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Fairness – Judicial Discretion

February 19, 2003
by Israel Foulon LLP

When black letter law meets the concept of fairness

Judicial discretion likely to be exercised in favour of employee

The case of Scarlett v. Wolfe Transmission Limited 2002 CarswellOnt 3917 (O.S.C.) yet again highlights the uncertainty faced by human resource professionals and their lawyers.

Delroy Scarlett worked for Wolfe Transmission Ltd. for more than 20 years. His employment was terminated, allegedly for cause, in September 2001.

Two days after being let go he filed a complaint, without legal representation, under the provisions of the Employment Standards Act, 2000, claiming termination and vacation pay. On Oct. 4, having retained legal counsel, he started a civil action for damages for wrongful dismissal, breach of contract, loss of opportunity, mental anguish and for exemplary and punitive damages. A statement of defence was delivered on Nov. 5.

On Nov. 15 Scarlett and the general manager of Wolfe Transmission attended a fact-finding meeting with an employment standards officer. The officer adjourned the meeting in order to get legal advice on her authority to investigate the matter given that a civil proceeding had been started. She advised Scarlett to seek legal advice and to provide her with his written direction to continue with the investigation or withdraw his complaint by Nov. 26.

She was concerned because, since Scarlett had worked for his employer for 20 years, he would likely be entitled to a lengthy period of reasonable notice at common law. Under the termination pay provisions of the ESA, 2000, Scarlett’s maximum entitlement was eight-weeks’ pay in lieu of notice, which is a fraction of what he may be entitled to at common law. Coupled with these facts is that the provisions of the act make it clear an employee can begin proceedings or start a civil action but cannot maintain both actions.

Section 97 of the ESA, 2000, states:

(1) An employee who files a complaint under this act… (re: wages)… may not commence a civil proceeding with respect to the same matter……

(4) Despite ss. (1) and (2), an employee who has filed a complaint may commence a civil proceeding with respect to a matter described in those subsections if he or she withdraws the complaint within two weeks after it is filed.

A companion provision of the act provides that an employee who has started a civil proceeding for wrongful dismissal may not file a complaint claiming termination or severance pay or have such complaint investigated by an employment standards officer.

On Nov. 26, presumably after being notified of the above election provisions and being told he could be entitled to much more significant damages in the civil courts, Scarlett withdrew his complaint under the act. Subsequently Wolfe Transmission brought a motion to stay or dismiss the civil action on the grounds the civil action was barred by virtue of section 97(4) of the ESA, 2000.

One may have thought, since there is nothing in the act providing for an extension of the two-week election period, the legislation would clearly require a claimant to decide within the two weeks as to whether he wishes to proceed with a complaint under the ESA, 2000, or by civil proceeding.

One may therefore conclude there is no discretion in respect of this election and after two weeks the matter must be either an employment standards complaint or a civil action without regard to the particular facts or equities of the specific case. Should this result in an injustice, the remedy would be to change the legislation to allow claimants greater flexibility. But, unfortunately for employers, this is not the case in this era of judicial supremacy.

In fairness to the civil motions judge, he was faced with a very difficult decision. Since the employment standards complaint had been withdrawn, the only available remedy was the civil proceeding. If the civil action was not allowed to proceed by virtue of s. 97 (4), Scarlett would be left with no remedy.

In the judge’s words: “The plaintiff was unrepresented by legal counsel when he commenced his employment standards complaint. Even though he did have counsel for his wrongful-dismissal claim, it would appear he continued to be unrepresented with respect to the employment-standards matter when he attended the aborted meeting of Nov. 15 and when he withdrew the complaint. He subsequently complied with the deadline provided to him by the employment standards officer. He was employed by the corporate defendant for over 20 years. He certainly has an arguable case in support of his action for wrongful dismissal and attendant relief which the defendants primarily defend on the basis of cause. There has been no bad faith on the part of the plaintiff and the defendants have not been misled or taken by surprise in any way. There is no suggestion of any prejudice to the defendants if the relief requested by them is refused and, indeed, I am unable to conceive of any such prejudice. The prejudice to the plaintiff, on the other hand, is significant. To me it would be a gross miscarriage of justice if the plaintiff were deprived of the opportunity to pursue his rights in court.”

The motion judge chose to exercise the court’s inherent jurisdiction to extend a limitation period as, in his opinion, there were special circumstances. There is an old legal maxim that sympathetic facts can make bad law.

In this case the motion judge was clearly sympathetic to Scarlett’s lack of knowledge regarding the requirement to elect between a proceeding under the act or a civil action and was not going to allow it or the black letter law to result in what he considered to be a miscarriage of justice. For employers this is simply another example that illustrates the courts recognize the relatively disadvantaged position of employees compared to their employers. Courts will often take whatever steps they can to ensure employees receive fair treatment, regardless of the strict wording of the law.

Being human beings, judges sometimes put the cart before the horse and allow their desire to achieve what they consider to be a fair and just result to dictate their reasoning even in the face of what would appear to be clear legislative intent.

Peter Israel is the senior partner in the Toronto law firm of Israel Foulon LLP – Employment and Labour Lawyers. He can be reached at 416-640-1550 or pi@qtw38575.mywhc.ca. A version of this article originally appeared in the Carswell publication, Canadian Employment Law Today.


Legal Disclaimer

This article is for informational purposes only and is not intended to provide legal advice, which in all circumstances must be tailored to the specific facts of any problem. You should obtain a proper legal consultation in order to determine how this article applies to your specific situation. Please feel free to contact Israel Foulon LLP to learn more at 416-640-1550.