When an employee’s employment is terminated without cause, in the absence of an enforceable termination provision in an employment agreement, the employee will be entitled to reasonable notice of termination of employment at common law. The amount of reasonable notice an employee is entitled to is determined by the courts with reference to factors including the employee’s age, tenure, position, duties, education, experience and the availability of alternative employment. Reasonable notice decisions are not formulaic however, and the criteria appropriate for consideration, as well as the weight accorded to each factor, are not closed and will vary with each case.

In the recent decision of Cabott v. Urban Systems Ltd., 2015 YKSC 25; 2016 YKCA 4, the Supreme Court of Yukon awarded a 53-year-old employee, who had been employed as a professional planner and supervisor for approximately 14 months at the time of her without cause termination, damages reflective of six months of reasonable notice.

Lesley Cabott, a senior and experienced planner, was originally from British Columbia but had been living and working in Whitehorse when she was hired by Urban Systems Ltd. (“Urban Systems”). Urban Systems retained Ms. Cabott because she represented an opportunity to expand its northern business, including in the Yukon, Northwest Territories and Alaska. Ms. Cabott was not induced by Urban Systems to accept the position, though she apparently was interested in the organization in part because it had a business presence in Western Canada, including offices in the Lower Mainland of British Columbia where she hoped to eventually relocate and retire. However, on the evidence, this aspiration did not form part of the contract of employment or the employer’s purpose in hiring Ms. Cabott.

Original damages award ruled as excessive on appeal

Ms. Cabott was terminated without cause after fourteen months of employment. In awarding Ms. Cabott the equivalent of six months of reasonable notice, the Supreme Court considered her age, the fact that she was in the latter stages of her career, her specialized knowledge, her senior position as a supervisor, and the expectation of secure employment and possible eventual transition of work and retirement to Vancouver.

Urban Systems appealed the award, and the Court of Appeal found that to the extent the Trial Judge had emphasized Ms. Cabott’s hope to eventually retire in British Columbia, the judge had erred. Because there was no evidence that Ms. Cabott’s aspirations were in any way consistent with the purpose of offering her employment, her hope to relocate based on the scope of Urban Systems’ geographic reach was not an appropriate consideration:

“This is an action in contract. That means that a unilateral life plan is outside the contract unless and until expressed in, or in some fashion brought within, the employment relationship. It is possible that a promise of a move may have compensable value to an employee, for example when a promise induced an employee to leave a secure position. On its own, however, a unilateral life plan that is not reflected in the employment contract does not extend the parties’ rights or obligations.”

The award of damages for wrongful dismissal was accordingly reduced to reflect a reasonable notice period of four months.