Howard Levitt: Recent rulings mean terminated employees may not need proof of distress for damages claims
Our employer clients often express frustration at the state of employment law. When it comes to terminating employees, the courts and legislators force employers to jump through hoops to avoid costly lawsuits. The recent decision by the Ontario Court of Appeal in only adds to the frustration of Ontario employers as the Court upheld a $50,000 aggravated (i.e., mental distress) award without a shred of expert medical or psychological evidence.
On the flip side, we often see employee clients who want to seek damages for the mental distress they experienced during and after termination. We typically advise that, while we understand losing your job is difficult and stressful, there are only limited circumstances where courts will compensate for the way an employee was fired and its mental and emotional impact.
However, this recent decision from the Court of Appeal seems to lower the threshold for aggravated/mental distress damages and should serve as a warning to employers to be particularly mindful of the manner in which they terminate. If they’re not careful, they could be on the hook for aggravated damages for mental distress even if employees do not have medical or psychological proof of the distress they suffered.
Until now, the courts would only award aggravated damages in instances where an employer’s actions during and following termination were particularly unfair or in bad faith and the employee had medical evidence to show that these actions resulted in mental distress. For example, in the case of Wal-Mart Inc. was ordered to pay $200,000 in aggravated damages, among other things, after firing an employee, Meredith Boucher, who was regularly abused and humiliated by her supervisor in front of colleagues and
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