Moffatt v. Prospera Credit Union, 2021 BCSC 2463

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Moffatt v. Prospera Credit Union, 2021 BCSC 2463 Date: 20211217 Docket: S37905 Registry: Chilliwack Between: Brenda Moffatt Plaintiff And Prospera Credit Union Defendant Before: The Honourable Madam Justice Walkem Reasons for Judgment Counsel for the Plaintiff: A. Cline Counsel for the Defendant: N. Cuthill Place and Dates of Hearing: Chilliwack, B.C. August 18 & 19, 2021 Place and Date of Judgment: Chilliwack, B.C. December 17, 2021 [ 1 ] This is an application for

summary judgment for damages stemming from Ms. Moffatt’s (the “Plaintiff”) without notice termination from her employment with Prospera Credit Union (the “Defendant”). Background [ 2 ] The Plaintiff was employed with the Defendant as a Financial Services Associate under different contractual arrangements before her termination. The total length of the Plaintiff’s employment, from casual, part-time, and full-time contracts, was just under one year and 10 months (or 22 months). [ 3 ] The Financial Services Associate position has no managerial responsibilities.

Financial Services Associates greet members at the branch, assist members with daily banking transactions (such as ATM deposits, night deposits, bank drafts, and fund transfers), inform members about digital and self-serve channels for daily banking transactions, provide credit card solutions to members, and inform members of promotions and special offers. [ 4 ] The Plaintiff commenced casual employment with the Defendant as a Financial Services Associate at their Sardis branch on July 31, 2018. She worked at this position for approximately eight months.

Part-Time Contract [ 5 ] Around April 1, 2019, the Plaintiff was offered a part-time position (the “Part-Time Contract”). [ 6 ] The Part-Time Contract set out:

a) An hourly wage rate of $17.79 per hour;

b) Notice requirements per

section 22: “Prospera may terminate your employment at any time without cause by providing you with a notice (‘Notice Period’), or at Prospera’s sole discretion, payment in lieu of notice which will take into consideration your age, tenure, position, and employment market opportunities.”

c) Accrual of wellness days at a rate of 5% of regular hours worked for each pay period;

d) Eligibility for group health benefits after three months;

e) Eligibility for the group pension plan after two years;

f) Eligibility in Prospera’s Variable Pay Plan after one year from the original hire date, which also provided that the employee must be employed at the time of payment in order to be eligible for variable pay; and

g) Vacation eligibility of 4%. [ 7 ] With respect to the Variable Pay Plan, Buffy-Lynne Boyer, the Defendant’s People Experience Business Partner, gave evidence that this is generally paid to employees if the company reaches certain financial thresholds, based on employees’ roles, and reflects a percentage of an employee’s earnings. This was typically paid in late March or early April. The condition of the Variable Pay Plan was that a person must be employed when paid out per the contract. There is no evidence that the Plaintiff received any variable pay.

The Plaintiff worked under the Part-Time Contract for approximately four weeks (just under one month). During that time, the Plaintiff worked an average of 38 hours per week under the Part-Time Contract. Term Full-Time Contract [ 8 ] On April 18, 2019, the Defendant offered the Plaintiff full-time employment for a fixed term to fill in for a temporary parental leave absence that was anticipated to end on July 31, 2020 (the “Full-Time Contract”). [ 9 ] The Full-Time Contract set out:

a) An annual salary of $35,731.22 per annum, less deductions;

b) The Plaintiff’s hours would be based on a full 37.5-hour work week;

c) Wellness days would accrue at a rate of 0.5 days per each pay period worked;

d) The Plaintiff would be entitled to 10 vacation days per year;

e) The Plaintiff would be eligible to participate in the Variable Pay Plan, a discretionary profit-sharing plan, at the maximum rate of 6% of her annual salary;

f) The Plaintiff would be restrained from soliciting the Defendant’s clients for six months; and

g) Paragraph 22 stated “Prospera may terminate your employment at any time without cause by providing you with the following notice (the ‘Notice Period’), or at Prospera’s sole discretion, payment in lieu of notice: 1 months’ notice per completed year of service to a maximum of 12 months total”. [ 10 ] The Plaintiff worked under the Full-Time Contract from April 29, 2019 until May 20, 2020, the date of her termination. [ 11 ] Both the Full-Time Contract and the Part-Time Contract contained an express term that they superseded any prior employment agreement between the parties. [ 12 ] Unlike the Part-Time Contract, the Full-Time Contract did not contain any terms specifying a certain period of employment before eligibility in this plan.

The Plaintiff notes that, despite being employed under the Full-Time Contract from April 2019 until her termination in May 2020, and despite the Full-Time Contract specifying that the Plaintiff would be entitled to the Variable Pay Plan regardless of her hire date, the Plaintiff did not receive any bonus under the Variable Pay Plan in accordance with the Full-Time Contract or at all. Termination of Employment [ 13 ] On May 20, 2020, the Plaintiff arrived at the Sardis branch at approximately 8:00 a.m., and commenced her regular workday. Around 9:30 a.m., she was escorted by Assistant Branch Manager Ms.

Elizabeth (“Libby”) Moffett to a meeting room. The meeting room was across the branch from where the Plaintiff normally sat at her workstation. They walked across the lobby of the branch to get to the meeting room. [ 14 ] The branch was open, and members of the public were inside.

At the time, the branch was likely at COVID-19 capacity, with six members of the public inside, plus tellers at four wickets. [ 15 ] At the meeting, the Plaintiff’s employment was terminated by Ruth Maccan, the Branch Manager of the Sardis branch, who attended in person, and Darcy Boyd, the People Experience Business Partner, who attended by telephone. [ 16 ] The Defendant argues that the Plaintiff’s termination reflected a shift in the financial services industry to less in-person transactions and more online banking, accelerated by the COVID-19 pandemic.

Prospera merged in early January 2020 with Westminster Savings Credit Union, which required an organizational restructuring and streamlining. Several employees at the Sardis branch, including some in the same position as the Plaintiff, were terminated. [ 17 ] During the meeting, the Plaintiff was presented with a termination letter. Ms. McCann summarized the termination letter to the Plaintiff, but did not review the provisions in detail with her.

The termination letter listed a reduced notice period and doubled the non- solicitation period of the Defendant’s client clause, both to the significant detriment of the Plaintiff and benefit of the Defendant had the

Plaintiff signed it. The Plaintiff was told she was required to sign a full Release of her claims within one week of it being presented to her. [ 18 ] The termination letter stated that: “Pursuant to your employment contract with Prospera…and in accordance with the BC Employment Standards Act, Prospera will pay you a lump sum of $1,374.28…which is equivalent to 2 weeks of your pay as termination pay. Prospera will also pay you a gratuitous lump sum payment of $206.14, less required deductions, which is equivalent to 15% of your termination pay in lieu of benefits.

And further advised the Plaintiff “You are required to sign this letter and the full and general release (“Release”) attached to this letter…”. The termination letter stipulated that “under your employment contract with Prospera you must not for 12 months following the end or your employment, solicit Prospera’s clients, employees and contractors.” [ 19 ] The termination letter was prepared as part of a larger batch of termination letters.

Around the same time, the Defendant was terminating approximately 100 other employees across its operations. [ 20 ] Following her termination, the Plaintiff was visibly upset, and remembers “crying profusely”. The Plaintiff was not offered any opportunity to calm down, and was immediately required to collect her things and to leave the branch. [ 21 ] The Plaintiff was escorted across the branch, in full view of other employees and members of the public, while crying and attempting to shield her face with the termination letter. [ 22 ] Ms.

Libby Moffett described the Plaintiff as “visibly shaking”, and offered to drive the Plaintiff home or to call her a taxi, out of concern for her ability to drive, given her emotional condition. Impact [ 23 ] The Plaintiff argues that the experience was humiliating and could have been avoided had the termination occurred before the branch opened at 9:30 a.m.. The Plaintiff testified that she was emotionally upset, and cried for weeks whenever she thought about the termination.

As a result of the way she was terminated, the Plaintiff submits she suffered from significant emotional distress, including anxiety, poor sleep, tearfulness, and a worsening of her pre-existing claustrophobia. [ 24 ] The Defendant was granted leave to cross-examine the Plaintiff on her affidavit, much of which discussed the specifics and ongoing impact of her termination. I found the Plaintiff’s testimony to be trustworthy and reliable.

She was clearly emotionally impacted by recounting the details of her termination and its impact on her. [ 25 ] The Plaintiff saw her doctor at her family’s urging in January 2021, approximately seven months after her termination in May 2020. The Plaintiff testified that her family members, particularly her husband, knew she was not sleeping, and they could see how physically she was not looking like or being herself, not happy-go-lucky, constantly crying, not sleeping well. She reported symptoms of anxiety and problems with sleep due to the ending of her employment.

The Plaintiff recalls difficulty being understood by the doctor at her initial appointment because she was crying so hard. The Plaintiff introduced a letter from her doctor who prescribed medication to deal with anxiety and referred her to a psychologist. [ 26 ] In an unfortunate confluence of events, the Plaintiff suffers from severe claustrophobia and struggles with wearing a face mask, and has struggled to find alternate employment. Even thinking about wearing a mask makes her upset, and she testified that she experiences panic and anxiety at the thought.

At one point, at the height of the COVID-19 pandemic, the Plaintiff had to take anti- anxiety medication to grocery shop. From the Plaintiff’s testimony, it seemed as though the anxiety and impact of her termination and the COVID-19 pandemic became conflated. [ 27 ] The Plaintiff’s severe claustrophobia, which has worsened since the COVID-19 pandemic started, and no doubt has been negatively impacted by her termination, prevents her from wearing a mask.

This has hindered her ability to find alternate employment following her termination, particularly following the Provincial Health Order that was issued in or about November 2020, which mandated mask use in all public spaces. Issues [ 28 ] The Plaintiff argued that the Full-Time Contract is invalid for want of consideration and for ambiguity of its terms, particularly regarding the notice provisions. Further, the Plaintiff submits that the manner in which she was terminated should draw aggravated and punitive damages. [ 29 ] I have framed the issues to be decided as follows: 1.

Which employment contract applies to the Plaintiff’s employment with the Defendant? Is the Full-Time Contract invalid due to a lack of new consideration or due to the ambiguity of its notice provisions? 2. Which notice period applies to the Plaintiff’s employment? 3. Is the Plaintiff entitled to aggravated damages resulting from the manner of her dismissal? 4. Is the Plaintiff entitled to punitive damages resulting from the Defendant’s conduct in her dismissal, and in particular, the admitted errors in the termination letter?

Which employment contract applies to the Plaintiff’semployment with the Defendant? [30] It is the Plaintiff’s position that the Part-Time Contract is the applicable contract, and that the Full-Time Contract is void for lackof fresh consideration for the termination provisions and ambiguity of the terms. The Defendant argues that the Full-Time Contract isvalid, that the Plaintiff received consideration for signing it, and that its terms are not ambiguous.

Lack of New Consideration [31] The Plaintiff argues that merely providing continued employment to an employee is insufficient consideration for a newemployment contract, and that additional consideration is needed in the form of a benefit to both parties. Here, the Plaintiff argued thatthe Full-Time Contract lessened the notice requirement from the Part-Time contract, and that fresh consideration was required for thischange which benefitted the employer.

The two clauses are as follows: Part-Time Contract: Prospera may terminate your employment at any time without cause by providing you with a notice (‘Notice Period’), or at Prospera’ssole discretion, payment in lieu of notice which will take into consideration your age, tenure, position, and employment marketopportunities.

Full-Time Contract: Prospera may terminate your employment at any time without cause by providing you with the following notice (the ‘Notice Period’), orat Prospera’s sole discretion, payment in lieu of notice: 1 months’ notice per completed year of service to a maximum of 12 months total. [32] The Full-Time Contract also imposed a six-month non-solicitation clause preventing the Plaintiff from soliciting the Defendant’sclients for six months. [33] The Plaintiff argues these terms are in the Defendant’s favour and in order for a valid contract to exist, the Plaintiff would havehad to gain fresh consideration. [34] The parties disagreed about the practical changes.

The Plaintiff was now guaranteed 37.5 hours per week. She argues, however,that she was already working an average of 38 hours per week; therefore, in effect, that the switch to “full-time” employment is adistinction without a difference. [35] The Full-Time Contract established an annual salary. The Defendant produced calculations showing this amounted to a raise to$18.32 per hour.

The Plaintiff argued that her hourly wage decreased slightly from $17.79 to $17.18 under the Full-Time Contract. [36] The Plaintiff further argues that, when the Full-Time Contract ended, it was intended that the Plaintiff would return to the termsof the Part-Time Contract, and that any benefit from the time-limited Full-Time Contract was impermanent. [37] The Plaintiff argues the Full-Time Contract was an offer to continue employment with a reduced notice period and non-competition clause (both provisions to the employer’s benefit), and offered no significant benefit to the Plaintiff that would constitutefresh consideration.

Law [38] An amendment to an employment contract must provide a benefit to both parties. Continued employment alone is not enough toconstitute consideration for termination clauses: Watson v. Moore Corporation Ltd., (BC CA), 1996 CanLIl 1142 atparas. 29-31, 21 B.C.L.R. (3d) 157 (B.C.C.A.). Something more is required in the form of forbearance or some other benefit or incentiveto the employee. [39] In Singh v.

Empire Life Insurance Co., 2002 BCCA 452 the Court of Appeal found that where there was no promotion, new jobopportunity, or other advantage offered to the plaintiff, other than continued employment, there was no fresh consideration and themodified employment contract at issue was unenforceable. The Court affirmed the general principle that modification of a pre-existingcontract will not be enforced unless there is further benefit to both parties: at para. 15.

The need for consideration reflects thevulnerability of an employee dependent on their continued employment who has an inequality of bargaining power when an employeramends an existing employment contract: Hobbs v. TDI Canada Ltd., , at para. 42, 246 D.L.R. (4th) 43 (O.N.C.A.). [40] In Quach v. Mitrux Services Ltd., 2020 BCCA 25 [Quach], the Court of Appeal affirmed that, where there is no freshconsideration in the modification of an employment contract, that new contract will be unenforceable.

At para. 16, the Court of Appealquoted the trial judge’s specific comment that: I find in the case at bar that the plaintiff received no further benefit from the Second Contract; in fact, he suffered the loss of the benefitof the Term Provision, and it is guarantee of employment for a term of one year, as has he had over the first term under the Fixed-TermContract, with nothing in exchange. Counsel for the plaintiff pointed out, aptly in my opinion, that the defendants, on the other hand,received a significant benefit because they were no longer liable to the plaintiff for damages over the first term.

There is a conspicuous difference in Mr. Quach’s entitlement to damages on termination under the Fixed-Term Contract (12 months) andthe second contract, (one month). I agree with the Plaintiff that from a policy standpoint, it would lead to an unrealistic and unfair result

if the principles of fresh consideration did not apply in a situation where employment had not yet commenced but there was a subsequent contract that amended the initial expected terms of employment, as did the Fixed-Term Contract. [ 41 ] This Court in Krieser v. Active Chemicals Ltd., 2005 BCSC 1370 [ Krieser ], set out the three steps of analysis to determine if there is a fresh consideration element required when an employment contract is amended, at para. 24: First, did the Contract contain new terms which were detrimental to the plaintiff?

Second, if it did, what is required at law to provide adequate consideration for such changes to the employment relationship? Third, has the defendant established adequate consideration on the facts here? [ 42 ] If an employer wishes to amend an employment contract, it has generally been held that fresh consideration is required in the form of a benefit to both parties.

In the absence of a benefit, the contract will be unenforceable for lack of consideration. [ 43 ] In applying the test to the facts in Krieser , Justice Neilson (as she then was) found that introducing new terms that were detrimental to the employee in the form of new termination provisions and anti-competition clauses activated the first step. Second, the intention of the employer that the employee would be terminated if he refused to sign the new contract for an unknown employment period was not enough of a benefit to the employee.

An added benefit, such as greater security of employment through forbearance for a specified time, or a new term beneficial to the employee, would be adequate consideration. Third, there was nothing in the contract that conferred a benefit to the employee. There was no increase in job security, the employee was still a probationary employee, and the termination provision, while more generous than the Employment Standards Act , R.S.B.C. 1996, c. 113 during the employee’s probation, would not be advantageous when he passed his probationary period: Krieser , at paras. 25, 32, 35 . [ 44 ] In Rosas v.

Toca , 2018 BCCA 191 , which was not an employment law case, the Court of Appeal opined that consideration will not always be required to support a new contract. The Court held that consideration is a relevant, but not determinative, consideration in determining whether a new contract was formed: “[w]hen parties to a contract agree to vary its terms, the variation should be enforceable without fresh consideration, absent duress, unconscionability, or other public policy concerns, which would render an otherwise valid term unenforceable”.

In Quach , the Court of Appeal raised the question of how this new direction would impact employment law, without determining the matter. I note that in Matijczak v. Homewood Health Inc. , 2021 BCSC 1658 , Justice Verhoeven briefly commented on the applicability of Rosas , at paras. 30-31 , and was of the opinion that consideration is still required in the employment context.

Analysis – Consideration [ 45 ] The Plaintiff argues that the Full-Time Contract does not provide the Plaintiff with fresh consideration for the termination clause as there is no further benefit to the Plaintiff other than continued employment, and it is therefore unenforceable for lack of consideration. [ 46 ] If the termination clause in the Full-Time Contract is treated as an amendment to the Part-Time Contract, rather than the substitution of a new contract, the question shifts to whether it is to the detriment of the Plaintiff. [ 47 ] The Plaintiff argues that, when calculated against the average number of hours worked by the Plaintiff under the Part-Time Contract, the Plaintiff’s salary under the Full-Time Contract ($35,731.22) was effectively the same as under the Part-Time Contract (38 hours per week x $17.79 per hour = $35,153.04).

The Defendant argues the Plaintiff received increased total remuneration. [ 48 ] The Part-Time Contract obligated the Defendant to provide the Plaintiff with notice based on consideration of her age, tenure, position, and employment market opportunities. The Full-Time Contract permitted termination without cause with one months’ notice per year of service to a maximum of 12 months.

On April 1, 2019, when the Full-Time Contract was entered, this would have meant the Plaintiff had no notice eligibility, having started casual employment on July 31, 2018. [ 49 ] In the circumstances of this case, the Full-Time Contract cannot be read absent a consideration of the Part-Time Contract. The Full-Time Contract represented a temporary reassignment, and the Plaintiff’s employment remained subject to the underlying Part-Time Contract. I find the phrase in the Full-Time Contract “either party may end this agreement with one weeks’ notice.

At the end of this term position, you will return to your own or a comparable position” [emphasis added] telling. The Full-Time Contract temporarily altered the Plaintiff’s position, but the original Part-Time Contract continued. Either party could have reverted to it with a minimum of one weeks’ notice. [ 50 ] For practical purposes, the Plaintiff’s salary and hours of work remained relatively the same. The benefit, if any, to the Plaintiff was the hope that her hours would continue at the full-time level for the year, and not be subject to a sudden reduction.

In effect, the benefit to the Plaintiff was some security of weekly hours, in return for a considerable reduction in notice and non-solicitation prohibition. These terms emphasize the Plaintiff’s vulnerability. [ 51 ] The unique vulnerability of the employee must be borne in mind when considering employment contracts, and arguments that they have been replaced or amended. The Plaintiff was in her late 50s, and in a job that had no management responsibilities.

She had recently transitioned from a casual position to a Part-Time Contract (though was working full-time hours) and was being offered a Full- Time Contract for a term of approximately one year. The benefit to her was security of hours. Even though she was already working full- time hours, these hours could have been cut back under the Part-Time Contract. [ 52 ] The Defendant argues that the law is concerned with the parties’ manifested intentions, per MacMillan v.

Kaiser Equipment Ltd., 2004 BCCA 270 at para. 44 , and relies on the fact that, by executing the Full-Time Contract, the Plaintiff agreed that it superseded any prior employment agreement between the parties. [ 53 ] Under the statement in the opening paragraph of the Full-Time Contract, the term position was subject to the agreement that “[a]t the end of this term position, you [the Plaintiff] will return to your own or a comparable position”. The Part-Time Contract continued, in a temporary hibernation of sorts, and could have been reawakened by either party giving one weeks’ notice or the expiration of the term

of the Full-Time Contract. It seems to me that what was intended was a temporary assignment of the Plaintiff from her part-time positionto fill the full-time position for a specific term. When that term ended, it was intended that she return to her part-time position. [54] The Defendant points out that there are elements which indicate a new contract was entered, in particular, the new notice periodand statement that the new agreement superseded others. It does not sit well to read the clause about this contract being the totality of thecontract in light of the clear reverter clause.

If the Plaintiff had decided, for whatever reason, she would like to return to the previouscontract, and exercised that option a week earlier, she would have been entitled to different notice and been subject to less restrictions. [55] There are certainly inconsistencies between the two documents. I find on the most reasonable reading, which was most likely tohave been shared by the parties, that the Part-Time Contract (the originating contract) remained in place, despite the temporaryreassignment of the Plaintiff under the Full-Time contract.

I therefore find that it is the terms of the Part-Time Contract which govern thePlaintiff’s termination. Contract Validity – Ambiguity [56] The Plaintiff argues that, even if the Full-Time Contract is valid, the termination provisions contained within the Full-TimeContract create ambiguity and are irreconcilable with one another.

As such, the contract does not provide clear language to rebut thepresumption of common law notice and the termination provisions are unenforceable. [57] The two provisions that the Plaintiff highlights are the opening paragraph of the Full-Time Contract which states: We are pleased to offer you a role as a Term Full-Time Financial Service Associate, located at our Sardis Branch, effective April 29,2019. We anticipate this term position to last until approximately July 31, 2020. Please note that either party may end this agreementwith one weeks’ notice.

At the end of this term position, you will return to your own or a comparable position [emphasis added.] And, paragraph 22 of the Full-Time Contract which states: Termination without Cause: Prospera may terminate your employment at any time without cause by providing you with the followingnotice (the “Notice Period”), or at Prospera’s sole discretion, payment in lieu of notice: 1 months’ notice per completed year of service toa maximum of 12 months total. [58] The Plaintiff argues that the opening term of the Full-Time Contract (“either party may end this agreement with one weeks’notice”) creates an ambiguity about what the notice provision is.

Further, that if this opening statement set out the notice period, it iscontrary to the Employment Standards Act, and is therefore void ab initio for failing to comply with the minimum statutory noticeprovisions. [59] The Plaintiff argues that the language of these provisions creates ambiguity about whether termination could occur with oneweek’s or one month’s notice. [60] The Defendant argues the opening statement referenced the ability of either party to revert to the Part-Time Contract on oneweek’s notice, and was not intended to impose a one-week notice for termination. [61] The opening phrase indicates either party “may end this agreement” not “terminate employment”.

I do not accept the Plaintiff’sargument that ambiguity results from a reading of these two terms. Proper Notice [62] The Defendant argues that the Full-Time Contract is enforceable and limits the pay in lieu of notice that the Plaintiff is entitled toon termination.

In the alternative, the Defendant submits that three months is the reasonable and appropriate notice period given thePlaintiff’s position. [63] It is the Plaintiff’s position that she is entitled to reasonable notice under the terms of the Part-Time Contract in the range of fourto eight months. [64] Reasonable notice considerations under the common law were set out in Bardal v. Globe & Mail Ltd., , 24D.L.R. (2d) 140 (O.N.S.C.).

Factors to be applied in considering the appropriate notice period are: the character of the employment, thelength of the employee’s service, the employee’s age, and the availability of similar employment. [65] In McKinney v. University of Guelph, at 299, [1990] 3 S.C.R. 229, the Supreme Court stated: Barring specific skills, it is generally known that persons over 45 have more difficulty finding work than others. They do not have theflexibility of the young, a disadvantage often accentuated by the fact that the latter are frequently more recently trained in more modemskills.

Their difficulty is also influenced by the fact that many in the age range are paid more and will generally serve a shorter period ofemployment than the young, a factor that is affected not only by the desire of many older people to retire but by retirement policies bothin the private and public sectors. [66] Courts have found, in some circumstances, that short-term employees, who are dismissed within the first three years are entitledto a proportionally longer period of notice.

This has generally been justified on the basis that an employee will suffer a disadvantage inthe marketplace due to negative inferences that might be drawn: Saalfeld v. Absolute Software Corp., 2009 BCCA 18 at para. 15[Saalfeld]; Ostrow v. Abacus Management Corporation Mergers and Acquisitions, 2014 BCSC 938 at para. 42. [67] In Saalfeld, the Court of Appeal upheld an award of five months’ notice for an employee that had been employed for eight

months. In upholding that award, the Court considered the general range for short-term employees, stating at para. 15: …Absent inducement, evidence of a specialized or otherwise difficult employment market, bad faith conduct, or some other reason for extending the notice period, the B.C. precedents suggest a range of two to three months for a nine-month employee in the shoes of the respondent when adjusted for age, length of service, and job responsibility. [ 68 ] The Plaintiff relies on a number of cases to establish an appropriate range of notice periods.

Many are from other jurisdictions, or for positions very different from the Plaintiff’s. Of the cases provided by both parties, I note this range of notice periods:

a) In Pakozdi v. B & B Heavy Civil Construction Ltd. , 2016 BCSC 992 , a 54-year-old estimator with one year and two months of service received eight months’ notice, which was reduced to five months’ notice on appeal.

b) In Daoust v. JP Morgan Chase Bank National Assn., 2016 CarswellNat 568, 29 C.C.E.L. (4th) 306 [ Daoust ] , a financial service advisor with three years of service was awarded pay in lieu of three months’ notice.

c) In Fernandes v. Direct Energy Marketing Ltd., 2012 CarswellOnt 14120, 221 A.C.W.S. (3d) 871 (Ont. S.C.J.) [ Fernandes ] a 42-year- old executive assistant with two years of service was awarded damages equivalent to two months’ notice. [ 69 ] The Plaintiff submits that one of the most important factors in assessing the reasonable notice period in her case is her age. The Plaintiff was 59 years old at the time of her termination. She is nearing retirement age and will likely struggle to find alternate employment as a result. [ 70 ] The Plaintiff worked for approximately 22 months.

Her position involved assisting customers with daily banking transactions. It was not a managerial or particularly specialized role. The Plaintiff was terminated in the midst of the COVID-19 pandemic, which has generally caused an economic downturn. Her termination came in the context of a corporate restructuring, where over 100 employees were laid off.

It is reasonable to assume that these factors limited the availability of similar employment, particularly when taken together with her age. [ 71 ] Before her employment with the Defendant, the Plaintiff worked at other banks as a typist and as a receptionist for about 20 years. The Plaintiff did not search for jobs outside of the finance industry.

The Defendant argued her customer service skills should have allowed her to search for jobs outside of this industry. [ 72 ] The Defendant argues that, given the relatively short length of the Plaintiff’s employment and transferability of her public service skills to other industries, a shorter notice period is warranted. [ 73 ] The Defendant argues that the Plaintiff has an obligation to engage in a “…constant and assiduous application for alternative employment, an exploration of what is available through all means”: Besse v. Dr. A.S.

Machner Inc ., 2009 BCSC 1316 at para. 94 and that the Plaintiff has not provided details of her efforts to mitigate. [ 74 ] The Plaintiff has given evidence of her considerable distress following the termination, which has resulted in sleeplessness, depression, and social anxiety. The COVID-19 pandemic has worsened her pre-existing condition of claustrophobia, making it difficult for her to wear a mask, which is now mandatory in all public spaces and most workplaces. Despite this, the Plaintiff argued that she did apply at other financial institutions.

The Plaintiff submits that, given her distress following her termination, the general lack of employment opportunities in the midst of the COVID-19 pandemic, and her age, the reasonable likelihood of her successfully finding a position within the reasonable notice period was negligible. [ 75 ] Overall, on a consideration of the factors set out above, I award the Plaintiff three months’ pay in lieu of notice. Damages Relating to the Manner of Dismissal [ 76 ] Aggravated damages result from the manner of the dismissal, while punitive damages seek to punish the employer for their conduct: Cottrill v.

Utopia Day Spas and Salons Ltd. , 2018 BCCA 383 at para. 8 [ Cottrill ], ref’d [2018] S.C.C.A. No. 533. [ 77 ] I consider the claim regarding manner of dismissal under aggravated damages and the claim for damages regarding the termination letter errors under punitive damages.

Aggravated Damages [ 78 ] The Plaintiff argues that the manner of her dismissal and the Defendant’s breach of the obligation of good faith attracts an award of aggravated damages. [ 79 ] The Defendant argues that it has discharged all of its obligations to the Plaintiff, including its duty of good faith and fair dealing, in its termination of the Plaintiff’s employment. [ 80 ] The termination could have been done in a way that lessened the Plaintiff’s pain and suffering, if it was done outside of business hours, or in a more private location.

Following the termination, the Plaintiff was visibly shaking and crying profusely. She was not offered an opportunity to gather herself, but was required to immediately leave the branch. She had to walk through the lobby of the branch, shielding her face with her termination letter. The Plaintiff was in such a state that the Assistant Branch Manager was concerned about her ability to drive and offered to drive her home or to call a taxi. The Plaintiff was concerned about members of the public who may have seen her. She is afraid she will see them in public.

The manner of her termination has heightened the anxiety the Plaintiff experiences.

Law [ 81 ] An employee seeking to recover aggravated damages must establish two conditions: (1) the employer has breached its duty of good faith and fair dealing in the manner of dismissal, and (2) the employee suffered compensable damages as a result of the breach: Lau v.

Royal Bank of Canada , 2017 BCCA 253 at para. 17 [ Lau ]. [ 82 ] Examples of conduct that may constitute a breach of the employer’s duty of good faith and fair dealing include being untruthful, misleading or unduly insensitive in the course of dismissal, or attacking the employee’s reputation with declarations made at the time of dismissal: Wallace, at para. 98; Honda Canada Inc. v. Keays, 2008 SCC 39 at para. 59 [ Honda ].

To establish the second condition of the test, a plaintiff must prove something beyond the normal distress and hurt feelings that invariably accompany the loss of employment: Cottrill , at paras. 14-15 ; Quach , at paras. 26-27 . [ 83 ] Medical evidence is not required to establish that the employee has suffered emotional or health consequences but there must be some evidence of serious and prolonged disruption that transcends ordinary emotional upset or distress: Cottrill , at para. 18 ; Lau , at para. 49 ; Saadati v.

Moorhead , 2017 SCC 28 at para. 40 . [ 84 ] In Cottrill , the Court of Appeal found the trial judge had erred in an award of aggravated damages as the plaintiff had not provided sufficient evidence to establish her claim of mental distress. The trial judge had found that her account demonstrated that the dismissal had a profound impact on her and coupled with the employer’s conduct, the trial judge awarded aggravated damages. However, the Court of Appeal found that there was no evidence to support the claim that the dismissal had a severe impact on the employee.

The Court stated at para. 18 that: …The only evidence of mental distress is that [the employee] cried during the March meeting, following which she had to go home early because she was so upset, and that at the June meeting, she went numb and could not take anything in. The evidence of [the employee’s] reactions at the two meetings at its highest establishes a transient upset.

It falls well short of the legal standard that requires a serious and prolonged disruption that transcends ordinary emotional upset or distress. [ 85 ] The Court reversed the trial judge’s award of aggravated damages. [ 86 ] Conversely, in Hrynkiw v. Central City Brewers & Distillers Ltd., 2020 BCSC 1640 , the employee corroborated his claim of mental distress through his family doctor and his wife. His employer had accused him of misconduct, leaving him devastated and humiliated, especially considering that acts of dishonesty and fraud could have professional impacts on his career as a Chartered Accountant.

As such, the trial judge awarded him aggravated damages for the manner of dismissal: at paras. 207-210. [ 87 ] Conduct can be insensitive but not amount to “unduly insensitive”. In Sifton v. Wheaton Pontiac Buick GMC (Nanaimo Ltd.), 2010 BCSC 353 , an employee who was constructively dismissed claimed that his employer spoke to him in a manner that caused him mental distress. The Court found that, while the employer was assertive and perhaps could have handled the situation better, the employer was not intimidating the employee.

The Court dismissed the claim of mental distress in the manner of dismissal: at paras. 79, 81, 86. [ 88 ] Other cases where courts have considered what constitutes an “unduly insensitive” manner of dismissal include: • Vernon v. British Columbia (Housing and Social Development, Liquor Distribution Branch) , 2012 BCSC 133 [ Vernon ]: The employer terminated a long-time employee by calling the former employee into a meeting where she called the employee’s conduct shameful and that the employee was an embarrassment to the workplace.

The employee was given a short timeline to resign or be put on unpaid leave pending her termination. The employee was not formally terminated until a month later: at paras. 211, 373, 377. Cumulatively, this conduct warranted an award of aggravated damages. • Robertson v. Red Robin Restaurants of Canada Ltd., 1998 CarswellBC 3339 (B.C.P.C.) : An employee was terminated in a

section of a restaurant in full view of the other employees where he was the manager. While the Court found the conduct of the employer “insensitive” and “hard-nosed”, this did not amount to an award of aggravated damages. However, the position taken by the employer that it had been the employee’s choice to leave, combined with the public nature of the termination, was found to be in bad faith resulting in damages: at paras. 44, 55.

The post-dismissal conduct of the employer influenced the award, and the award of damages should be seen as more in line with punitive damages than aggravated damages. • Zadorozniak v. Community Futures Development Corp. of Nicola Valley, 2005 BCSC 26 : The employee was fired via a letter of termination which was given to him during a board meeting with all the board members present. Staff were outside the door when he left the boardroom. Board members then attempted to unplug the terminated employee’s computer and pinned him against a wall until police arrived.

The employee was then arrested on the main street of the small town. The Court found that the manner of the employee’s dismissal escalated to public humiliation, warranting compensation: at paras. 9-10, 114, 116-117, 121. [ 89 ] These cases demonstrate that the public nature of a dismissal alone is not sufficient to support a claim for aggravated damages, and must be accompanied by other reprehensible conduct by the employer.

Analysis – Aggravated Damages [ 90 ] The Plaintiff was no doubt distraught and humiliated by her sudden termination, and by the fact that she had to exit in front of customers; however, this does not rise to the level of public humiliation that would warrant aggravated damages. [ 91 ] The Defendant did not breach its duty of good faith and fair dealing in the manner of dismissal of the Plaintiff’s employment. The Plaintiff’s termination took place in a private office (albeit with a glass wall) at the Sardis branch, with only Ms. Maccan present in the room and Ms. Boyd present over the phone.

The Defendant was not unduly insensitive to the Plaintiff in the course of her dismissal, nor untruthful, or misleading about the reasons for her termination. This termination occurred as part of a larger restructuring, and two

other terminations had occurred earlier that morning at the same branch. [ 92 ] The Defendant did not criticize or chastise the Plaintiff in any way during the meeting, unlike the employers in the case law where aggravated damages were awarded. Rather, the Plaintiff was terminated due to a restructuring decision by the bank without cause. [ 93 ] The Plaintiff’s claim that she is entitled to aggravated damages due to the manner of her dismissal is not supported by the evidence.

To be entitled to aggravated damages, she would need to demonstrate that the Defendant’s conduct was reprehensible and that it caused her mental distress above the normal amount associated with the termination of employment. She has not done this. [ 94 ] The Defendant’s conduct in the manner of firing (leaving aside the erroneous termination letter, which is addressed under punitive damages) does not rise to the level of reprehensible conduct present in the case law.

Punitive Damages [ 95 ] As set out in Honda , in contrast to aggravated damages, which are compensatory, punitive damages are restricted to advertent wrongful acts that are so malicious or outrageous that they are deserving of punishment on their own: at para. 62. In Honda , the Supreme Court of Canada described the test for punitive damages at para. 68: ... this Court has stated that punitive damages should “receive the most careful consideration and the discretion to award them should be most cautiously exercised” ( Vorvis , at pp. 1104-5).

Courts should only resort to punitive damages in exceptional cases ( Whiten , at para. 69). The independent actionable wrong requirement is but one of many factors that merit careful consideration by the courts in allocating punitive damages.

Another important thing to be considered is that conduct meriting punitive damages awards must be “harsh, vindictive, reprehensible and malicious”, as well as “extreme in its nature and such that by any reasonable standard it is deserving of full condemnation and punishment” (Vorvis , at p. 1108). [ 96 ] Punitive damages may promote goals which include deterrence and denunciation: Vernon , at para. 382 . [ 97 ] The termination letter contained errors which included:

a) The notice offered to the Plaintiff consisted of two weeks’ pay in accordance with the Employment Standards Act , rather than payment consistent with either the Full-Time Contract (one month) or the Part-Time Contract (determined under standards similar to the common law);

b) A lump-sum payment of $206.14 was offered, less deductions, which was identified as a “gratuitous lump sum payment…equivalent to 15% of your termination pay in lieu of benefits”; and

c) It provided a non-solicitation provision restraining the Plaintiff from soliciting the Defendant’s business for a period of 12 months, rather than the six months provided for within the Part-Time and Full-Time Contracts. [ 98 ] The errors in the termination letter presented to the Plaintiff would have limited her entitlements and increased her obligations. By contrast, the Defendant stood to benefit from the misleading errors contained in the Plaintiff’s termination letter.

Further, had the Plaintiff signed the termination letter as presented she would have released legal claims against the Defendant. [ 99 ] The two weeks pay in lieu of notice listed in the termination letter was less than the one month the Plaintiff was entitled to under the Full-Time Contract (if that contract applied), or the notice commensurate with the Plaintiff’s “age, tenure, position and employment opportunities” set out in the Part-Time Contract (and which this Court has held to be three months’ notice in the circumstances).

The gratuitous lump sum payment was in fact less than the amounts that the Defendant owed the Plaintiff under either the Full- or Part-Time contract. The wording of the termination letter suggested that the Defendant was offering the Plaintiff a kindness (a gratuitous payment). The termination letter asserted that the Plaintiff was “required” to sign it.

Finally, the termination letter imposed a non-solicitation period of 12 months, when both the Part- and Full-Time Contracts each contained only a six month non-solicitation period. [ 100 ] The Defendant argues that it was not deliberately dishonest and misleading in the termination letter. The termination letter was not designed in bad faith to mislead the Plaintiff as alleged by the Plaintiff. The errors in the termination letter were an oversight occurring during the process of preparing over 100 termination packages for reorganized employees.

The Defendant points out that it was willing to correct the errors as soon as the Plaintiff’s lawyer pointed them out. [ 101 ] The volume of termination letters an employer issues does not lessen the obligation to ensure they are correct. There is no volume discount on correctness for termination letters. Analysis – Punitive Damages [ 102 ] When punitive damages are awarded, they should be assessed in an amount reasonably proportionate to such factors as the harm caused, the degree of the misconduct, the relative vulnerability of the plaintiff, and any advantage of profit gained by the defendant: Whiten v.

Pilot Insurance Co., 2002 SCC 18 at para. 94 [ Whiten ]. [ 103 ] The Plaintiff submits that the Defendant’s conduct in presenting her with a misleading and inaccurate termination letter constitutes misconduct worthy of punitive damages. The punitive damage objectives of deterrence and denunciation (per Whiten , at para. 94 ) are important in a situation such as this. The duty on employers to ensure that the notice provided to employees in the course of termination is in line with the individual’s employment contract is vital.

This is especially so given the unique and heightened vulnerability of employees who have just been terminated. Employees who are terminated may be understandably emotional – perhaps sad, humiliated, shocked, angry, embarrassed, and scared – to put it colloquially, an employee terminated without notice “may not be thinking straight”. They may sign termination letters presented to them without thinking and without consulting a lawyer to ensure that their rights are protected.

[ 104 ] The Defendant was undertaking a large number of terminations in a short time period. However, there is an obligation on an employer terminating an employee in such circumstances to act in good faith and reasonably. A “cookie cutter” termination letter drafted without regard to the individual circumstances of each employee falls short of the standard required. [ 105 ] The Defendant argues that the errors in the termination letter were not reprehensible, vindictive, malicious, harsh, high-handed, and egregiously objectionable, and further, that the errors were inadvertent.

The Defendant accepted and corrected the errors as soon as the Plaintiff retained legal counsel who pointed those errors out. [ 106 ] The Defendant’s argument highlights the crux of the problem. In this instance, the Plaintiff hired a lawyer. Had she not, these errors may not have been discovered and corrected.

Given the circumstances of a termination, and its highly emotionally charged nature, it is equally as likely that the Plaintiff, or others in her position, could have simply signed the termination letter. [ 107 ] This is a situation concerning recently terminated employees who are potentially significantly vulnerable, and in distress.

The Defendant’s lack of attention to detail in the termination letter, especially where the errors fall so clearly in their favour, is unacceptable, and draws an award of punitive damages. [ 108 ] I award the equivalent of two-and-one-half months’ salary to the Plaintiff in punitive damages for the errors in the termination letter. This is the amount that the Plaintiff would have lost had she signed the erroneous termination letter as presented.

Summary [ 109 ] The contract governing the Plaintiff’s employment is the Part-Time contract. The Plaintiff is entitled to notice on consideration of her “age, tenure, position, and employment market opportunities”. Here, given the circumstances of her employment, I have found that the Plaintiff is entitled to three months’ pay in lieu of notice. [ 110 ] Is the Plaintiff entitled to aggravated damages resulting from the manner of her dismissal? No. Though her termination no doubt caused upset and distress, it was not undue. Most people who are terminated could expect to experience similar emotions.

The Defendant’s actions in the manner of the Plaintiff’s dismissal (aside from the errors in the termination letter which is discussed below) did not rise to the level of attracting aggravating damages. [ 111 ] Is the Plaintiff entitled to punitive damages resulting from the manner of her dismissal, and in particular, the erroneous termination letter? Yes.

The errors that the Defendant made in the termination letter that they issued to the Plaintiff could have resulted in her signing away entitlement to additional notice, doubling the period of her non-solicitation prohibition, and releasing all claims against the Defendant. Had the Plaintiff not consulted a lawyer, her rights may have been significantly impacted. For the purposes of deterrence and denunciation, punitive damages in an amount equivalent to two-and-one-half months’ salary are assessed against the Defendant. [ 112 ] The Plaintiff is entitled to her costs in this action. “A. Walkem, J.”