Alberta Court Affirms Crucial Role Of Clarity In Employer Policies, Employee Resignation

In the case of Stonham v. Recycling Worx Inc. [2023] A.J. No. 1149, the Court of King’s Bench of Alberta reiterated the significance of clear and equivocal language in both employer policies and employee resignation.

Background

The plaintiff was employed as a commercial truck driver for the defendant when he experienced a workplace injury in October 2019, falling off a truck. After a period of recovery, the plaintiff returned to work, taking on modified duties and later going on medical leave.

By August 2020, the plaintiff was expected to resume full-time pre accident duties by Sept. 15, 2020, and he requested the defendant’s permission to start driving trucks again. The defendant rejected this request, and in September 2020, neither party confirmed the plaintiff’s readiness to return. Absent from work on Sept. 15-17, 2020, the plaintiff, on Sept. 18, 2020, sought to be reinstated as a Class 1 driver. Citing company policy, the defendant claimed the plaintiff had resigned due to a three-day absence without notice, leading the plaintiff to file a wrongful dismissal claim against the defendant.

Issues

The primary issues in this case revolved around whether the plaintiff voluntarily resigned or abandoned employment, or if he was wrongfully terminated.

Was the resignation clause binding on the plaintiff?

In this examination, the court initially assessed whether the defendant’s resignation clause in the employee handbook was binding on the plaintiff. The plaintiff received the handbook after commencing employment, and he specifically signed the page with the resignation clause (clause). While the plaintiff was aware and assented to the handbook and the clause, the court determined that the clause was not binding on the plaintiff for two reasons.

First, the clause was deemed ambiguous. It stated that employees are “considered to have resigned from the company if they are absent for more than three consecutive working days without contacting the office.” This wording raised several questions. For instance, whether the defendant would have “considered” the employee to have resigned, or whether the employee is “deemed” to have resigned. Additionally, it remained unclear whether the employment was immediately terminated or if it provided an option for the defendant to terminate based on the resignation.

Second, the clause purported to fundamentally alter the plaintiff’s common law rights. Under common law, resignation is required to be “clear and unequivocal” and voluntary based on the employee’s free will. A resignation clause that either deems someone to have resigned or grants the employer the right to consider someone as having resigned, even if the employee may not have intended to do so, fundamentally changes the employment relationship, stripping the employee of their common law rights. For these reasons, the resignation clause was not binding on the plaintiff.

Additionally, the court considered the subjective and objective test for assessing employee resignation. In determining a resignation, one must answer subjectively, did the employee intend to resign, and objectively, viewing all the circumstances, would a reasonable employer have understood that an employee had resigned. Even if the resignation clause were binding on the plaintiff, the court found that, on a balance of probabilities, the subjective element of the resignation was not met because the plaintiff expressed a desire to return to work as a Class 1 driver. Furthermore, based on the same resignation analysis, the court also concluded that the plaintiff did not abandon his job.

Was the plaintiff wrongfully dismissed?

Considering the plaintiff did not resign or abandon his job, the court determined that the plaintiff was wrongfully dismissed. Considering the Bardal factors, which included the plaintiff’s age and his three year tenure, the court deemed a 2.5-month notice period as reasonable. As a result, the plaintiff was awarded damages in the amount of $11,250.

Conclusion

This case serves as a reminder of the importance of clear and precise employment policies and highlights the court’s dedication to preserving employees’ common law rights when confronted with ambiguous contractual provisions.

This article was written by Dharshani Arumugam, Employment Lawyer at Monkhouse Law and was originally published in Law360 Canada on February 5, 2024. Monkhouse Law is an employment law firm located in Toronto focusing on employee issues. Give us a call at 416-907-9249 or fill out this quick form. We offer a free 30-minute phone consultation.

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