As an employee, if you are terminated, you are entitled to a reasonable notice period or pay in lieu of notice at common law. The notice period can be quite extensive for employees who have worked at the company for a long time and maybe even longer depending on the individual’s particular circumstances, such as their age, role, etc. It is, therefore important to determine the notice of termination date, which affects the notice period and how much compensation an employer would need to provide to the terminated employee.
This article will discuss what happens when an employer extends an employee’s termination date and how it would affect an employee’s notice period. We will discuss a critical case, Di Tomaso v. Crown Metal Packaging Canada LP, 2011 ONCA 469, which provided a key ruling on termination dates if an employer extends them. This post will provide important takeaways for employees who are facing an extension to their termination date or for employers to understand their obligations during the termination of an employee.
Regulation allows temporary work for a terminated employee
Issues concerning termination are covered by the Employment Standards Act, 2000, S.O. 2000, c. 41. There is a further regulation (O. Reg. 288/01: Termination and Severance of Employment – the “Regulation”) that sets out additional rules for terminating an employee.
In particular, at s. 6 of the Regulation:
Temporary work, 13-week period
6. (1) An employer who has given an employee notice of termination in accordance with the Act and the regulations may provide temporary work to the employee without providing a further notice of termination in respect of the day on which the employee’s employment is finally terminated if that day occurs not later than 13 weeks after the termination date specified in the original notice. O. Reg. 288/01, s. 6 (1).
(2) The provision of temporary work to an employee in the circumstances described in subsection (1) does not affect the termination date as specified in the notice or the employee’s period of employment. O. Reg. 288/01, s. 6 (2).
This means that if an employer gives notice to an employee of termination, that employee can continue to work for up to 13 additional weeks for the employer without altering the notice of termination date. This is significant, as it affects the notice period and how much compensation an employer would need to provide to an employee. An employer can essentially count that period of temporary employment towards the employee’s statutory notice entitlement, thus reducing the compensation owed.
What happens when an employer continues to extend the termination date on multiple occasions? The following Di Tomaso provides a ruling on this issue.
Employer extends termination date five times
In the Di Tomaso case, the employer, Crown Metal, was a manufacturer of metal packaging. The terminated employee was Mr. Di Tomaso, a mechanic for the company. He had worked for the company for 33 years and was 62 at the time of termination.
Crown Metal first informed Mr. Di Tomaso of his termination on September 9, 2009, and set the termination date at November 6, 2009. A few days before this termination date, on November 4, 2009, Crown Metal extended Mr. Di Tomaso’s employment by a few weeks to a new termination date of December 18, 2009.
Crown Metal extended Mr. Di Tomaso’s termination date over five months. Before each termination date, Crown Metal would inform him that they were extending his employment. Mr. Di Tomaso ultimately received five written notices of termination, which contained four different termination dates, with the last letter confirming the final termination date set out in the previous letter. Each letter indicated that Mr. Di Tomaso’s employment was being extended temporarily.
Mr. Di Tomaso was ultimately terminated on February 26, 2010. He received 26 weeks’ severance pay as per the Employment Standards Act and his accrued vacation and benefits.
Lower court finds only the last notice of termination was clear and unequivocal
Mr. Di Tomaso then filed an action, seeking 24 months’ pay for wrongful dismissal at common law.
Crown Metal claimed that the original termination notice on September 9, 2009, should be upheld, as the temporary extensions were authorized by s. 6 of the Regulation. They claimed that each of the extensions was valid, as they were less than the 13 weeks as specified by the Regulation.
Mr. Di Tomaso claimed that the extensions ought to be cumulative and were, therefore, longer than the 13 weeks permitted by the Regulation. He claimed that the final letter in February 2010 provided him with clear notice of termination.
The lower court judge found that s. 6 of the Regulation did allow an employer to count a temporary employment period towards the notice period. The lower court agreed with Mr. Di Tomaso’s interpretation that the extensions should be viewed cumulatively.
The lower court determined that where there are ambiguities in the legislation, it should be interpreted to benefit the employee, as the Employment Standards Act is meant to provide minimum standards to protect and provide certainty to employees. The court noted that notice of termination must be clear and unequivocal, and only the final letter fulfilled these requirements.
Court of Appeal upholds finding that temporary work extensions should be cumulative
Crown Metal appealed the decision.
The Ontario Court of Appeal upheld the lower court’s decision as it best fits the purpose of the legislation. In particular, if an employer was allowed to provide notice of termination but also extend the employment for multiple periods of less than 13 weeks, then this would be contrary to the purpose of the Employment Standards Act, which was enacted to protect employees. The Court of Appeal agreed with the lower court that Mr. Di Tomaso did not have certainty of his termination until the final date. Therefore, the extensions of his employment did not count towards the notice period and compensation that was required from Crown Metal.
The appeal was dismissed.
An employer can extend an employee’s employment temporarily for not more than 13 weeks. If there are further periods of temporary employment, then only the final termination date will be upheld. An employer is not permitted to continually extend an employee’s employment for periods of less than 13 weeks and claims that the termination date ought to be the original date to limit the compensation required for reasonable notice.
Contact Haynes Law Firm in Toronto for Advice on Termination and Wrongful Dismissal Claims
Our experienced employment law legal team at Haynes Law Firm in Toronto can assist you with issues that arise from termination. For employees, our goal is to ensure that they understand their rights and receive maximum compensation in wrongful dismissal cases. Haynes Law Firm also assists employers in avoiding liabilities that may arise from terminations that are not permitted by the legislation. We are dedicated to finding the best resolution for you.
To book a consultation, please contact us online or by phone at 416-593-2731.