Small Claims Court Judge’s Wrongful Dismissal Error Results in Redo

When the monetary limit of the Ontario Small Claims Court was raised from $10,000 to $25,000 on January 1, 2010, small claims became a big deal to most Ontario employment lawyers. $25,000 is not an insignificant amount of money, and a lot of wrongful dismissal cases can be reasonably worth between $20,000 - $30,000. Given the costs of a Superior Court action, both in terms of actual dollars and time, litigating a case in the Small Claims Court and waiving one’s entitlement to damages in excess of $25,000 can make a lot of sense.

It is for those reasons that it is important that our Small Claims Court Deputy Judges, and those appearing before them, have a solid understanding of employment law issues. One of the most fundamental of issues is when an employer will have just cause to terminate an employee without the provision of notice or payment in lieu thereof.

In a decision from the Ontario Divisional Court, Majewski v. Complex Services Inc., 2013 ONSC 690 (CanLII), the Honourable Mr. Justice Ramsay held that a Small Claims Court Deputy Judge had erred in his approach to the central issue of the case, which was whether the employer had just cause for dismissal or not. In the result, Justice Ramsay ordered a new trial on the issue of liability.

Facts

The case concerned a card dealer at a Niagara Falls casino. The facts as found by the learned trial judge were that:

The incident that led to his termination took place on August 25, 2005. The plaintiff had a headache, so he wanted to go home early. Management sends dealers home early when business is slow. By signing the “early out” list, staff signify that they want to be chosen to go home. The plaintiff testified that he saw Richard Maracle, a co-worker, who had the early out list in his hand, in the middle of the hallway that leads to the scheduling office. The plaintiff took the list and Richard took it back, saying “go look over there, it’s hanging over there.” Richard also mumbled something that the plaintiff could not make out. The plaintiff told him that he did not have to be such a “fucking prick.” He also called him a “fucking asshole.” Richard reported the incident to the shift manager.

The question that the Small Claims Court judge was asked to resolve was, did the employer have just cause to terminate the employee without providing him with notice?

Decision

In finding that the Small Claims Court judge had erred in his decision, Justice Ramsay noted that:

In wrongful dismissal actions, a court is required to analyze whether dismissal is proportionate to the nature and seriousness of the misconduct in the context of the employment relationship: McKinley v. BCTel., [2001] SCR 161. The judge did not articulate this test. The appellant says that the judge failed to conduct any analysis along the required lines. The judge is not obliged to refer to the test explicitly, but looking at his reasons as a whole, with particular attention to the evidence that he considered important and his analysis of it, I conclude that he did not apply the correct test. (Para. 11)

Commentary

I mention this decision primarily because of its relevance to many wondering about wrongful dismissal and just cause. For better or worse, a greater number of wrongful dismissal cases in Ontario are now being tried in the Small Claims Court and not all Deputy Judges are familiar with employment law issues.

While the Small Claims Court is often referred to as a court of equity, where the rules of evidence are relaxed and the strictures of the law not always followed to the absolute letter, cases such as this one do demonstrate that a certain, basic level of law will be followed.

It is therefore important for anyone considering a case of wrongful dismissal to have a basic understanding of the approach in cases such as McKinley, Bardal, and to some degree Red Deer College and Evans.

If you are considering a wrongful dismissal case, and don’t feel comfortable with arguing the law, it may be appropriate to seek the assistance of professional, experienced employment lawyers. The employment lawyers at Kelly Santini LLP would be happy to be of service to you whether you’re an employee or employer, and whether you’re considering a case worth $25,000 or considerably more. Because, as this case shows, as little as most people want to have one trial, if the case is done incorrectly, sometimes you may have to do it twice!

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As always, everyone’s situation is different.  The above is not intended to be legal advice for any particular situation and it is always prudent to seek professional legal advice before taking any decisions on one’s own case.

Sean P. Bawden is an Ottawa, Ontario employment lawyer and wrongful dismissal lawyer practicing with Kelly Santini LLP, and part-time professor at Algonquin College teaching Trial Advocacy for Paralegals, focusing on Small Claims Court trials.