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WRONGFUL DISMISSAL - Dismissal without cause - Reasonable notice period or wages in lieu

Wednesday, March 20, 2019 @ 8:18 AM  

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Action by the plaintiff Mark Menard against the defendant Centre for International Governance Innovation (Centre) for damages for wrongful dismissal. Menard was a chartered professional accountant who the Centre hired as its Senior Director of Finance. He was the most senior employee with a specialization in finance. An employment agreement was mentioned but Menard was not presented with the agreement until his first day of work. Menard signed the agreement. The agreement provided for termination at any time for just cause, or without just cause on provision of the minimum notice required by the Employment Standards Act. Shortly after start of his fourth year, Menard's title was changed to Vice-President, Finance. His salary was increased but the job was essentially the same. During his employment, Menard used his work computer to download large amounts of copyrighted materials onto the Centre’s computers in a manner that circumvented any requirement to pay. The Centre terminated Menard’s employment after six years. The parties were not able to reach an agreement regarding a severance package and Menard commenced his action for wrongful dismissal. Menard argued that he was terminated without cause and that the notice limitation in his employment agreement was not binding. He sought damages based on a notice period of 12 to 15 months. The Centre submitted that Menard was terminated for cause and the action should be dismissed.

HELD: Action allowed in part. Menard was not dismissed for cause. It was not established that Menard's keeping of some of the Centre's electronic documents at home was improper, or that it adversely affected the Centre’s interests. Specifically, there was no evidence that the documents were placed on his home computer for anything other than work-related reasons. Menard’s use of peer-to-peer software and downloading material at work did not constitute a cause for dismissal without notice. While that activity violated one or more of the Centre's internal policies, there was no nefarious intent, and indeed Menard made no attempt to hide what he was doing. His delinquencies were not incompatible with the continuation of the employment relationship, as he would have been compliant if spoken to about them. The Centre’s interests were not affected. The termination provision in the employment agreement was void and unenforceable due to non-compliance with the Act, and not due to other grounds. The provision set up entitlement to only minimum notice under the Act, and thereafter specifically stated that Menard waived any claim to further notice or payment or compensation. Statutory entitlements such as severance pay and benefit continuation were clearly excluded. Thus, the clause was void. Menard was entitled to 12 months’ reasonable notice. Menard made reasonable efforts to mitigate his damages. The Centre did not terminate Menard arbitrarily. It had good reason to conduct a forensic investigation into his computer use and had reasonably based its allegation of cause on the result of that investigation. Menard also sent an email to his employer after his termination, effectively seeking to blackmail the Centre into agreeing to a higher severance package. It was not an appropriate case for punitive damages.

Menard v. Centre for International Governance Innovation, [2019] O.J. No. 534, Ontario Superior Court of Justice, D.K. Gray J., February 4, 2019. Digest No. TLD-March182019007