Kathleen Fisher was pleased to hear the company president say, “You can stay with our company for as long as you wish.” Fisher, at 65 years of age, wanted to keep working for Lakeland Mills Ltd. where she had worked for 18 years. She initiated a meeting with Keith Andersen, the President of Lakeland Mills, to inform the company of her intention to stay on. And with his well-intentioned response, Andersen unwittingly infused Fisher with a sense of entitlement; that is, a job for life.
A year later, Lakeland’s office manager, Annie Horning, wished to replace Fisher with someone more versatile, someone who could rotate through various positions as required. The more Horning pressed Fisher to retire, the more Fisher became entrenched, a common experience for companies trying to nudge older workers toward retirement.
Instead of terminating Fisher and replacing her, Horning devised a temporary solution. Fisher would back-up the shipping clerk, while maintaining her job in accounting. These shipping duties required computer skills that Fisher did not have. But, eager to remain, she professed a willingness to acquire them.
Next, Horning played the poor-performance card. Fisher was told that unless she did a better job learning the shipping clerk’s job or retired in the near future, the company would also hire someone to take over part of her accounting work. Sensing she was being forced to retire, Fisher turned to Andersen for reassurance. He did nothing to disabuse Fisher of her fears. Fisher resigned and sued for constructive dismissal.
The B. C. Court concluded that the addition of shipping work and the deletion of her other duties constituted a fundamental change. The court awarded Fisher 10 months’ severance, with bonus and benefits.
Long-service employees often believe they have a job until they decide to retire. But, in law, there is nothing unique in a wrongful dismissal of an older employee. Provided the termination is not based on age, an older employer can be terminated with the same impunity as any other.
Given the demographics of the workforce and the devastation of most employees’ retirement accounts, more will postpone retirement at the very time employers are looking to reduce staff. However, it is a mistake to raise employees’ expectations by reassuring them they have a job for as long as they wish.
Some suggestions for employers:
- If staffing requirements change, make reasonable adjustments to job duties, but remain alert to the perils of constructive dismissal.
- Provide yourself the right to unilaterally change duties through your offer letters and employment agreements.
- If a long-service employee no longer fits your needs, instead of hoping s/he retires, terminate, as you would any other employee.
- Consider providing working notice to reduce severance costs while searching for new staff. Often the long-service employee is a prime candidate for working notice because of their maturity and dedication. Working notice allows a more graceful exit and time to perhaps adjust to the retirement they would not have embraced voluntarily.