Canada: Reason Returns To Reasonable Notice In Ontario

The Ontario Court of Appeal in Dawe v. The Equitable Life Insurance Company of Canada, 2019 ONCA 512 (“Dawe”) confirmed that 24 months constitutes “the high end of the appropriate range of reasonable notice” for employee dismissal, and only “exceptional circumstances” will support a notice period in excess of 24 months. 

At the time of his dismissal, the plaintiff, Mr. Dawe, was 62 years old, employed as a Senior Vice President and had 37 years of service.  The Court of Appeal specifically noted that while Mr. Dawe’s senior position, age and long term career with the employer warranted a substantial notice period, they did not constitute “exceptional circumstances” to go beyond 24 months.  In awarding 30 months, the lower court relied, in part, on the fact that Mr. Dawe intended to continue working for his employer until retirement.  The Court of Appeal rejected this argument and confirmed an earlier Ontario decision that held that an employer does not guarantee employment to retirement. 

In recent years, notice periods in Ontario have frequently exceeded 24 months for long service employees, even in lower level management positions.   This case is important for employers with employees in Ontario because it confirms that: (i) long service and holding a senior position no longer constitutes “exceptional circumstances” to award a notice period beyond 24 months; and (ii) there is no guarantee of employment until retirement.  

This case may also have important implications outside of Ontario where we are seeing notice periods creep beyond 24 months.  For example, in the 2018 BC case of O.W.L. (Orphaned Wildlife) Rehabilitation Society v. Day, 2018 BCSC 1724 (“O.W.L.”), the BC Supreme Court held that 30 years of service in a senior position constituted “exceptional circumstances” to justify a 26 month notice period.  The O.W.L. decision is under appeal (scheduled to be heard in January 2020) and we are hopeful that the reasoning from Dawe will be applied.  We will provide an update once the BC Court of Appeal decision is released in the O.W.L. case.

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