CASUAL LEGAL: Risks of Holidays Restructurings

By Anthony Purgas
Reynolds Mirth Richards Farmer LLP
Alberta Municipalities Casual Legal Service Provider

Given the recent election, it is not uncommon for municipalities to consider major restructurings, some of which involves laying off or otherwise reducing staffing. Employers, of course, have discretion to end the employment of any non-unionized staff at any time provided the employer provides or pays the employee’s contractual notice or, in the absence of a contract, reasonable notice to the employee.

A decision to terminate an employee in December carries with it additional risks. In particular, employers are expected to conduct terminations in good faith and with a reasonable level of sensitivity. If the employer acts in a way a judge would consider to be unduly harsh or insensitive, that may be damaging to the employer. There is at least one Alberta decision where Madam Justice Phillips found the timing of a termination close to Christmas does not, by itself, warrant an extension of the period of notice. However, there have been a number of decisions where an employee’s employment being terminated before the holiday season has been a factor resulting in employees receiving significant additional damages from the Court, including $75,000 in punitive damages in some cases.

The risk is not just at the December holiday season either. In a recent decision out of British Columbia, the Court awarded additional damages in lieu of notice because the employee was dismissed in June and, given his industry, the Court found that it was foreseeable that any position he might apply for may be delayed in hiring over the summer months. That is of course not the case for all employees or positions, but it must be kept in mind.

It is important for employers in general, and municipalities in particular, to always keep in mind that their employees are more than just FTEs or lines on a budget item and, when considering any reduction of staff, conduct those terminations respectfully and being mindful of all the circumstances, especially as the holiday season approaches. We strongly encourage taking the time to consider if any such staffing decision can wait until January and, if it can, to hold off on terminations until then.

To access Alberta Municipalities Casual Legal Helpline, Alberta Municipalities members can call toll-free to 1-800-661-7673 or email casuallegal [at] abmunis.ca and reach the municipal legal experts at Reynolds Mirth Richards and Farmer LLP. For more information on the Casual Legal Service, please contact riskcontrol [at] abmunis.ca, or call 310-MUNI (6864) to speak to Alberta Municipalities Risk Management staff. Any Regular or Associate member of Alberta Municipalities can access the Casual Legal Service.

DISCLAIMER: This article is meant to provide information only and is not intended to provide legal advice. You should seek the advice of legal counsel to address your specific set of circumstances. Although every effort has been made to provide current and accurate information, changes to the law may cause the information in this article to be outdated.