Employee Mitigation Lawyers Calgary

What is mitigation?

If an employee is advancing a claim for wrongful dismissal or constructive dismissal, they have an obligation to take all reasonable steps to secure comparable alternative employment. This is referred to as mitigating damages.

Reasonable notice damages are not awarded to an employee in a wrongful dismissal situation as recognition for past employment. Rather, they are compensation for the time it is estimated that an employee might be out of work looking for a new job. An employee is obligated to start that job search once they are unemployed. They cannot sit by, not look for work and then claim the full amount of their notice period at trial. The notice period is the amount of time the court thinks it will take the individual in question to find comparable employment.

What steps are required by an employee to mitigate their damages?

Mitigation is a major factor in most wrongful dismissal cases. Satisfying the duty to mitigate requires the employee to make reasonable efforts to secure comparable alternative employment. The courts do not require a standard of perfection when assessing mitigation.

Employees are expected to search for similar employment suited to their experience, expertise and standing within their industry; they are not expected to take a position outside their industry or well-below their qualifications. The question of what constitutes reasonable efforts by the employee depends on the facts of each case.

Sometimes an employee may be required to mitigate their damages by accepting a reduced position with their former employer. In these cases, the court asks whether a reasonable person would have found continued employment with the former employer wholly untenable.

It is a prudent idea for a dismissed employee to document their mitigation efforts and job search. This information will be used in the litigation process.

How does the employer prove a failure to mitigate?

The employer has the onus to prove a failure to mitigate. This means the employer must prove not only that the employee failed to mitigate, but that the employee would have secured alternate employment had they properly mitigated their damages.

What if the employee obtains alternate employment within the notice period?

If an employee advancing a claim for wrongful dismissal obtains alternate employment within the period of reasonable notice, earnings from this new employment will be deducted from the award of pay in lieu of notice.

For example, if the court determines that an employee is entitled to $25,000 in reasonable notice damages (typically less statutory deductions), any income from the employee’s new job obtained during that notice period will be deducted from any damages award. The courts are not awarding reasonable notice damages to punish a former employer but rather are concerned with estimating, given all the relevant factors, how long it will likely take the employee to find a new job.

If a dismissed employee obtains a comparable new job, with a similar salary to their old one, immediately after being dismissed, it is likely they will not be entitled to any reasonable notice damages (statutory pay under employment standards legislation may still be awarded). In that situation, the employee will have completely mitigated their loss.

Navigating the duty to mitigate can be difficult when an employee is faced with new job opportunities and uncertainty whether they are obligated to take a position or not. An employment lawyer can assist with this issue.

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