Failure to Provide References a Critical Mistake For Employers

Typically, an employee who has been terminated or laid off has not left the employment relationship on the best of terms. While an employer may be reluctant to provide a glowing reference or assist the employee in obtaining re-employment, this can be a costly mistake.

The courts have also recently addressed the requirement of employers to provide terminated or laid off employees with their statutory entitlements, such as a Record of Employment. While an employer is no longer required to mail a copy to terminated or laid off employees, they are required to submit a copy of the Record of Employment online with Service Canada.

Given the economic climate and the availability of comparable positions, references and Records of Employment are more integral than ever to an unemployed individual’s mitigation efforts.

Case Law

In the case of Gillman v. Saan Stores Ltd. [1992] A.J. No. 1028, the Plaintiff, a retail Sales Manager, was terminated after 32 years with the Defendant’s company. The Plaintiff had breached company policy in signing off on an absence report so that a subordinate could babysit for him, which upper management caught wind of as a result of an employee notification. After he was terminated, the Plaintiff diligently mitigated his damages, applying to numerous positions that were comparable. This task, given his termination and time at the company, was difficult enough, but the difficulty increased when his former employer provided an unfavourable reference without his knowledge. At trial, the Plaintiff was awarded six months’ pay in lieu of notice- an additional 2 months from the usual notice period for an individual in similar circumstances, reimbursement for his career counselling services, and $5,000.00 in punitive damages for his employer’s conduct in alleging just cause against him and refusing to provide a favourable reference to assist the Plaintiff in obtaining re-employment.

Related Cases

In the 2013 case of Nelson v. 977372 Ontario Inc. (c.o.b. Insta Insulation) [2013] O.J. No. 3182, the Defendant also made a critical post-termination mistake. Aside from the Defendant’s poor conduct in that its proprietor terminated the Plaintiff by telling him to “get the f*** off the property”, the Defendant did not and refused to issue the Plaintiff a Record of Employment, a statutory requirement and an integral component of gaining employment insurance and other benefits. At trial, $3,000.00 in punitive damages were awarded against the Defendant for a failure to issue the Record of Employment and to provide the Plaintiff with other statutory entitlements.

Advice for Employers

Regardless of how an employee’s departure from the company occurs, it is crucial that you as an employer take all steps necessary to assist in their mitigation efforts. Not providing positive references is a decision that can actually backfire as a judge may find that you added to a terminated employee’s difficulty in mitigating. Moreover, it is important that you provide all statutory entitlements to a terminated or laid off employee upon their departure from your company. This minimizes any liability on your part involving their employment insurance claims or any other post-employment steps which may be hindered by a failure to provide such entitlements. Contact Monkhouse Law today for a free consultation.

Advice for Employees

If you have been terminated or laid off and your employer has failed to provide a positive reference, or statutory entitlements such as your Record of Employment or vacation pay accrued, contact an Employment Lawyer. You may have a legal claim for damages arising out of your employer’s failure to provide such items, as the cases mentioned above establish.

It is also important to contact an Employment Lawyer if you have been terminated and offered a severance package that does not include items such as a continued benefit package throughout a reasonable notice period. Contact Monkhouse Law today for a free consultation.

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