Browse Options
The Cost of Dismissing Older Employees

The workplace is abuzz with the legal implications of the aging Canadian population. At our firm, we are often called upon to assist our clients, both employees and employers, in coping with these issues. We often assist with, among other things, accommodation requests and age discrimination claims. Two recent cases in Ontario have added to the jurisprudence regarding the aging workforce.

The first case involves Paul and Shirley Filiatrault, who, in 1967, founded Tri-County, a Kitchener area welding supplies business. In 1996, the Filiatraults entered into an agreement to sell the shares of Tri-County to Air Liquide. As part of the sale, Paul and Shirley’s sons were to keep their jobs as executives for at least three years; however, Paul (the CEO) and Shirley (the President of Human Resources), did not negotiate the same assurances for themselves.

Four days after the sale was completed in 2009, Paul and Shirley, both in their 80s at the time, were fired without notice. In considering the Filiatraults’ wrongful dismissal claim, Justice Beth Allen found that the sale did not require Paul and Shirley to resign or retire. Justice Allen determined that they were entitled to large damage awards as a result of their dismissals and in light of their 42 years of service, Paul and Shirley were each awarded wrongful dismissal damages based on 18 months’ compensation. It should be noted that Paul and Shirley had capped their loss to 18 months, or else the damage award may well have been higher.

The second recent case involves Niranjan Kotecha, a 70-year-old machine operator who was dismissed by his employer after 20 years of service and was provided with a severance of only approximately 2 months. Niranjan then applied to over 200 companies for work, without success, before suing his former employer seeking 22 months of pay in lieu of notice. At trial, the court awarded Niranjan his 22 months’ severance, after finding that re-employment had and would prove to be difficult for Niranjan in the future.

These recent cases clearly illustrate that long service employees over age 65 who are fired without cause can expect to receive large damage awards – i.e. in recognition of the specific difficulties that such employees will likely face in securing future employment.

With the elimination of mandatory retirement, and the aging baby boomer generation, employers will more and more frequently be faced with the need to dismiss older employees, whether on a just cause or without cause basis.

In such circumstances, employers must be mindful that their decision to terminate an older employee is not related to, and does not appear to be related to, the age of the employee, or of course to any other ground protected by the Ontario Human Rights Code. Otherwise, not only will their decision to terminate an older employee run afoul of the human rights regime, it will result in damage awards in excess of the notice period set out in their contact or the common law. With the aging Canadian population, employers should take dismissal decisions very seriously, and ideally seek counsel before taking this potentially costly step.

Parisa Nikfarjam

Print Friendly

About Parisa Nikfarjam

Parisa Nikfarjam is an employment lawyer at Rubin Thomlinson LLP. Parisa assists employee and employer clients in all matters relating to the workplace such as hiring; terminations; workplace harassment and violence; workplace human rights; and accommodation matters. Parisa also writes numerous articles on employment law issues for a variety of publications and speaks regularly on employment law issues at conferences and workshops. She was called to the Bar in 2012. View all posts by Parisa Nikfarjam →

Leave a Response

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>