Fired older employee may have reduced duty to mitigate

Job Application REJECTED

Employees who are fired and are seeking damages for wrongful dismissal must mitigate their damages by answering job ads, handing out resumes and networking. However, a recent decision of the Supreme Court of British Columbia suggests there may be a lesser onus on older workers to seek alternative work.

Edwin Dodge was 59 years old and had been employed by Signature Mazda in Richmond B.C. for just over 20 years when he was fired. He was a financial services manager who completed the paper work once a sale was made and sold auxiliary services such as rust proofing, leasing, insurance, warranty and financing options for new cars. He earned commission on these sales.

His product sales began to decline in recent years and he failed to achieve sales targets. He had eye surgery on several occasions but he fully recovered and went back to work. In July 2013 without warning, his boss handed him an envelope with a Release, Indemnity and Settlement Agreement, stating among other terms, that his employment was over at the end of the month and that he was to receive a payment of $53,208.90.

He did not sign the document, receive any payment associated with his termination or request or receive a letter of reference. He sued the company for wrongful dismissal asking for damages in lieu of notice. He asked for between 20 and 24 months’ pay in lieu of notice based on annual earnings of $126, 409 – an average of his earnings from 2008-2012.

Dodge did not prepare a resume until January 2014. By the date of trial in July 2014 he had applied for only seven positions and attended one job interview. He testified that he checked the Vancouver Sun for jobs more or less daily and posted his information on LinkedIn. He also got in touch with three or four people in the retail car industry but nothing came of these contacts. He never consulted a job counsellor or a job search company to help him.

His former employer led evidence that there were over 100 car dealerships in the Lower B.C. Mainland and most of them employ two financial services managers. Mr. Justice Macintosh agreed with Signature Mazda that Dodge did not do enough to find a new job. Nevertheless, he acknowledged that age 60, his chances of getting a new job were less than if he was 45 or 50.

Before taking mitigation into account the Judge found that 17 months pay in lieu of notice was the most reasonable award, based on applying the case law to the facts before him. He pegged Dodge’s annual earnings at $115,000 based on his average earnings from 2010-2013.

However, he only reduced the award to 14 months of pay in spite of his failure to mitigate, because he conceded that at age 60 it is less likely that he would have found another job even if he had conducted a more thorough job search.

In an article in Employment Law Today, employment lawyer Ronald Minken noted that the lesson to be learned by employees is:

“No matter how old employees may be, they are still required to knock on doors, leave resumes, ask to have lunch and take other such steps that are necessary to try and obtain new employment. However, it appears the amount of a reduction to the notice period that will occur in the event an employee fails to reasonably attempt to mitigate his/her damages will depend on the employee’s age with a lesser reduction for more senior employees.”



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