Mitigation - Articles & Videos
Does a Dismissed Employee Have an Obligation to Return to Work in Order to Mitigate their Damages? It Depends!
All employees who are dismissed have a duty at common law to mitigate their damages by finding comparable replacement employment as quickly as possible.
You might know that employees have a legal obligation to mitigate their damages when they are let go, which means they must make reasonable efforts to find new employment. However, what does “reasonable efforts” even mean?
In this video update, Stuart talks about mitigation, or the legal obligation employee’s have to find new employment if they are let go, often as part of severance discussions.
Losing a job is nerve-wrecking for most people. Employees must be careful, however, because they have a duty to mitigate their damages by taking reasonable steps to find comparable employment. Otherwise, their entitlement to damages for wrongful dismissal may be substantially reduced.
There are certain circumstances in which the duty to mitigate does not arise. The first is where there is a termination clause in an employee’s employment agreement which does not expressly require an employee to mitigate their damages during the applicable period of notice. The second is with respect to an employee’s minimum statutory entitlements under employment standards legislation, including an employee’s entitlement to notice/Termination Pay and Severance Pay, which an employee is entitled to receive regardless of their mitigation efforts.
Usually when we talk about damages for wrongful dismissal, we look at the number of months, we try to calculate what a month is worth and we take into account salary, bonuses, commission, benefits, car allowance, pension, etc. And when we negotiate a settlement, we might throw in a token amount for the cost of finding new work, but that’s usually an afterthought.