Class actions a potent weapon for employees

By Neena Gupta
|Canadian Employment Law Today

The significant downsizing of Nortel's workforce has been on the front pages of newspapers over the last 18 months. Employees were offered severance packages based on a formula that took into account age, years of service, seniority and other factors.

Many employees chose not to litigate, even when the offers were less than what could have been achieved in court. Employees were concerned about legal fees, the delay and uncertainties inherent in the court process and the difficulties of suing a large employer.

But the litigation landscape changed significantly when Nortel terminated the employment of Robert Isaacs. Isaacs, 54, was a senior manager at Nortel terminated without cause after 33 years of employment. Nortel offered him two options: two months’ notice, a lump sum equivalent to six months’ salary and benefits and pension eligibility; or 16 months' salary in lieu of notice, subject to mitigation.