BC Court Awards Punitive Damages to Employee based on Errors in Employer’s Termination Letter

The fine print matters in termination letters, even in mass layoffs. The wrongful dismissal case of Moffatt v. Prospera Credit Union, 2021 BCSC 2463 is a cautionary tale for employers in British Columbia.   In Moffatt, the Court took the highly unusual step of ordering the employer to pay punitive damages for mistakes in its termination letter.  In doing so, the Court recognized the vulnerability of recently terminated employees:

This is a situation concerning recently terminated employees who are potentially significantly vulnerable, and in distress.  The Defendant’s lack of attention to detail in the termination letter, especially where the errors fall so clearly in their favour, is unacceptable, and draws an award of punitive damages.

The errors in the termination letter included: (1) an offer of two weeks pay pursuant to the Employment Standards Act which was less than the three months the employee was entitled to receive based on her employment contract, and (2) a doubling of the non-solicitation period of the employee’s contract. The Court also noted that the employer instructed the employee to sign a release of claims within one week. 

Punitive damages are rarely awarded in wrongful dismissal cases. The Supreme Court of Canada has stated that “conduct meriting punitive damages awards must be ‘harsh, vindictive, reprehensible and malicious’, as well as ‘extreme in its nature and such that by any reasonable standard it is deserving of full condemnation and punishment.’” Honda Canada Inc. v. Keays, 2008 SCC 39.

In Moffatt, the employer argued that the errors were not intentional, harsh, vindictive, reprehensible or malicious, but were an oversight that occurred while preparing over 100 termination letters as part of a reorganization.  Basically, the argument was that it was just a mistake.  In rejecting this argument, the Court stated:

[T]here is an obligation on an employer terminating an employee in such circumstances to act in good faith and reasonably.  A ‘cookie cutter’ termination letter drafted without regarding to the individual circumstances of each employee falls short of the standard required.

* * *

The volume of termination letters an employer issues does not lessen the obligation to ensure they are correct.  There is no volume discount on correctness for termination letters. 

The employer also argued that it was willing to correct the errors when the employee’s lawyer pointed them out.  The Court  refused to let the employer off the hook:

The Defendant’s argument highlights the crux of the problem.  In this instance, the Plaintiff hired a lawyer.  Had she not, these errors may not have been discovered and corrected.  Given the circumstances of a termination, and its highly emotionally charged nature, it is equally as likely that the plaintiff, or others in her position, could have simply signed the termination letter.

The Court acknowledged the test for punitive damages from Honda but noted that punitive damages may also promote the goals of deterrence and denunciation.  The Court went on to award punitive damages for the “purposes of deterrence and denunciation” in the amount equivalent to two-and-a-half months’ salary which was the amount the employee would have lost if she had signed the termination letter.  While not calculated in the decision, this appears to be around $7,500 in punitive damages.  The punitive damages were in addition to an award of 3 months’ pay in lieu of notice.

Lesson for Employers:  Termination letters should be prepared meticulously with careful reference to the employee’s employment agreement and the requirements of the Employment Standards Act.  Even innocent mistakes can be costly. 

Lessons for Employees:  Do not take an employer’s termination letter at face value.  Refer to your employment contract and the Employment Standards Act before signing a termination letter or release and have your termination package reviewed by an experienced employment lawyer. 


This blog is not intended to serve as legal advice, and only provides general information. Every situation must be considered on its own facts. Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

Workplace investigations under the Canada Labour Code

Federally-regulated employers (which include banks, airlines, transportation and telecommunication companies amongst others) had to adjust to new ways of dealing with harassment, bullying, discrimination and workplace violence allegations as of January 1, 2021, with the enactment of the Workplace Harassment and Violence Prevention Regulations under the Canada Labour Code. 

Federally-regulated employers have always had an obligation to investigate complaints, but there are some new and challenging requirements of the 2021 Regulation. These include:

1. Prescribed timelines.

These timelines are not too tight, but having to keep an eye on them is an adjustment. For instance, acknowledging receipt of the concerns within 7 days, starting the investigation within 45 days, keeping the parties informed of the status of the investigation with monthly updates, and completing the investigation within a year. The kicker is, the one year includes fully implementing any recommendations from an investigator’s report. Depending on how detailed those recommendations are, and the size of the workforce or the amount of people involved, one year may be a tight deadline.

2. Representation.

Non-unionized employers will have to remember to inform the parties that they may be represented through the investigation process, and not panic if the respondent brings legal counsel to the interview.

3. Expertise.

If you are investigating, you must be an expert. HR folks take note. The Regulations require you to be trained in investigative techniques, and that you know the law, both the Canada Labour Code and the Canadian Human Rights Act.

4. Appointment process.

Who gets to investigate is now subject to approval by the policy committee in your organization, or by the health and safety representative (referred to by the Regulation as the “Applicable Partner”). You can develop a list of investigator names and have that list approved by the Applicable Partner, so all your internal investigations people can continue to do their job as they were before. If you don’t create that list, the Regulations give the complainant and the respondent the prerogative of choosing who investigates, though they must agree on a name. From a practical perspective, this last option can be difficult to implement. These are two people who no longer see eye to eye, and it is unlikely they will agree on the issue of appointing an investigator. If the parties can’t agree, the government can provide an investigator from their own list of experts.  

5. Conciliation.

You have to offer the parties an alternative to a formal investigation. The Regulation speaks of resolution via “conciliation”. The term is not defined by the Regulation, though is generally understood to mean a way of resolving a dispute with the assistance of a third party. Some employers are wondering what exactly is expected, and what the costs would be to hire external conciliators or train their own HR on conciliation techniques. When the allegations are related to sexual harassment, it is important to carefully consider how an offer of conciliation will made, what the format of that conciliation would be, and how it could be triggering or re-traumatizing for the complainant.

6. Former employees can bring complaints too.

They have 3 months to do so after the end of their employment. However, employers need to remember that their obligations to investigate concerns do not arise only under the Canada Labour Code. There is the possibility of liability under the Canadian Human Rights Act for not investigating, even if the employee is no longer with the organization, or has left longer than 3 months ago.

7. The content of the investigation report is now prescribed.

The report has to mention the circumstances in the workplace that contributed to the harassment and make recommendations on how to prevent similar occurrences (so investigators have to put their minds to systemic and workplace culture issues). Reports must not reveal the identity of the parties and a copy must be provided to both the complainant and the respondent, as well as to the Applicable Partner. Investigators need to be very cautious in their writing of the report. Sometimes the most careful of redactions can still reveal enough information that any of the recipients could piece together on who did what to whom and when and who testified against them. Describing titles, relationships or departments/locations in the report may reveal the identity of the parties. The employer must keep a copy of the report for a period of 10 years, which is longer than the regular 7-year period for business records, so make sure you make the necessary arrangements to avoid premature destruction.

8. Government reporting.

If you were already keeping solid records of all the concerns brought forward by employees, or your HR management system already provides you with case management and fulsome data in relation to concerns, congratulations. You may be halfway there. In addition to the already existing requirement to submit annual reports on all hazardous occurrences in the workplace, the government is now looking for the following things by March of each year:

  • the total number of occurrences,
  • the number of occurrences that were related to sexual harassment and violence and non-sexual harassment and violence,
  • the number of occurrences that resulted in the death of an employee,
  • if known, the number of occurrences that fell under each prohibited ground of discrimination set out in subsection 3(1) of the Canadian Human Rights Act,
  • the locations where the occurrences took place, specifying the total number of occurrences that took place in each location,
  • the types of professional relationships that existed between the complainant and respondent, specifying the total number for each type,
  • the means by which resolution processes were completed and, for each of those means, the number of occurrences involved, and
  • the average time, expressed in months, that it took to complete the resolution process for an occurrence.
9. Penalties for non-compliance.

HR and management in charge of workplace investigations need to pay close attention to the new requirements in the Regulation and adjust their investigations and related processes accordingly. The government has a non-compliance approach that always starts with a request to voluntarily comply. Continuous non- compliance will lead to monetary penalties and the publication of the employer’s name in certain circumstances.

Catalina Rodriguez has experience as a workplace investigator in the Federal sector.

This blog is not intended to serve as legal advice, and only provides general information. Every situation must be considered on its own facts. Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

Responding to wrongful dismissal claims

Last week, the Globe and Mail reported that “scores of unvaccinated workers are filing wrongful dismissal claims against employers”. I have represented employees and employers at various stages of wrongful dismissals, from settlements to trials, and I have been getting many inquiries from employers asking how they should respond to wrongful dismissal claims. Below are my top 3 frequently asked questions and answers.

Q1: I received a letter from a former employee’s lawyer asking me to pay money. What should I do next?

Check to see when you need to respond by. If you only have a few days left, respond to the lawyer and tell them you are in the process of finding a lawyer and need more time – almost 99% of all lawyers will likely say “yes”. It is always easier, quicker, and cheaper for both parties to settle than to go to Court. By telling the lawyer you are getting legal advice, you are telling them that you are taking this seriously and that you want things to resolve as quickly, easily, and cheaply as possible. However, settlements require both sides to compromise and that’s why you need to speak to a lawyer who will tell you both the strengths and the weaknesses of your case and how much it will take for you to take your ex-employee to court versus settling.

Q2: I fired my employee for just cause because they refused to comply with our vaccination policy. Do I have a case?

We cannot give you a firm “yes” or “no” to this question. The reason why is because the question of whether an employer has just cause for termination is highly fact-dependent. Just cause for termination involves a two-step process where the employer must establish that the employee committed some form of misconduct, and that form of misconduct was serious enough to damage the employment relationship beyond repair.

To date, there has been no court decision anywhere in Canada that has ruled on whether non-compliance of a COVID-19 vaccination policy amounts to just cause for termination. We believe that once these cases start to arrive in court, they will all be decided differently, simply because the just cause test will apply differently across different industries, job positions, and work arrangements.

That being said, while just cause is not easy to prove, it is far from being impossible to prove. With the right set of facts, we believe that there is a good chance an employer can prove just cause for terminating an employee for their refusal to comply with a vaccination policy.

Q3: How should I decide whether to settle or go to trial?

I always tell my employer clients that a “win” in a wrongful dismissal is for their business to find the cheapest and least disruptive way possible to make the wrongful dismissal claim go away. For every employer, what this means will be different. Some things that come into consideration are:

  • How will my other employees whom I fired on similar grounds react if they learn that I settled?
  • How will my existing employees react if they learn that I settled?
  • How much time will I be taking away from making my business profitable if I decide to carry on with this lawsuit?
  • What are my odds of getting a less expensive result in court rather than settling right now?
  • If applicable, will pending lawsuits have any impact on my plans to sell the business?

These are challenging times and it is important for your business to make the right decisions and choices by consulting a lawyer on your next steps.

This blog is not intended to serve as legal advice, and only provides general information.

Every situation must be considered on its own facts. Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

So you have been served with a wrongful dismissal lawsuit, what’s next?

So you have been served with a wrongful dismissal lawsuit, what’s next?

We are regularly contacted by businesses who have been served with a wrongful dismissal lawsuit by a former employee.  This can be very stressful and for many, the first time they have been sued.  Here are answers to some of the most frequently asked questions that we have received from businesses who have been sued by former employees.

  1. Do I need a lawyer?

Probably.  Hiring a lawyer to help you defend a lawsuit is a sensible idea.  Lawyers can help explain your rights and obligations, assist in preparing documents and advise you on court rules and procedures, which can be complicated.

Some employers prefer to defend themselves and there are a number of helpful online resources from the Provincial Court (https://www2.gov.bc.ca/gov/content/justice/courthouse-services/small-claims/how-to-guides) and Supreme Court (https://www.bccourts.ca/supreme_court/self-represented_litigants/)  which you should access.

  1. Is this lawsuit public?

Yes.  Once a Notice of Civil Claim is filed in either the Provincial or Supreme Court it is accessible to the public.  Any documents that are filed with the Court, like a Defendant’s Response or Affidavits are also accessible to the public.  In rare cases, a party can request that documents filed with the Court be “sealed” or labelled confidential which means that they are not accessible by the public.

  1. How much will it cost?

It is always difficult to estimate how much defending a lawsuit will cost.  There are filing fees that are set by the Court.  If you hire a lawyer, then you will also have to pay legal fees for their time in assisting you.  Most lawyers charge an hourly rate and those rates can vary.  How complicated the case is will also have an impact on the overall cost.

Bottom line, litigation can be costly, so make sure to ask your lawyer from the outset about their fees and for them to give you a range of the expected cost.  You should also ask your lawyer for regular updates about their fees at each step of litigation.

  1. When will I have to pay?

Your lawyer should provide you with a retainer agreement or an engagement letter which sets out the terms of the retainer, including when payment is due.  You may be required to provide an initial retainer when you first hire the lawyer.  Most lawyers require you to pay monthly for any time spent working on your file.

For more information about lawyer’s fees and retainers, see the Law Society of B.C.s website:  https://www.lawsociety.bc.ca/working-with-lawyers/lawyers-fees/

You may also end up having to pay your former employee damages, often in the form of more severance pay. Most cases settle before a trial, so payment happens then, or if you may have to pay the employee after a trial and award, which could take 12 months or more.

  1. What happens if I don’t defend it?

If you “do nothing” and decide not to defend the lawsuit, the Plaintiff (the person who sued you) can go to Court and ask for a Default Judgement against you.  If the Plaintiff is successful, then the Court issues an Order stating that the Plaintiff “wins” their lawsuit.  The Plaintiff can then take steps to enforce that Default Judgment against you, which can include garnishing wages, freezing bank accounts or putting liens on property you own.

There are a number of online resources available to help you navigate a lawsuit, including pro bono legal services.  Here is a good summary of some of those resources:  https://www.lawsociety.bc.ca/working-with-lawyers/resources-on-the-justice-system/

Wherever you decide to go, it is important to consult a lawyer to make sure you understand your rights and obligations.


This blog is not intended to serve as legal advice, and only provides general information.

Every situation must be considered on its own facts. Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

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Severance for a Contractor? What, no way!

I hired this person to work in my business. They asked to be a contractor. They wanted the flexibility and the write offs. It didn’t work out and now they want severance. What?! I don’t owe them anything! … do I?  

They hired me as a “contractor” but always treated me like an employee.  Then they let me go with no notice. Can they really do that to me!?

These questions come up all the time and the lawyerly answer to both is “it depends.” Why? Because the law says that even if you have a “contractor agreement” with someone, you can owe them severance. So when is a “contractor” entitled to severance? We have to look beyond the agreement and examine the true nature of the relationship between the company and the “contractor” to answer this. It often boils down to whether the contractor was really running their own business or whether they were really working for the company. Key factors are:

  • Exclusivity – Was the contractor able to work elsewhere? Did they? How dependent were they on the income? The more exclusive and dependent the relationship, the more likely the person is to be entitled to severance.
  • Control – Did the employer control the contractor’s work and hours? The more control the company has over the contractor, the more likely the company owes the contractor severance.
  • Tools and Expenses – Who owned them? Who paid to repair them? Was the contractor reimbursed for expenses? Contractors normally supply their own tools and are not reimbursed for personal expenses –expenses that are not passed through to a client. True independent contractors are not entitled to severance.
  • Profits and losses – If the contractor completed the job quickly, did she get the profit? If it took too long, did she take the loss? If the contractor had little opportunity for profit or loss, they are more likely to be seen to be working for the company and owed severance.
  • Workers – Could the contractor hire its own workers to get the job done? If not, the contractor is more likely to be seen to be working for the company and owed severance.
  • Contract – What does it say? Did it reflect the true reality of the situation? We have even seen “contractor” agreements that refer to the contractor as an “employee” throughout!

Whether you are a company or a contractor, it is important to have a contract that reflects the true intentions and the reality of the situation. If you don’t:

  • as a company you can be surprised with liabilities such as having to pay severance to “contractors” and sanctions for not complying with Employment Standards, tax and other legislation; and
  • as a “contractor” you can be out of work on little or no notice with potential claims that you have to fight about instead of something fair upfront.

Whether you need a contact, or are involved in a claim, a knowledgeable employment lawyer can help.

This blog is not intended to serve as legal advice, and only provides general information. Every situation must be considered on its own facts.

Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

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Recording conversations at work – will it get you in hot water?

We are regularly asked by employee and employer clients about secretly recording conversations (audio or video) at work.  Some common questions we get are:

  • Is it legal to record conversations at work?
  • I think I am going to get fired, should I record the meeting?
  • What can I do with the recording, if someone is lying about what was said in the meeting?

With a smartphone in everyone’s pocket, it can be done with the press of a button, but should you?

Is recording conversations legal?

In Canada, it is not a crime to secretly record conversations as long as you are an open participant in that conversation.  This is different from recording a conversation in which you are not an open participant.  For example, planting your smartphone in an office on record, and then leaving the room and recording conversations between others while you are not there is not legal.  That type of recording is not legal and could have criminal consequences. Don’t do it!

Secretly recording conversations is risky

Assuming we are only talking about recording conversations in which you are openly participating, in the employment context, should you do it? It is risky and here are some of the reasons why:

  • If you are an employee, recording conversations at work could be a violation of your employment confidentiality/privacy obligations, agreements or policies. Depending on the circumstances, you could be disciplined or even fired for making the recording. Even if your employer does not have policies against recordings, making secret recordings could be taken by your employer as a reason to fire you for cause. This is because of the trust that is needed in an employment relationship.
  • If you are an employer, you have obligations under privacy legislation to notify your employees that you will be collecting their personal information and the purpose of doing so before you do so. Making secret recordings could be the basis for claims against you including claims for constructive dismissal, breach of privacy and depending on the circumstances, aggravated or punitive damages.
  • Whether you are an employee or an employer, if you end up in court, you might have to produce the recording, even if it doesn’t help your case.

So, think long and hard before secretly hitting record at work.  If you think you need to make secret recordings, this is a sign that there is a problem.  You should consider whether there are more upfront strategies for dealing with the situation.  If you have already secretly recorded a meeting and are involved in an employment dispute or expect to be, an employment lawyer can help you decide whether and how the recording can be used.

This blog is not intended to serve as legal advice, and only provides general information. Every situation must be considered on its own facts.

Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

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Sick and fired? The duty to accommodate explained.

At Forte Law, one of the most common work problems that brings clients to see us is disability in the workplace.  We meet with employer clients who are struggling with how to manage employee medical issues that are impacting the workplace.  We  also meet with employee clients who have been fired from their jobs after getting sick.  Sometimes an employee has been fired during, or following a medical leave or when they request changes to their duties or schedule to accommodate medical limitations. Every week, we work with several clients who are facing this stressful situation.

The good news is that the law is clear.  Employers in British Columbia have a duty to accommodate employees’ physical or mental disabilities.  This means that if an employee has a disabling condition, the employer must consider what can be done to maintain the employment relationship before firing them.  In most employment relationships, the duty to accommodate could include allowing employees to take leaves from work for treatment and recovery, or considering modifications to duties or work schedules.

There are limits to what lengths employers must go to in accommodation.  If an employer can demonstrate that the changes required would be undue hardship for its business, for reasons that can include financial costs, or other business impacts then it has reached the end of the duty to accommodate.  Employers are not required to hold positions open forever when an employee is on leave, but decisions to terminate must be based on a careful assessment.

The duty to accommodate is a two way street.  Employees are also required to participate in the accommodation process.  Employees must provide medical information, maintain contact while away from the workplace, and be open and flexible about ideas on how their medical limitations could be accommodated at work.

The bottom line is, if you have been fired or “laid off” in any part because of a medical leave or limitations on your ability to work, you should seek advice from an employment lawyer.  This is a stressful time, and we can help you find a path forward.  We will make sure you understand your rights, and in most cases we are able to help our clients negotiate a settlement that lets them move on with their lives.

Similarly, if you are an employer, and thinking about letting someone go while they are on a medical leave, you should definitely seek guidance from an employment lawyer.  We can ensure that you understand your obligations and risks, so that you can move forward in a manner consistent with the Human Rights Code.

This blog is not intended to serve as legal advice, and only provides general information. Every situation must be considered on its own facts.

Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

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Fired, now what

Wrongful Dismissal 101

Without a doubt, the most frequent questions that I get from employee clients are about their rights once they have received a termination letter. I have reviewed many, many severance packages for employees. I also work for employers to prepare termination letters and severance offers. This blog post contains some of the questions frequently asked by employees and my answers.

Q: I didn't do anything wrong, can my employer fire me?

Yes, employers can terminate your employment "without cause." Even if you are a stellar employee, an employer can still decide to fire you. There are exceptions to this, for example, if you are being fired because you are pregnant or another reason that engages human rights protections. When terminating "without cause" employers have to provide reasonable notice of termination, or pay in lieu of notice (a severance package).

Q: Is termination pay as required by the Employment Standards Act enough?

Not unless there is a (valid and legally enforceable) written contract between you and your employer that says they can terminate on providing only the notice set out in the Employment Standards Act, and no more. The Employment Standards Act establishes minimum standards, including for termination pay. Much more severance pay is often owed.

Q: Is my employer required to give me a reference letter?

There is no legal requirement for employers to provide a reference letter. This is something that can often be negotiated as part of a severance package. Even if there is no negotiation over severance, it never hurts to ask for a reference letter. Consider asking the manager or supervisor you worked with most closely. They are more likely to provide a reference letter than HR, and the reference will be more useful because they know your work.

Q: How much will it cost to get my severance package reviewed?

In many cases, I can review, assess and give solid advice about a severance package offer in an initial consultation for a flat fee. After consulting with me, you will either have peace of mind, knowing that the package is fair and reasonable, or you will know exactly why and by how much the package is short, and have a plan to negotiate improvement.


This blog is not intended to serve as legal advice, and only provides general information. Every situation must be considered on its own facts.

Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

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Layoffs, Restructuring, Terminations, Oh My

When is Employment Terminated?

I answer many questions from employee and employer clients about what happens to the employment relationship when someone has been laid off, or let go due to a restructuring or shortage of work. This is never a happy time for businesses or workers. Employees want to know, have I been fired if the letter says it is a lay off? Employers ask, do we need to provide notice or severance pay if we are in financial hardship? The answer to both questions is in most cases, yes. This blog post applies only to non-unionized employees in British Columbia.

The letter says laid off. Have I been fired?

The answer to this question, in most cases, is yes. The essence of a job is that the employer provides work to be done and pay, and the employee does the work. In a lay off, the employer is no longer providing work to be done or pay, so in most cases, employment has ended.

Employers can lay off an employee, without effectively terminating employment, if:

  1. the employment contract expressly allows for temporary layoffs;
  2. layoffs are a well-known and longstanding industry-wide practice (for example, logging where work cannot be performed during a "break up"); or
  3. the employee agrees to the lay off.

Even if one of these conditions apply, the layoff must be short-term and temporary. In the non-union context, Section 1 of the BC Employment Standards Act limits the length of temporary lay offs of a maximum of 13 weeks in any period of 20 weeks.

If you don't fit into one of these conditions, a lay off of any length is the same as a termination of employment.

We are laying off an employee because we need to downsize to stay afloat, do we still have to give notice or severance pay?

The answer to this, in most cases, is yes. Unless you fit into one of the three categories above, a lay off is the same as termination of employment "without cause." This means that reasonable notice of termination, or pay in lieu of that notice (aka severance pay), must be provided. Unless there is a bankruptcy or similar legal process underway, the financial situation of the employer does not impact the requirement to provide notice or pay severance.

This blog is not intended to serve as legal advice, and only provides general information. Every situation must be considered on its own facts.

Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].

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