Sep 19

Gordon v. Altus: Punitive Damages and Employer Misconduct

Tags:

Call us for a FREE 30 minute phone consultation at 416-907-9249 or submit a callback request

Gordon v. Altus: Punitive Damages and Employer Misconduct

In a recent Ontario case $100,000 was added for employer misconduct in punitive damages.

In the employment law sector, the award of punitive damages is often hard to attain given that a terminated employee must substantiate that they have suffered harm at the hands of the employer above and beyond what a typical termination affords.
Reasons for an award of punitive damage may vary, but they typically arise out of conduct which affects the employee’s livelihood.

This is just what occurred in Gordon v. Altus, and what resulted in a $100,000.00 punitive damages award against the Defendant employer.

The Case

The Plaintiff in Gordon was a business owner whom had sold assets of his company to the Defendant. Under a new employment contract, the Plaintiff continued to work for the Defendant company, continuing in a sales role, able to profit somewhat from the success of his company’s sold assets.

Two years following the sale, after the Defendant, with the help of the Plaintiff’s assets had experienced success, and, as the meeting between Plaintiff and Defendant to discuss a possible adjustment to the sale price grew closer, the Defendant began to raise issues with the Plaintiff’s performance and behavior. This behavior was highly peculiar given that it followed a dispute between Defendant and Plaintiff, wherein the Plaintiff rejected the Defendant’s position on the value of his assets, and utilized the arbitration clause in his contract in order to resolve this dispute. Shortly thereafter, the Plaintiff was terminated on allegations of cause, and was left without profit as a result of the assets and without severance or termination pay.

The Plaintiff sued for wrongful dismissal, citing that there was insufficient cause to terminate him, and also noting that the Defendant had a motivation for fabricating cause- specifically, to save money in severance pay and to avoid his continued employment when it was obviously disappointed with regards to the asset price dispute. The arbitration process was still ongoing at this time.

Findings

The court primarily found that there was insufficient cause to terminate the Plaintiff and awarded him reasonable common law notice. It also found, however, that the Defendant’s actions were an obvious attempt to not only save money but to disadvantage the Plaintiff (the Plaintiff’s contract with the Defendant contained a non-competition portion which would effectively limit him from locating comparable re-employment within his sector), and as such, found that substantial punitive damages were warranted as against the Defendant.

Principles

The case of Gordon is demonstrative that callous employer behavior is punishable via the award of damages, even wherein the employer is not a global company (i.e Boucher v. Wal-Mart). Just as an employee is not entitled to reasonable common law notice wherein they have committed willful misconduct, an employer is not entitled to avoid paying severance to an employee (or in this instance, additional sums) by attempting to fabricate just cause wherein none exists to terminate them. Contact Monkhouse Law today for a free consultation if you have been terminated on false allegations of cause, or are concerned regarding your entitlements at law.