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Potential Damages in Wrongful Dismissal

Today I want to talk about the potential damages that you can recover in a wrongful dismissal claim.

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.

A recent decision out of Ontario, however, confirms that in the right circumstances that can have a significant value. In fact, in Robinson v. Heinz, the amount was over $45,000 to compensate the plaintiff for her costs of finding new work. Why were they so high? In that case, she found that it would be best for her to move back to southwestern Ontario in order to find new work, and the court found this was reasonable, because in this case she had relocated from Southwestern Ontario, her home, to Toronto, at the request of the defendant, Heinz, and it was perfectly reasonable for her to find that her best odds of finding new work would be to go back home where she had her deep roots and contacts. So in that case, she was entitled to compensation for some of the expenses, such as land transfer tax, and other expenses incurred in selling her home and buying a new home, costs of commuting until she had a new home, meals, hotels, etc. – and again that was over $45,000.

So just a brief note for employers to keep in mind that if you’re going to let someone go, don’t only look at “severance”, but look at other damages that might be appropriate in the right case, and if you’re an employee that is looking for new work, you have a duty to mitigate by making a reasonable effort to find new work. If it will be reasonable to incur costs of relocation, for example, you may well be entitled to compensation or reimbursement for those costs, so don’t walk away until you assess those, and of course see an employment lawyer, get proper legal advice, and don’t leave money on the table.

Thanks, have a great day.

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