimination) and labour law matters. Bow River Law is based in Calgary but we are Alberta’s Workforce Lawyers.