We often tell our clients that the reasonable notice period is a bridge to another role, not a windfall for a dismissed employee. Notice is meant to support an employee until they find a job, and its length is based on the Court’s estimation of how long it will take the employee to do so.
For that reason, individuals generally don’t get to “double-dip” by collecting severance at the same time they are being paid to work at their new job. This can come as a surprise to some people who think of severance as an entitlement to having been dismissed.
The employer must provide the bridge (the notice period), and the employee must do their best to cross that bridge by looking for a new job. This is the duty to mitigate. In a without cause dismissal the employer’s main argument, apart from the length of the notice period, will be that the employee has failed to mitigate.
Showing Evidence an Employee Failed to Mitigate
Showing a failure to mitigate requires that the employer show:
- the employee has not made reasonable efforts to look for work, and
- that if the employee had made these reasonable efforts to do so they would have found a job.
Where the employer can prove this the Court may reduce the employee’s notice period.
It should follow that where an employee is offered a suitable position and rejects it, the Court will deem this to be a failure to mitigate and significantly reduce the notice period. Hill v Canyon Dental Centre Ltd. demonstrates that this will not always be the outcome, and that even where the employer proves the employee failed to mitigate it may not result in a significant reduction in notice.
Hill v Canyon Dental Centre Ltd.
The Facts
The employee, a dental assistant based in Calgary, worked for the employer for over fourteen years, working one day per week and earning an hourly rate of $30.00, for an average monthly compensation of $994.95 before deductions.
The employee was dismissed in October 2022 and did not begin looking for work until mid-December. Four months after dismissal the employee had only made five applications. The employee also did not look on job boards for a role and only searched Facebook dental groups.
For over a year the employee’s job search was limited to formulaic email inquiries to only nineteen potential employers. Her search was sporadic: the employee made no applications between April 26 – and September 26 of 2023. The employee kept no record of applications.
At trial the employer submitted evidence that between October 22, 2022 and December 23, 2023:
- there were 133 comparable positions posted on job boards, any one of which would have been suitable for the employee, and
- that the employee had only applied for four of these postings.
The employer also relied on testimony from Troy Gibson, who was involved in the management and hiring for three dental practices in Calgary. Mr. Gibson testified that the employee’s skills were in high demand, particularly for filling vacancies on a Saturday. Mr. Gibson had offered the employee a similar position at Odeon, one of these dental practices, on May 15, 2023, which the employee rejected. The employer argued that the rejection of this role was a failure to mitigate on the part of the employee.
Court Findings
The Court noted that it did not agree with the employer. The Court found that the employee had legitimate reasons to reject the job but noted that this showed there were available jobs. The Court held that the employee had failed to take reasonable steps towards mitigation and that the employer had demonstrated that a strong job market for similar roles existed.
The Court had set the employee’s notice period at 10 months, and discounted this to 8 months, based on the employee’s demonstrated failure to mitigate.
Takeaways
The employer did everything correctly from a litigation perspective. It produced evidence that Ms. Hill did not take reasonable steps in looking for work, and that if she had, she almost certainly would have found employment.
This is a rare instance where the Court confirmed that the employer had shown the employee had failed to mitigate. Despite this, the Court only reduced the employee’s notice period by a total of two months, relying on the timing of when the employee received the job offer from Odeon.
Given the employee’s monthly income ($994.95), it is likely the employer spent significantly more in legal fees than it saved in its notice obligations to the employee. In addition to showing what is required to prove a failure to mitigate as well as its impact, this case demonstrates the value in conducting a cost/benefit analysis by both parties and at every stage of the litigation process.
Costs/Benefits of Litigation
We discuss the cost and benefit of litigation throughout a matter with all our clients, to ensure they are maximizing the recovery and getting the most out of their legal expenditure.
If you are an employee that wishes to bring a lawsuit, we can work with you to decide the best way to bring and move your case forward.
If you are an employer that has been sued by a former employee, we can help you defend the case in a strategic and efficient manner.
If you have any questions about your situation or if you would like to get legal advice, please feel free to contact us.
