Reasonable Notice Roundup for 2016

Written by Michael J Weiler

The most common question from clients with respect to terminations without cause and without notice in the absence of an enforceable agreement is “How Much Notice?”  Courts will look at four key elements to determine how much is reasonable notice:  age, length of service, position and the availability of similar employment having regard to the employee’s skills and qualifications.  The court will often look at economic circumstances but will not give that factor undue weight.

Contrary to popular belief there is no legal rule of thumb of “one month for each year of service”. The highest period of notice, subject to a few exceptions, is 24 months.  Please bear in mind the fact that each case will be decided on its own facts and there is no litmus test. Further the amount of notice will not always define the amount of damages as the employee must mitigate her damages and must also prove her loss (e.g. lost benefits or bonuses).  On the other hand, the employee may be awarded additional punitive, exemplary or aggravated damages.

The following cases from this past year will give you some idea of the courts’ present thinking on the matter. A bit of good news for employers is found in Cabott v Urban Systems Ltd where the Court of Appeal reduced the amount of notice by 1/3 given the short period of service. These can be very important factors in each case especially dealing with senior executives whose compensation can often exceed $20,000 per month.