Trial Win: Construction worker awarded severance despite termination clause

Snider v. Reotech Construction Ltd.

Samfiru Tumarkin LLP successfully obtained four-and-a-half months of severance pay for his client, Dean Snider, after a two-day trial in BC provincial court.

Mr. Snider was 41 years of age (40 at the time of his termination) and employed as a construction labourer. At the beginning of the COVID-19 pandemic, Mr. Snider was placed on a temporary layoff by his employer, Reotech. He was later informed that the company did not expect to be able to call him back to work, and he was subsequently never recalled. Prior to his termination, he had been employed by Reotech for over two years.

Overview of the Case

Mr. Snider was initially hired by Reotech after an initial interview and started work shortly after. Several days after the interview, he was presented with an employment manual that contained a termination clause stating that he would only be entitled to up to 8 weeks’ severance pay upon termination. At trial, the court decided that the manual was unenforceable and that the claimant was entitled to reasonable notice (severance pay).

At trial, the employer argued that:

1. His position as a labourer was low-level and he should therefore be owed 2 weeks’ notice or less;
2. Construction industry employees, especially lower-level employees, are entitled to little or notice of termination or severance pay;
3. Any amounts received by the claimant in the form of CERB benefits should be deducted from any award; and
4. The manual was binding on the claimant even though it was signed several days after his first day of work.

Court’s Findings

At trial, the court decided that:

1. The manual was not binding on Mr. Snider since no fresh consideration was given;
2. Mr. Snider was entitled to reasonable notice;
3. As a short-service employee, Mr. Snider would be entitled to 4 months’ pay;
4. Being a construction labourer should not necessarily reduce the claimant’s entitlement to reasonable notice;
5. Due to the COVID-19 pandemic, the notice period would be extended by 2 weeks to 4.5 months’ pay; and
6. CERB benefits are not deductible.

The court also awarded a $1,500 penalty as a consequence for the defendant not accepting a reasonable settlement offer.

Key Takeaways for Employees

Your employment contract may not be enforceable

Employees, regardless of the role being “high level” or “low level” are entitled to severance pay when terminated without cause in the absence of an enforceable employment contract.

Seek legal advice

Employees should seek legal advice from an employment lawyer at Samfiru Tumarkin LLP when presented with a contract of employment or when they are terminated.

Key Takeaways for Employers

Employees may still be owed full severance

Being exempt from the minimum notice requirements under the Employment Standards Act does not necessarily mean that an employee is not entitled to full severance under common law.

Consider settling before trial

Litigants should consider reasonable settlement offers, or risk consequences if they lose at trial.