Case involving Manitoba aerospace worker spotlights how courts handle notice periods when no shred of cause exists
A middle manager fired without cause or notice after 23 years on the job was awarded 18-months’ pay in lieu of notice by the Manitoba Court of Queen’s Bench.
In Northwood v. Bristol Aerospace Ltd. not only did the employer not make any attempt to allege cause but even admitted the employee was a competent and diligent worker. Such an open-and-shut case provides an interesting glimpse into how courts determine the appropriate notice periods for employees who were wrongfully dismissed.
In the landmark 1960 case of Bardal v. Globe and Mail Ltd., the court laid out a basic approach in determining what constitutes a reasonable notice of termination. In Bardal Chief Justice McRuer said:
“The reasonableness of the notice must be decided with reference to each particular case, having regard to the character of the employment, the length of service of the servant, the age of the servant and the availability of similar employment, having regard to the experience, training and qualifications of the servant.”
In the 1997 case of Wallace v. United Grain Growers Ltd., Justice Iacobucci made it clear the Bardal factors are not exhaustive. Something like a promise of job security may be relevant to the notice period. Bad-faith conduct in the manner of dismissal may also be a factor to be compensated by an addition to the notice period. In essence Justice Iacobucci confirmed an employment contract has unique characteristics that set it apart from an ordinary commercial contract.
In Northwood the court found no such evidence of bad-faith conduct. Bristol Aerospace recognized its obligation to Randall Northwood for terminating him without cause by offering to provide him with a salary continuance for 12 months and maintain some of his benefits.
But when Northwood refused to agree the offer was sufficient, Bristol cut off the salary continuance. The court said considering Bristol continued to maintain at trial its obligation was 12 months, the decision to cut off his salary continuance after six weeks could only be described as “coercive.” It said that while such a move might be considered bad-faith conduct as outlined in Wallace, it wasn’t in this case because there was no evidence the lack of income delayed Northwood’s search for new employment. Therefore, the notice period would be determined using the Bardal factors:
•The character of the employment. When he was terminated, Northwood was a program manager earning $54,000 per year. He was promoted to this position about eight months before being let go. He did not have any direct reports but managed large contracts for Bristol.
He functioned as a team leader who was responsible for the quality of the work performed and the execution of large contracts on a timely basis. He was described by human resources documents as “a member of the senior staff.”
As such the court was satisfied Northwood’s position was managerial in nature and could be properly classified as “middle management.”
The nature of his employment was also a significant factor. His entire professional career was spent with the defendant in the aerospace industry — a very specialized business. The knowledge he gained would be valuable to Bristol but would add little or no value to him as a human resource in another industry.
•The length of service. Northwood was with Bristol for 23 years. He was terminated just shy of turning 48. He was seven years short of the right to take early retirement. The court said that while a man his age may be willing to start a new career, employers may be reluctant to invest time and training in him because he has completed more than half of his normal work expectancy.
•The availability of similar employment. The court said there are very few employers in Manitoba that could benefit from Northwood’s specialized experience. That notion was confirmed by the fact he had not found a job despite applying for about 100 jobs in the 19 months since his termination.
Considering the positive references he received from the defendant the only conclusion one can draw is that the combination of his experience, training, qualifications and age did not make him attractive to employers, the court said.
Given the above factors, the court then had to determine what a reasonable award would be for Northwood.
The court found a couple of recent decisions by the Manitoba Court of Appeal particularly useful. In Gorman v. Westfair Foods Ltd. the court determined 12 months’ notice was appropriate for a 14-year managerial employee. In Kapitany v. Thomson Canada Ltd., 15 months’ notice to a 23-year employee was approved as “ordinary notice.”
Comparing the facts in Northwood’s case to those of Gorman and Kapitany, the court concluded a greater notice period was warranted for Northwood.
In Gorman the employee had only 14-years’ experience and had been put on notice that his job was insecure. Northwood had nine more years in his position and no indication his job was in jeopardy. In Kapitany both the years of service and the level of employment were comparable, but the court found distinctions existed for Northwood. Most significantly, Kapitany was not employed in a highly specialized position. In addition, although of less consequence, Kapitany had experienced some criticism of his job performance prior to dismissal and thus some notice that his job was not secure.
Thus, while the range of notice established in Gorman and Kapitany is 12 to 15 months, the facts of those dismissals support awards at the lower or mid point of the reasonable range of notice. No such facts restrain the notice to which Northwood is entitled. The court therefore awarded Northwood 18-months’ pay in lieu of notice.
For more information see:
• Northwood v. Bristol Aerospace Ltd., 2004 CarswellMan 96 (Man. Q.B.)
• Bardal v. Globe and Mail, 1960 CarswellOnt 144 (Ont. H.C.)
• Wallace v. United Grain Growers Ltd., 1997 CarswellMan 455, 1997 CarswellMan 456 (S.C.C.)
• Gorman v. Westfair Foods Ltd. (1997), 29 C.C.E.L. (2d) 373 (Man. C.A.)
• Kapitany v. Thomson Canada Ltd., 2001 CarswellMan 510 (Man. C.A.)
In Northwood v. Bristol Aerospace Ltd. not only did the employer not make any attempt to allege cause but even admitted the employee was a competent and diligent worker. Such an open-and-shut case provides an interesting glimpse into how courts determine the appropriate notice periods for employees who were wrongfully dismissed.
In the landmark 1960 case of Bardal v. Globe and Mail Ltd., the court laid out a basic approach in determining what constitutes a reasonable notice of termination. In Bardal Chief Justice McRuer said:
“The reasonableness of the notice must be decided with reference to each particular case, having regard to the character of the employment, the length of service of the servant, the age of the servant and the availability of similar employment, having regard to the experience, training and qualifications of the servant.”
In the 1997 case of Wallace v. United Grain Growers Ltd., Justice Iacobucci made it clear the Bardal factors are not exhaustive. Something like a promise of job security may be relevant to the notice period. Bad-faith conduct in the manner of dismissal may also be a factor to be compensated by an addition to the notice period. In essence Justice Iacobucci confirmed an employment contract has unique characteristics that set it apart from an ordinary commercial contract.
In Northwood the court found no such evidence of bad-faith conduct. Bristol Aerospace recognized its obligation to Randall Northwood for terminating him without cause by offering to provide him with a salary continuance for 12 months and maintain some of his benefits.
But when Northwood refused to agree the offer was sufficient, Bristol cut off the salary continuance. The court said considering Bristol continued to maintain at trial its obligation was 12 months, the decision to cut off his salary continuance after six weeks could only be described as “coercive.” It said that while such a move might be considered bad-faith conduct as outlined in Wallace, it wasn’t in this case because there was no evidence the lack of income delayed Northwood’s search for new employment. Therefore, the notice period would be determined using the Bardal factors:
•The character of the employment. When he was terminated, Northwood was a program manager earning $54,000 per year. He was promoted to this position about eight months before being let go. He did not have any direct reports but managed large contracts for Bristol.
He functioned as a team leader who was responsible for the quality of the work performed and the execution of large contracts on a timely basis. He was described by human resources documents as “a member of the senior staff.”
As such the court was satisfied Northwood’s position was managerial in nature and could be properly classified as “middle management.”
The nature of his employment was also a significant factor. His entire professional career was spent with the defendant in the aerospace industry — a very specialized business. The knowledge he gained would be valuable to Bristol but would add little or no value to him as a human resource in another industry.
•The length of service. Northwood was with Bristol for 23 years. He was terminated just shy of turning 48. He was seven years short of the right to take early retirement. The court said that while a man his age may be willing to start a new career, employers may be reluctant to invest time and training in him because he has completed more than half of his normal work expectancy.
•The availability of similar employment. The court said there are very few employers in Manitoba that could benefit from Northwood’s specialized experience. That notion was confirmed by the fact he had not found a job despite applying for about 100 jobs in the 19 months since his termination.
Considering the positive references he received from the defendant the only conclusion one can draw is that the combination of his experience, training, qualifications and age did not make him attractive to employers, the court said.
Given the above factors, the court then had to determine what a reasonable award would be for Northwood.
The court found a couple of recent decisions by the Manitoba Court of Appeal particularly useful. In Gorman v. Westfair Foods Ltd. the court determined 12 months’ notice was appropriate for a 14-year managerial employee. In Kapitany v. Thomson Canada Ltd., 15 months’ notice to a 23-year employee was approved as “ordinary notice.”
Comparing the facts in Northwood’s case to those of Gorman and Kapitany, the court concluded a greater notice period was warranted for Northwood.
In Gorman the employee had only 14-years’ experience and had been put on notice that his job was insecure. Northwood had nine more years in his position and no indication his job was in jeopardy. In Kapitany both the years of service and the level of employment were comparable, but the court found distinctions existed for Northwood. Most significantly, Kapitany was not employed in a highly specialized position. In addition, although of less consequence, Kapitany had experienced some criticism of his job performance prior to dismissal and thus some notice that his job was not secure.
Thus, while the range of notice established in Gorman and Kapitany is 12 to 15 months, the facts of those dismissals support awards at the lower or mid point of the reasonable range of notice. No such facts restrain the notice to which Northwood is entitled. The court therefore awarded Northwood 18-months’ pay in lieu of notice.
For more information see:
• Northwood v. Bristol Aerospace Ltd., 2004 CarswellMan 96 (Man. Q.B.)
• Bardal v. Globe and Mail, 1960 CarswellOnt 144 (Ont. H.C.)
• Wallace v. United Grain Growers Ltd., 1997 CarswellMan 455, 1997 CarswellMan 456 (S.C.C.)
• Gorman v. Westfair Foods Ltd. (1997), 29 C.C.E.L. (2d) 373 (Man. C.A.)
• Kapitany v. Thomson Canada Ltd., 2001 CarswellMan 510 (Man. C.A.)
