Anatomy of a Failed Termination Process        2012 Vancouver Employment & Labour Law Conference            Allen Soltan a...
Review of Vernon v. British Columbia (Liquor DistributionBranch), 2012 BC Supreme Court [http://www.courts.gov.bc.ca/jdb-t...
Complaint against Vernon•   A unionized employee complained Vernon made her feel    “harassed, embarrassed, humiliated and...
Investigation of Complaint•   Investigator “should not have been put in charge of the    investigation”: she was also Vern...
•   Vernon had no opportunity to respond to many of the allegations.•   Vernon was not ever told her job might be in jeopa...
“[230] What the Recommendation Memo did not disclose was that Ms. Vernon    had been given no opportunity to respond to th...
[255] The interview of Ms. Vernon was contrary to its intended purpose and    unfair in the extreme. Ms. Vernon thought sh...
[260] Ms. van der Boom’s mistaken report had serious consequences.    Thereafter, all persons at the LDB involved in the i...
[274] Mr. Ferrara and Mr. Branham never appear to have considered the    actual complaints in the March 1 Letter. Outside ...
The Termination Meeting•   Vernon was told she had engaged in “gross workplace    misconduct”, including bullying, harassi...
“[275] The meeting of April 19 was badly handled. Telling Ms. Vernon, after a    30-year exemplary career, that her action...
•   The Court found no cause for dismissal:     “While some of her conduct may have been inappropriate, she was    at all ...
Result: A very expensive dismissal, bad public relations,and damage to the individual reputations of the managersinvolved....
•   Aggravated damages    • “The foundation of the claim for aggravated damages is the       manner of dismissal”.    • $3...
Implications•   Everyone is responsible for what they say and do – every    employee of the LDB involved in Vernon’s dismi...
APPENDIX – Damages Primer•   General damages: compensate breach of contract (failure to give    reasonable notice or pay i...
Damages Primer – con’t•   Aggravated damages: compensatory in nature; implied    contractual term that employers will act ...
Damages Primer – con’t•   Punitive damages: not compensatory; are directed towards    punishment; are rare and exceptional...
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Anatomy of a Failed Termination Process

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Anatomy of a Failed Termination Process

  1. 1. Anatomy of a Failed Termination Process 2012 Vancouver Employment & Labour Law Conference Allen Soltan and Justina Driedger (Summer Articled Student)
  2. 2. Review of Vernon v. British Columbia (Liquor DistributionBranch), 2012 BC Supreme Court [http://www.courts.gov.bc.ca/jdb-txt/SC/12/01/2012BCSC0133.htm]Overview• Vernon had worked for LDB for 30 years and was in a responsible management position when dismissed.• Known as “The Little General” for no nonsense management style and insistence “that employees not slack off”.• Vernon had received highly complimentary performance reviews and no complaints had ever been made to her or to LDB.• Employee under Vernon’s supervision complained about her.• Complaint was investigated by LDB, and Vernon was subsequently suspended without pay or benefits, and eventually dismissed without severance.
  3. 3. Complaint against Vernon• A unionized employee complained Vernon made her feel “harassed, embarrassed, humiliated and uncomfortable at work”.• Allegations: • Vernon’s use of profane language “on a daily basis” • “If you don’t tuck in your uniform I’ll kill you” • Insults directed at complainant’s religion• Union was asked for input on how complaint should be resolved; it proposed a remedy which did not include termination of Vernon’s employment.
  4. 4. Investigation of Complaint• Investigator “should not have been put in charge of the investigation”: she was also Vernon’s labour relations advisor and Vernon had, only a few days before complaint received, confided in her about problems she was having with complainant.• The investigator was biased – she created a list of employees to interview, many of whom she knew would have negative things to say about Vernon.• Interviews turned into interrogations, and defensiveness was interpreted as lack of credibility.
  5. 5. • Vernon had no opportunity to respond to many of the allegations.• Vernon was not ever told her job might be in jeopardy.• Some specific complaints were not even looked into.• Interview notes were inaccurate and inconsistent with final recommendation.• Investigator’s recommendations to her superiors were inaccurate and misleading. • e.g., stated Vernon was denying all allegations when in fact she admitted to some.• Court was highly critical of the process:
  6. 6. “[230] What the Recommendation Memo did not disclose was that Ms. Vernon had been given no opportunity to respond to the matters raised in the interviews, that she had agreed to stop swearing, was prepared to apologize for her use of profanity and that the Complainant and the Union were not seeking her dismissal. The Recommendation Memo made no mention of her exemplary work reviews or the fact that in her 30 years of employment there had never been a complaint made against her.[231] Ms. van der Boom agreed at the conclusion of her cross-examination that in the Recommendation Memo, instead of reporting objectively the findings of the investigation, she was trying to prove that Ms. Vernon was guilty of misconduct and should be terminated.
  7. 7. [255] The interview of Ms. Vernon was contrary to its intended purpose and unfair in the extreme. Ms. Vernon thought she was meeting with her labour relations advisor and area manager to discuss in an informal setting a complaint that had been made against her. Instead, she was the subject of an intense interrogation. The person who she had relied on as her labour relations advisor was now her interrogator. Ms. Vernon was upset at the meeting. She had good reason to be.[256] {Ms. Vernon} was given a copy of the March 1 Letter, which contained eight separate complaints, and asked for her immediate response. When she denied certain allegations, she was met with the classic question, “Why would the complainant lie?” It is of course a question that is impossible to answer.
  8. 8. [260] Ms. van der Boom’s mistaken report had serious consequences. Thereafter, all persons at the LDB involved in the investigation proceeded on the basis that Ms. Vernon was denying all the allegations, when in fact that was not so. …[271] Ms. Vernon was a 30-year employee. She had been a store manager for almost 12 years. In all those years there had never been a single complaint made against her. Her performance reviews were glowing. … The lack of any prior complaints against Ms. Vernon should have given them cause to stop and reflect.
  9. 9. [274] Mr. Ferrara and Mr. Branham never appear to have considered the actual complaints in the March 1 Letter. Outside of Ms. Vernon’s swearing which was acknowledged, the balance of the complaints concerned Ms. Vernon’s management style and her harsh corrections of the Complainant on various occasions for alleged misdeeds. When they decided to terminate Ms. Vernon, most of the specific complaints remained unproven.[277] Ms. van der Boom testified that the Recommendation Memo was supposed to be a balanced recommendation to the General Manager. It was anything but.
  10. 10. The Termination Meeting• Vernon was told she had engaged in “gross workplace misconduct”, including bullying, harassing and intimidating behaviour, and that her actions were “embarrassing and shameful”.• LDB did not follow its own progressive disciplinary policy (warning, re-training, a reprimand or transfer were not considered).• LDB proposed a reference letter in exchange for Vernon’s resignation.• Vernon refused to resign and was suspended without pay.• Recommendation to terminate Vernon was not prepared until one month after her suspension.• When her dismissal was finally approved, she was not notified for another 10 days.
  11. 11. “[275] The meeting of April 19 was badly handled. Telling Ms. Vernon, after a 30-year exemplary career, that her actions are embarrassing and shameful could not have been more insensitive. Ms. Vernon had given her entire working life to the LDB and to treat her in such a manner was egregious, shocking and unnecessary.[276] Equally egregious was the LDB leaving Ms. Vernon in limbo from April 19 to May 31. Having rushed to terminate her employment, the LDB did not take any steps to further the process between the meeting of April 19 and the preparation of the Recommendation Memo on May 18. During that time it was common knowledge throughout the LDB that Ms. Vernon had been suspended. Mr. Chambers approved the dismissal on May 21, but Ms. Vernon was not advised for a further 10 days … .”
  12. 12. • The Court found no cause for dismissal: “While some of her conduct may have been inappropriate, she was at all times trying to improve the performance of her employees. At worst, some of her actions amounted to poor performance of the management responsibilities she was attempting to fulfill.” (para 353) “Ms. Vernon was a senior employee with an untarnished record. She was entitled to a warning that her conduct was not acceptable.” (para 354)
  13. 13. Result: A very expensive dismissal, bad public relations,and damage to the individual reputations of the managersinvolved.• General damages • $97,173.18 in lieu of 18 months’ notice (maximum notice permissible under BC public sector employment legislation) – plus – • Pension contributions as if employed for 18 months.• Special damages • To replace MSP coverage, and to compensate for out-of-pocket medical expenses, a job workshop and private counselling.
  14. 14. • Aggravated damages • “The foundation of the claim for aggravated damages is the manner of dismissal”. • $35,000 awarded for an “unfair and unduly insensitive” termination that “was devastating and caused her serious harm”.• Punitive damages • $50,000 for offering a reference letter “as a carrot to resign”. • Tactic was seen as an attempt to take advantage of her vulnerability and avoid a lawsuit for wrongful termination.• Costs Awarded to Plaintiff• Total Damages Awarded – Approximately $200,000
  15. 15. Implications• Everyone is responsible for what they say and do – every employee of the LDB involved in Vernon’s dismissal was the subject of strong criticism by the Court.• “Resign or be fired” may not be a good strategy, except where very high probability of proving cause.• Aggravated and punitive damages are always possible in employment cases.• Providing compensation in lieu of notice in this case would have been significantly less costly than trying to prove cause (always ask if this is a “fight to be won or a problem to be solved?”).
  16. 16. APPENDIX – Damages Primer• General damages: compensate breach of contract (failure to give reasonable notice or pay in lieu of notice) • “reasonable notice” depends on various factors • 18-24 months is usually upper limit• Special damages: compensate for various expenses caused by breach of contract (i.e. out-of-pocket medical expenses, job workshops, private counselling, cost of replacing employment benefits)
  17. 17. Damages Primer – con’t• Aggravated damages: compensatory in nature; implied contractual term that employers will act in good faith in manner of dismissal. • Employee must show manner of dismissal caused mental distress (over and above the normal distress and hurt feelings resulting from dismissal itself) that was reasonably foreseeable. • Bad Faith: being unfair, untruthful, misleading or unduly insensitive.
  18. 18. Damages Primer – con’t• Punitive damages: not compensatory; are directed towards punishment; are rare and exceptional. • Objectives are retribution, deterrence and denunciation. • “Restricted to advertent wrongful acts that are so malicious and outrageous that they are deserving of punishment on their own.”

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