Compensation Wrongful Dismissal

The measure of damages for wrongful dismissal is governed by the length of the notice period in the contract of employment, because what makes the dismissal unlawful at common law is the employer’s failure to give due notice or wages in lieu of. Therefore, the employer can recover only for wages and benefits that he or she would have been legally entitled to during the contractual notice period.

If the employer acted in a particularly repulsive way in the manner of dismissal, there is no additional recourse for the employee unless the employee can show that the employer’s conduct constituted an independently actionable tort such as mental distress (Honda v. Keays).

When dismissed, an employee has a duty to mitigate damages (Evans v. Teamsters). The dismissed employee has an obligation to seek alternative employment immediately to minimize their loss. Where the employer has offered the employee a chance to mitigate damages by returning to work, the central issue is whether a reasonable person would accept such an opportunity.