Employers are well aware that an employee has an obligation to mitigate their damages following a termination. This means that, after a dismissal, an employee has a duty to act reasonably in seeking comparable employment. If litigation ensues in a wrongful dismissal action, the onus is on the employer to prove that the employee failed to take reasonable steps to search for comparable employment and that employment would have been secured by the employee had they taken reasonable steps.
The B.C. Supreme Court recently explained what type of employment will constitute comparable employment when an employee is attempting to mitigate their damages.
In Okano v Cathay Pacific Airways (2022 BCSC 881), the employee was terminated by the employer, Cathay Pacific Airways (“Cathay”) after 35 years of employment. The employee was employed in the Cathay’s Sales and Customer Service Departments and was the most senior person in her department at the time of termination. Following her termination, the employee was provided with two months working notice and three months of severance required by the Canada Labour Code.
The employee did not search for employment during her working notice period nor for two months following her termination. The employee stated that she felt depressed during this time. The court noted that an employee is not required to immediately commence a search for comparable employment. There should be a reasonable amount of time to process the termination, coordinate the next steps and properly research new employment opportunities. In this case, the Court did not take issue with the length of time that the employee took before commencing a job search.
However, the employee chose to then engage in a three-month career coaching program because she wanted to change career paths and did not want to return to the airline industry, where she had been employed for over 35 years. She did not apply to any positions in the airline industry but applied for 50 employment positions outside of the airline industry. The employee was unsuccessful in finding employment. Cathay submitted evidence that there were several job postings for employment positions comparable to the employee’s role with Cathay.
The Court found that it was not reasonable for the employee to apply to jobs outside of the airline industry, stating “…it was incumbent upon the Plaintiff to explore available positions in the very industry in which she had spent her entire working life.” As a result, the Court reduced the employee’s reasonable notice period by three months.
Further, the Court reduced the remaining amount of damages by 15%, stating, “there is a real and substantial possibility that she will find a new job commensurate with her qualifications and experience at some point during the balance of the notice period.”
While the threshold is typically high for an employer to demonstrate that an employee has failed to mitigate their damages, this case supports that an employee is not properly doing so if they only apply for jobs in a field/industry outside of their expertise and that a reduction in award by several months may even be warranted. Employers are encouraged to seek advice on whether an employee has failed to mitigate their damages. Our lawyers at Heeney Vokey LLP are happy to help with this.
 It is important to note that this case falls within Federal jurisdiction; however, the principles equally apply to provincially regulated employers.