Notice of termination of employment: the reasonableness of article 2091 C.c.Q.
When an employer has to terminate an employee's permanent contract, the factual circumstances will be decisive in order to manage this dismissal appropriately. They are also used to assess the reasonable notice that may be due to this employee.
Article 2091 of the Civil Code of Quebec provides for this measure upon termination of employment. This article applies to any individual permanent employment contract in Quebec:
2091. Either party to a contract for an indeterminate term may terminate it by giving notice of termination to the other party.
The notice of termination shall be given in reasonable time, taking into account, in particular, the nature of the employment, the specific circumstances in which it is carried on and the duration of the period of work.
This notice, or period of leave, essentially exists in order to allow the employee to be compensated for the loss of his job. The goal is to allow the employee enough time to seek and find comparable employment. There are many criteria for determining the amount of such reasonable notice:
nature, functions occupied and importance of the work;
the fact that the employee has left a certain and gainful job;
the intention of the parties;
the difficulty of finding another position of equal or comparable importance;
the employee's number of years of service and age;
the employee's educational level;
employee training;
the long-term future within the company.
These criteria for determining notice have been widely recognized by case law, which invariably applies them, as the case may be. As a general rule, the most decisive criterion remains the length of employment of the dismissed employee. Without being allowed to speak of a mathematical rule, the court could calculate the notice by applying an informal “scale” of 2 to 4 weeks' (gross) salary per year of employment of the employee, while keeping a ceiling rarely exceeded of 24 months of salary, for qualified employees of senior management or salaried executive of a company.
That said, the determination of the period of leave remains a factual issue and the discretion of the court may intervene, in one direction or in the other. The Quebec Court of Appeal has often recalled this difficulty in several cases. This is particularly the case in Standard Broadcasting Corp., written by Baudouin J.A . (free translation) :
“[...] What constitutes a reasonable period of notice, in the event of an indefinite contract, is essentially a question of fact which varies with the circumstances of each case, from a certain number known parameters: nature and importance of the function; giving up another job to acquire it; employee's age, number of years of service and experience; ease or difficulty of finding an identical or similar occupation; subsequent job search; existence or non-existence of serious reasons for dismissal ...
The notice period is essentially for compensation and is intended to allow the employer to terminate the contract. [...]. The courts then act as arbitrators and must arrive, apart from a strict actuarial or accounting valuation, at a figure which, taking into account all the circumstances, appears fair and reasonable. This figure, however, is obviously based on certain economic data, in particular the amount of the former remuneration of the ex-employee. [...]
It is especially important not to sterilize the jurisprudence by a blind adherence to so-called "standards" [...] and thus to keep an essential flexibility, guarantor of a better individual justice.
A reasonable notice period therefore depends on the circumstances of each case and on an impressive combination of factors [...]. The authority of the precedent must therefore be gauged here with caution, even if the many decisions in the matter, by their collective wisdom, bring interesting points of comparison. ”
However, it is up to the employee to demonstrate that he has attempted to reduce the damage associated with the absence or inadequacy of paid compensation in lieu of notice.
This mitigation of damage is, moreover, an imperative, although the particular circumstances of the employee may alleviate this obligation. In practice, such an obligation means that the dismissed employee must make a reasonable effort to find a job in the same or a related field. Also, he cannot refuse offers of employment which, in the circumstances, would be reasonable. But here too, the court may consider the difficulties inherent in the employee, or his age, to conclude whether the employee has sufficiently mitigated his damage before asking the court for payment of a period of leave.
This was the case in 2013, in Standard Desk Inc., where the Court of Appeal considered the advanced age of an employee at the time of his dismissal (he was 75 years old), before reversing the decision of the Superior Court on this specific point, and conclude that any effort of this employee to find a job comparable to his age would have been doomed to failure.
These principles may apply differently in terms of the employment contract governed by a collective agreement or by a collective agreement decree. And in the event of the termination of a fixed-term employment contract, the compensation generally due to the employee will be calculated rather according to the salary agreed for the balance of the duration of the contract.
It can therefore be difficult for the employer to assess precisely what a reasonable period of leave would be before proposing it to the employee whose contract ends.
Dismissing an employee is a decision that must be considered and reasoned. It may be beneficial for an employer to offer more generous than reasonable notice, in return for a negotiated transaction and a waiver that will protects him from any recourse from the employee.
We can advise you on any file involving the termination of an employee and represent you in the event of a legal or administrative dispute.
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