Appeal Win: B.C. sales clerk awarded $30K in wrongful dismissal case

Aldergrove Duty Free Shop Ltd. v. MacCallum

Samfiru Tumarkin LLP secured $30,000 in severance pay for our client, Barbara MacCallum, in the case of Aldergrove Duty Free Shop Ltd. v. MacCallum, which was heard at the B.C. Court of Appeal (BCCA).

The BCCA found MacCallum’s employment contract hadn’t been frustrated due to the COVID-19 pandemic and that the Canada Emergency Response Benefit (CERB) shouldn’t be deducted from her severance award for wrongful dismissal.

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Facts of the case

• MacCallum begins working at Aldergrove Duty Free Shop as a retail sales clerk in March 2010. The terms of her employment aren’t specified in writing.
• On March 17, 2020, MacCallum is temporarily laid off due to the COVID-19 pandemic. A day later, the Canada-USA land border is closed to all non-essential travel.
• On March 20, 2020, Aldergrove Duty Free Shop temporarily closes.
• On November, 7, 2021, Aldergrove Duty Free Shop reopens. The company doesn’t recall MacCallum.
• Under B.C.’s Employment Standards Act (ESA), the temporary layoff period for MacCallum expired on or about August 30, 2020. Since she wasn’t recalled, the date of her termination was deemed to be the date that her temporary layoff began.
• Aldergrove Duty Free Shop refuses to provide MacCallum with any severance pay. In response, she files a wrongful dismissal claim.
• Before the B.C. Supreme Court, Aldergrove Duty Free Shop argues that MacCallum’s employment contract had been frustrated due to the COVID-19 pandemic — meaning no severance was owed.
• The trial judge rules that MacCallum was wrongfully dismissed. However, because she received CERB, Aldergrove Duty Free Shop is ordered to pay $16,000 in severance instead of $30,000.
• Confident that MacCallum’s employment contract had been frustrated, Aldergrove Duty Free Shop files an appeal.
• MacCallum cross-appeals the decision to deduct CERB from her severance award for wrongful dismissal.

The Court’s decision

The BCCA dismissed Aldergrove Duty Free Shop’s appeal that the federal government’s decision to close the Canada-USA land border for non-essential travel during the COVID-19 pandemic frustrated MacCallum’s employment contract.

Regarding the cross-appeal, the court agreed that CERB shouldn’t be deducted from her severance award for wrongful dismissal — citing Yates v. Langley Motor Sport Centre Ltd.

As a result, the BCCA ruled that MacCallum was entitled to $30,000 in compensation.

Employment contract wasn’t frustrated

An employment contract can be frustrated when there is an unexpected situation that makes the parties’ obligations under the agreement “radically different” from what was originally accepted, and where neither party is to blame for the situation.

“[Aldergrove Duty Free Shop] paid a wage in exchange for [MacCallum’s] availability and work at the shop,” Justice DeWitt-Van Oosten wrote unanimously for the court.

“Practically, I do not see how the [Canada-USA] border closure [due to the COVID-19 pandemic] radically altered these obligations.”

Having no customers meant financial hardship for the store if it remained open, but the BCCA found that it wasn’t impossible for both parties to perform their obligations under the employment contract.

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No written agreement

The court also noted that the terms of MacCallum’s employment weren’t specified in writing.

Since there was no written agreement, her employment wasn’t dependent on market conditions, the number of customers, the volume of sales, or the store’s profitability.

Lesson for employees

• If your employer refuses to provide you with severance, seek legal advice immediately: Claiming an employment contract has been frustrated is one way that companies try to get out of providing staff with the compensation they are owed. If you are fired for cause or let go without severance for any reason, contact an experienced employment lawyer at Samfiru Tumarkin LLP. We can review your situation, assess you legal options, and help you secure the compensation you deserve.

Lessons for employers

• Written employment contracts can be beneficial: Outlining specific terms and conditions in writing could help employers successfully argue that an unexpected event did change the nature of the parties’ obligations — rather than simply making one side’s obligations more difficult. As a result, a court might agree that an employment contract was frustrated and severance pay isn’t owed.
• Consult an employment lawyer before laying off staff: Employers should always speak with an experienced employment lawyer at Samfiru Tumarkin LLP before laying off non-unionized workers — even if it’s only meant to be temporary. Since each employment matter is unique, a thorough review by our team will ensure that laws aren’t being broken and that the employee’s rights have been taken into account.

Lost your job? Speak with an employment lawyer

If you are fired or let go for any reason, contact the experienced employment law team at Samfiru Tumarkin LLP.

Our lawyers in B.C., Alberta, and Ontario have helped tens of thousands of non-unionized individuals resolve their workplace issues.

We can review your situation, enforce your rights, and ensure that you receive the compensation you are legally entitled to.