Rachert v. Teligence (Canada) Ltd. Date:, 2011 BCPC 8

Citation: Rachert v. Teligence (Canada) Ltd. Date: 20110118 2011 BCPC 0008 File No: No. 0928075 Registry: Vancouver IN THE PROVINCIAL COURT OF BRITISH COLUMBIA BETWEEN: JOSEPH ALLAN RACHERT CLAIMANT AND: TELIGENCE (CANADA) LTD. DEFENDANT REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE EHRCKE Counsel for the Claimant: Jitesh Mistry Counsel for the Defendant: Gradin D. Tyler Place of Hearing: Vancouver , B.C. Date of Hearing: November 22 and December 15, 2010 Date of Judgment: January 18. 2011 [ 1 ] This is a claim in wrongful dismissal. The claimant claims damages in lieu of notice.

The defendant does not allege cause, but says the amount already paid is sufficient, and that the claimant failed to mitigate his damages. FACTS [ 2 ] There is an agreed statement of facts which reads as follows: “1. The Defendant is a voice enabled social networking company with a head office located in Vancouver, British Columbia. 2. The Claimant was hired by the Defendant on November 1, 2000. 3. The Claimant’s employment was terminated without cause by the Defendant on September 17, 2009. 4. During the tenure of his employment, the Claimant held a number of job titles with the Defendant.

Prior to the termination of his employment, the Claimant’s job title was Senior Manager, Promotions and Brand Public Relations, a position which he held from April 1, 2007 until the date of his termination. 5. At the time of his termination, the Claimant was earning a salary of $93,600 per annum from the Defendant. 6.

Upon his termination, the Claimant was provided with 27 weeks’ pay in lieu of reasonable notice by the Defendant, totaling $48,600 less statutory deductions (the “Severence Package”).” [ 3 ] Thus, the claimant was employed for almost 9 years and was paid almost 7 month’s severance, the equivalent of 3 weeks for each year of service. [ 4 ] The evidence also disclosed the following. The social networking works through a telephonic system, it is a telephone chat line.

The user purchases a membership which entitles him or her to a number of minutes. The user connects to a series of messages recordedby members. If the user wishes to speak with one of the members, he or she is connected without having to give the other speaker atelephone number. The parties can talk, and decide if they want to exchange information. [5] The defendant has a number of target markets, one of which is the gay community. The defendant refers to the services for thesemarkets as brands, and the gay brand is called interactive male. The market is in the U.S. as well as in Canada.

The defendant’s job wasto come up with promotions and marketing schemes and implement them, with a focus on the interactive male brand. He initiated specialcampaigns and developed and maintained relationships with sponsors. [6] He had one person who reported to him directly, Mr. Mui. Mr. Mui did the legwork. There were several part time contractorswho would work on the promotions in different cities. Their contact was primarily with Mr. Mui but they were ultimately responsible tothe claimant.

Their work consisted mainly of attending community events and distributing free trial memberships. [7] The claimant made arrangements with suppliers and sponsors, and Mr. Mui implemented these. The claimant dealt withmanagement, and developed strategies and budgets. The budgets had to be approved by the finance committee and executive. He set theschedules, which were then organized by Mui. The claimant reported to a director of the company, and worked with the production,technical and media teams to develop plans and ensure they were feasible.

He assessed the results of the promotions, and was a memberof various management teams. [8] As an example, one of the promotions the claimant initiated was an online beauty contest, called men of 2007, men of 2008, etc. Mr. Mui worked with the website builder and managed the project implementation. Mui contacted the winners and gave the prizes underthe guidance of the claimant. [9] Tina Lai, the employer’s director of human resources, sales and customer service, said that the Senior Manager positions werecreated some time ago to retain long term employees for whom titles were important.

These positions no longer exist. There are 3 levelsof management in the company, plus the executive. The claimant was at the first level. He had one employee reporting directly to him,plus responsibility for the casual contractors. The claimant may not have realized his management level, but it was a determinant of hissalary. [10] Mr. Rachert is 46 and has a commerce degree. He has held various marketing positions. His resume is at Exhibit 1, tab 2. Hestarted with the defendant as the Junior Brand Manager for interactive male, which was similar to the job Mr.

Mui held once the claimantwas promoted, but had a tactical component. He performed that role for two years. [11] At the time of his termination, the claimant was offered a contract for 3 months, with an automatic renewal, which is at tab 3. Ithad a 10 day termination clause. It was for 20-40 hours per week at $50 per hour, with a minimum of 20 hours. It would have paid$1000 to $2000 per week. There were 3 aspects to his duties. One was to continue work on a promotion he’d planned. The other twoinvolved duties which had been performed largely by Mr. Mui, who had also been terminated. As Mr.

Mui’s manager, the claimant wasultimately responsible for this work. He testified that he considered doing Mui’s work demeaning, and also no longer knew how to do itbecause of technological changes since he had held the position, but he did not mention either of these factors at the time. [12] Mr. Rachert asked the employer to reduce his role and bring back Mr. Mui. He wanted 6 weeks work, part time, with somebusiness trips, and increased severance to 4 weeks of severance for each year of employment for both himself and Mui. The employerwanted Mr.

Rachert to be accountable for the work, and suggested he sub-contract to Mui. Ultimately, the employer rejected Mr.Rachert’s offer because of the demand for increased severance. [13] Mr. Rachert made extensive efforts to find employment starting in late October. Prior to that, he took a training program on jobsearching. He applied for numerous event management, marketing and promotion positions, and used corporate recruiters.

He finallyobtained a position in October, 2010. [14] He took a 3 day weekend holiday in September and another vacation from November 25 to December 9, both of which had beenbooked at the time of his termination. LEGAL CONSIDERATIONS AND CONCLUSIONS Reasonable Notice [15] The factors to be considered in a determination of reasonable notice include the character of the employment, the length ofservice, the age of the employee and the availability of similar employment in view of the experience, training and qualifications of theemployee: Bardal v. The Globe and Mail (1960) (ON SC), 24 D.L.R. (2d) 140 (Ont. S.C.).

These factors are notexhaustive. The purpose of the notice is to bridge the time reasonably required to find other suitable employment. [16] Counsel provided a number of cases on notice which I will review briefly. In Linsdell v. Squamish W K Enterprises Inc. 2003BCSC 188, a 52 year old manager of a fast food restaurant, who was employed for 3 years and 4 months, was awarded 6 months’severance. The court noted the broad range of court awards, and that 1 month for each year of service was a good starting point, but nomore than a guideline (para.5) [17] In Lim v. Delrina (Canada) Corp. [1995] O.J. No. 171 (Ont.

S.C.), a 42 year old chartered accountant was dismissed from hisposition of corporate controller after 6 months. He was awarded a total of 5 months’ notice, two of which reflected depressed economicconditions as well as the employer’s failure to provide a letter of reference. At para. 15 the court noted that management functions arepart of the character of the employment. [18] In Langan v. Kootenay Region Metis Assn., 2008 BCSC 1169, the plaintiff was the chief administrative officer of the defendantfor approximately 5 years. She worked for the defendant in different capacities for three years prior to that.

She was 46 at the time oftrial. The issue of cause was resolved in her favour, and she was awarded 15 months’ notice based on her skills and the nature of the

employment, and because there was no comparable work in the area. She had found new employment quickly, but for a lower salary,the amount of which was deducted from the judgment. [19] In Lee v. BICC Phillips Inc. [1997] B.C.J. No. 1282 (B.C.S.C.), the plaintiff had been a senior manager in the defendant telecomcable company for 12 years on his termination. The plaintiff rejected the employer’s offer to manage a branch of the company inIndonesia, and the court found the rejection to be reasonable (para. 39).

The plaintiff was 41 at the time of trial and had a two post-secondary degrees, one in mechanical engineering and one in commerce. His duties had included responsibility for the construction andstart-up of a cable manufacturing plant in China, and management of the employer’s plant in Nova Scotia. The court found the period ofreasonable notice was 13 months. [20] In Koos v. A & A Contract Customs Brokers Ltd. 2009 BCSC 563, the plaintiff’s position involved knowledge of the regulationsaffecting imports and exports, but did not include managerial responsibilities.

She was under 40 at the time of trial, had worked for thedefendant for 10 years and earned $50,000 per year. The court found the notice period to be 10 months. [21] In Beggs v. Westport Foods Ltd. 2010 BCSC 833, the plaintiff was aged 52, had a grade 12 education, and had worked for thedefendant for 10 years. She was dismissed and then offered to return to her employer. She was told she would be notified of heremployer’s job expectations and her schedule. The court found the period of reasonable notice to be 11 months.

The plaintiff was notrequired to accept the uncertain offer of re-employment in order to mitigate her damages. [22] In Spooner v. Ridley Terminals Inc. [1991] B.C.J. No. 3558 (B.C.S.C.), the plaintiff, the manager of human resources for thedefendant, was dismissed because of a re-organization. She supervised 3 other employees and the court found that she was in middlemanagement. Her annual salary was $97,632, $100,000 with a bonus. She was the fourth highest paid person in the company of 80employees. She was 52 at the time of termination and the length of employment was 7 years and 6 months.

There were otheremployment prospects but at lower pay. The court found the notice period was 12 months. [23] In Mukuka v. Fort Optical Ltd. [1994] B.C.J. No. 1445 (S.C.), the plaintiff’s position as manager of an optical store wasterminated when the store was closed. She was 45 and had worked for the defendant for about 12 years. She supervised one part timeemployee, and the court found she was a low level manager. Leaving aside the issue of mitigation, the appropriate notice period was sixmonths. [24] Husband v. Labatt Brewing Co., [1998] B.C.J.

No 3193 (S.C.) involved a senior sales representative, aged 41, who had workedfor Labatts for 14 years. He challenged the 10 months pay in lieu of notice given by the employer. He managed sales, maintainedinventories, and participated in marketing by retailers. He had a large sales territory. The court assessed his actual job responsibilitiesand held that he did not have management duties except to supervise a summer assistant and occasional retail testers.

Brenner J. heldthat notice of about 2.5 weeks per year was appropriate: “The defence provided the Court with a number of cases in support of its contention that 10 months was an appropriate notice period. Generally in “salesman” and “sales manager” cases the courts have consistently awarded notice in the range of 2.5 weeks per year ofservice even where the plaintiffs are in their 50’s and 60’s. The principle underlying this is the fact that the skills of sales employees areconsidered to be more readily transferrable, thus enabling them to secure new employment with relative ease…” (para. 17) [25] Coutts v.

Brian Jessel Autosports Inc., 2005 BCCA 224, is a case in which the Court of Appeal held the trial judge erred indeviating from this guideline on the basis that the plaintiff’s high income made his skills less transferable (para. 20). [26] Husband was also applied in the case of a customer service manager in Hart v. EM Plastic & Electric Products Ltd. 2008 BCSC228, in which a 25 year employee, aged 49, who supervised eight other employees was dismissed.

The court found a notice period of 15months would have been appropriate, largely because the plaintiff would have had little problem finding alternate employment in theindustry. In the event, the court found that the plaintiff had failed to mitigate his damages because he turned down several offers ofemployment and decided to pursue a career in real estate. [27] Looking at these cases together, I find that reasonable notice in the case at bar is 9 months, approximately one month per year ofemployment. The claimant did have some management responsibilities, but his supervisory duties were quite limited.

On the otherhand, this type of employment is not transferable in the same way the sales manager positions are, and the claimant is 46, has somehigher education and a fair amount of marketing expertise. Despite his efforts, it was difficult for the claimant to find alternateemployment. Mitigation [28] Although there is a duty to mitigate, the defendant bears the onus of showing a failure to do so: Michaels v. Red Deer College (SCC), [1976], 2 S.C.R. 324 (1974); Silvo, above; Coutts v. Brian Jessel Autosports, 2005 BCCA 224. The employeemust take reasonable steps to find other employment: Coutts; Carlysle-Smith v.

Dennison Dodge Chrysler Ltd. (BCSC), [1997] B.C.J. No. 3075 (B.C.S.C.). The extent to which the employer must show that, had the employee taken appropriate steps, heor she would have found employment is not entirely clear, but it appears that the court must make a determination of the likelihood offinding alternative employment: Carlysle-Smith at paras. 30 - 40. If it is unlikely the employee would have found other employment,the notice period should not be reduced.

In Carlysle-Smith, the court found that the employee had failed to follow up on a likely jobprospect and his efforts to find employment were generally insufficient, and the notice period was reduced substantially. [29] Leaving aside the issue of the employer’s offer to return to work, I am satisfied that the claimant made adequate efforts to findemployment. He gave fairly extensive evidence on the point, and Exhibit 2, tab 4 and Exhibit 5 contain details of his job search.

Whilehe waited over a month to start making applications, he took career transition workshops in the meantime, which did not end untilOctober 23. These were aimed at least in

part in assisting with his job search. Additionally, given the time and effort it took to findsuitable employment (just over a year), it seems unlikely that he would have found a position during the first month. He had also justbeen terminated from a nine year employment.

[30] The question that arises in this case is whether the claimant was required to take the work offered by his employer in mitigationof his damages. The matter is governed by the reasons of the majority in Evans v. Teamsters Local Union No. 31 2008 SCC 20. Mr.Evans was employed for over 23 years as a business agent for the union in Whitehorse. He was dismissed in January, 2003 after a newunion executive was elected. Mr. Evans had supported the losing candidate. Following this, there were negotiations about notice andsome continued employment.

Evans wanted 12 months of employment and 12 months pay in lieu of notice. During the negotiations theunion continued to pay Evans. Finally, in May, the union requested that Evans return to his employment to work the balance of thenotice period, which was to be 24 months. Evans responded by asking that his termination be rescinded. At that point negotiationsended. At trial, the court awarded 22 months notice, and found the employer had not shown a failure to mitigate.

The court also foundthat it was not unreasonable for Evans to refuse the return to work, based on a finding that his concerns about whether a return to workwould be amicable might be exaggerated but had some foundation, and therefore were not unreasonable. [31] The Yukon Court of Appeal overturned the finding on mitigation. First, Evans had not made any efforts to find otheremployment in the area. It found that Evans’ demand that his termination be rescinded was not reasonable. The court found thatobjectively, the evidence did not justify Evans’ refusal to return to work.

The Court of Appeal also disagreed with the trial judge that thedistinction between constructive dismissal cases and other dismissal cases was relevant. [32] The Supreme Court of Canada affirmed the decision of the Court of Appeal. It held that requiring an employee to return to worktemporarily was consistent with the principle that damages in these cases are compensatory, not punitive.

It also held that an offer of re-employment was the equivalent of working notice except where conditions make a return to work unreasonable on an objective view. [33] Whether a refusal to return to work is reasonable turns primarily on whether the salary is the same, the working conditions aresubstantially the same and the work not demeaning, and the employment atmosphere is not acrimonious (para. 30). Other factors whichmay be relevant are the employment history, whether the employee has started litigation, and when the re-employment offer was made.

The employee should be able to maintain his or her dignity in returning to work. The reasonableness of an employee’s failure to acceptthe work is to be assessed objectively (para. 33). The employer must show that a reasonable person in the place of the employee wouldhave returned to work (para. 35). [34] Cox v. Robertson 1999 BCCA 640 is an earlier case which is referred to in Evans. The plaintiff was a dental assistant, aged 55,who had worked with the defendant dentist three days a week for 18 years when she was dismissed because the defendant wanted a fulltime assistant.

She was given one month’s working notice. This was increased to the minimum required under the EmploymentStandards Act after the plaintiff requested 51 weeks severance pay.

After the plaintiff commenced a lawsuit, the defendant offered to re-employ her as before until she found other employment. [35] In determining that it was reasonable for the plaintiff to refuse the re-employment, the court considered the inadequacy of thedefendant’s response to the plaintiff’s request for severance, the fact that the offer of employment was not made until litigation had beencommenced, and the closeness of the particular employment relationship. [36] In Dhanoa v. M.O.S.A.I.C. Multi-Lingual Orientation Service Assn. for Immigrant Communities (BC SC),[1995] B.C.J.

No. 853 (B.C.S.C.), the plaintiff, who had worked for the defendant for many years, treated a reduction of her employmenthours by half as a termination. Although the matter proceeded by default, the defendant argued a failure to mitigate at the damageassessment hearing.

The court found that it was not unreasonable for the plaintiff to decline further employment with the defendant withher hours reduced by 50%, but that it was unreasonable not to accept further full-time employment with the defendant offered sometimelater. [37] In conclusion of the issue of mitigation, I am not satisfied the claimant was required to take the position offered by the employerin this case. Both the term and the hours were too uncertain. Given the nature of the offer, the length of that employment and theamount which would have been earned are indeterminate.

Although a witness for the employer suggested the employment would havecontinued for some time, the contract itself contained a 10 day termination clause. While the claimant did show some interest inreturning to the employer nonetheless, that was in the context of an improved severance package. I find it was not objectivelyunreasonable for the claimant to reject an offer with indeterminate hours and an indeterminate length of employment which could havebeen as short as 10 days.

On the other hand, I would note that I do not find the employment offered would have been demeaning, and theemployment environment had remained amicable. [38] Based on the above, the order will be that the defendant pay the claimant 9 months’ salary less the amount already paid, and lessany required statutory deductions, to a maximum of $25,000, together with court order interest from April 1, 2010 (the approximate datethe severance already paid would have run out) to the date of judgment, January 18, 2011. If the parties cannot agree on the amount,they are at liberty to appear to have it determined.

On the face of it, the claimant should have his reasonable disbursements against thedefendant. The parties are at liberty to appear should they wish to make submissions respecting costs.