2016 QCCQ 8750, 2016 QCCQ 8750

Ruditch c. Propak Plastics

(1979) Ltd. 2016 QCCQ 8750 COURT OF QUEBEC Small Claims Division CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL Civil Division No: 500-32-145972-156 DATE: June 6, 2016 ______________________________________________________________________ PRESIDED BY THE HONOURABLE DAVID L. CAMERON, J.C.Q. ______________________________________________________________________ GENE RUDITCH Plaintiff v. PROPAK PLASTICS

(1979) LTD Defendant ______________________________________________________________________ JUDGMENT ______________________________________________________________________ [ 1 ] The Plaintiff, Mr Gene Ruditch, a former employee of the defendant, Propak Plastics

(1979) Ltd (Propak), sues for severance of $12,650 and $2,350 in damages in connection with the termination of his employment as a vice-president of sales on September 17, 2012. [ 2 ] Mr Ruditch was employed by Propak from March 2011, initially at an annually salary $60,000 and a personal expenses allocation of $600 per month.

His salary was reduced to $45,000 after approximately one and a half year. [ 3 ] In its contestation, Propak admits that the Plaintiff was dismissed and alleges that it offered first $5,000 and then $7,000 as severance pay, which offers were rejected. [ 4 ] Propak does not allege any serious cause for the dismissal and so it becomes simply a question of establishing what the appropriate amount of compensation would be to accompany the dismissal. [ 5 ] Mr Ruditch claims total $15,000.

This amount represents approximately 11 to 14 weeks notice depending on whether expenses are included and whether the claim is based on $60,000 per year or $45,000 per year. [ 6 ] Issue the Court must determine the appropriate notice period payable to the Plaintiff in the circumstances of the case.

FACTS [ 7 ] The agreement of February 25, 2011 (P-1) states the base salary of $60,000 per year and a personal expense account of $600 per month along with three weeks vacation and a per diem for travel outside Quebec. [ 8 ] Mr Ruditch admits that he continued to work when his pay was reduced to $45,000 and he also admits that he never insisted upon being paid the personal expenses. [ 9 ] There was a meeting on February 28, 2014 where Mr Ruditch’s future with Propak was discussed.

The president of Propak, Mr Andreas Nacke, testifies that it was his intention, going into the meeting, to impose upon Mr Ruditch a six-month transition period after which he would become a commission salesman rather than an employee earning a salary. He admits however that, at the meeting, he agreed to keep the current status in place for the time being pending Mr Ruditch’s accomplishment of certain sales objectives that were discussed.

More particularly, Mr Ruditch had been working on bringing in some new accounts that would have been lucrative. [ 10 ] Despite certain efforts and apparent results by August 2014, Mr Nacke and his controller decided that the employment based on the salary would have to end and they hoped to convert Mr Ruditch’s working conditions so that he would be taking a draw against a commission with no guaranty, instead of a salary. [ 11 ] The account that Mr Ruditch had attempted to bring in was rejected because it was too much of a business risk: the business in question would not have been able to pay its accounts promptly. [ 12 ] When the parties met, a letter dated August 29, 2014 (P-3) was presented to Mr Ruditch for his signature.

This document was essentially a new agreement effective September 2, 2014 providing for remuneration on a strictly commission basis. Mr Ruditch would be providing his own vehicle. As an incentive, though, Propak offered to sell him the car it had previously provided to him for the nominal amount of $500.

[ 13 ] There would be a draw against anticipated commissions not to exceed $5,000 over what he had earned any given time. [ 14 ] Mr Ruditch did not accept the agreement and opted to treat the change of conditions as a dismissal and his employment came to an end. [ 15 ] On September 9, 2014, Mr Ruditch proposed a severance package (P-4) totalling $13,230.

Mr Ruditch proposed, in addition to the severance package, to continue to work with a base salary of $35,000 and other modalities. [ 16 ] This proposal was not accepted and Propak turned the matter over to an attorney who wrote on October 10, 2014 (P-5) a proposal, complete with argument, for severance of $1,730.76. The litigation ensued.

Analysis [ 17 ] The formal defence is simply a denial of the Plaintiff’s entitlement to a notice period as substantial as the 11 weeks he is claiming. [ 18 ] At the hearing, the defence was along the lines of an allegation that the employment was actually terminated with six months notice that is to say that at the meeting of February 2014, Mr Ruditch was told that six months hence his status would be changed to that of a commission salesman.

The evidence did not establish that such a definite change was imposed nor that Mr Ruditch accepted it; it was more of an indefinite commitment to look at the situation again in approximately six months and, in the meantime, to maintain his status as before. [ 19 ] So, when the change of condition was definitely imposed in August, it was treated by Mr Ruditch as a termination.

The employment was effectively terminated with the obligation that Propak pay reasonable notice. [ 20 ] The Court takes into account that Mr Ruditch had approximately 20 years of experience in the field, was given the title of vice- president of sales, that he had a substantial salary package, initially of $60,000 per year with certain fringe benefits and that he was given autonomy in the way that he was to do his work. [ 21 ] He did not manage a sales team, however, despite the title vice-president of sales.

But he was hired on the expectation of a management position. [ 22 ] The Court also takes into account the fact that the employment did last three and a half years and that this is a fairly specialised field involving plastic custom-made packaging.

It would not be easy for a senior employee such as this to relocate quickly in a comparable job. [ 23 ] Mr Ruditch was not able to find comparable employment during the period which he claims as a notice period, despite reasonable efforts. [ 24 ] In the Court’s view, a period of three months notice would have been appropriate but it would have been based upon the salary that Mr Ruditch was actually earning of $45,000 per year.

This amounts to $11,250. [ 25 ] The Plaintiff is not entitled to any claim for stress nor should he be given a compensation for a promised expenses account if he in fact never used it. [ 26 ] Propak may take from the amount awarded the necessary deductions at source as required by law. FOR THESE REASONS, the Court : CONDEMNS the Defendant to pay the Plaintiff, as a notice of dismissal, the amount of $11,250 together with interest at the legal rate and the additional indemnity provided for in

article 1619 of the Civil Code of Quebec from October 3, 2014 plus judicial costs in the amount of $200.00. __________________________________ DAVID L. CAMERON, J.C.Q Date of hearing: February 8, 2016