Case Summary: Former VP Fired While Battling Colon Cancer

Ontario Superior Court of Justice has awarded a former vice-president of a defence and security contractor, Valley Associates, $400,000, including $75,000 in punitive damages after he was fired while undergoing chemotherapy treatment for colon cancer. The court also criticized Valley Associates’ “scorched earth” defence strategy, which included alleging financial irregularities and launching a counterclaim for breach of contract, fraud and defamation against the vice president. RS, the vice president, was employed under a written contract with Valley, and the contract continued as an indefinite-term employment contract. He was frequently late in receiving payment, and at one point, he was owed more than $225,000. RS continued to work while undergoing chemotherapy, but on Jan. 25, 2019, Valley terminated his employment without cause or notice. The court said that despite using a personal services corporation, the contract was “in pith and substance an employment contract,” and there was no cause for dismissal.

“Scorched earth” Strategy

The court criticized Valley’s “scorched earth” strategy of alleging financial irregularities and launching a counterclaim for breach of contract, fraud and defamation, saying that there were “no documented performance issues, no warnings and no termination event.” The court noted that Valley had no cause to terminate RS’s employment.

Notice Period

RS sought 20 months’ notice and was 65 at the time of termination and undergoing cancer treatment. The court said that to the knowledge of Valley, RS was in a difficult financial situation because it had been unable or unwilling to pay him accrued bonuses and commissions. His prospects of finding similar or alternate employment were limited, and there was no evidence that he was planning to retire imminently. Valley compounded the harm by cutting off his benefits. The court awarded RS 20 months’ notice as a reasonable figure.

Punitive damages

The court noted that punitive damages are not routinely awarded, and it was only awarded when the defendant’s behaviour shocks the court’s conscience. The court already granted reasonable notice at the high end of the scale and costs on a substantial indemnity scale of $30,000. However, it tacked on $75,000 in punitive damages, saying that the behaviour of Valley, in this case, is deserving of condemnation.

Contact Kent Employment Law

The case demonstrates the importance of treating employees fairly and lawfully and of not using underhanded tactics to defend actions against employers. Kent Employment Law can help employers navigate the complexities of employment law and avoid the kind of conduct that the court condemns.

Sources:

MacDonald, E. (2023, April 27). Former VP fired while battling colon cancer awarded nearly $400k as court blasts employer’s “scorched earth” defence strategy. HR Law Canada. Retrieved from https://hrlawcanada.com/2023/04/former-vp-fired-while-battling-colon-cancer-awarded-nearly-400k-as-court-blasts-employers-scorched-earth-defence-strategy/

Case Summary: Former VP Fired While Battling Colon Cancer

Ontario Superior Court of Justice has awarded a former vice-president of a defence and security contractor, Valley Associates, $400,000, including $75,000 in punitive damages after he was fired while undergoing chemotherapy treatment for colon cancer. The court also criticized Valley Associates’ “scorched earth” defence strategy, which included alleging financial irregularities and launching a counterclaim for breach of contract, fraud and defamation against the vice president. RS, the vice president, was employed under a written contract with Valley, and the contract continued as an indefinite-term employment contract. He was frequently late in receiving payment, and at one point, he was owed more than $225,000. RS continued to work while undergoing chemotherapy, but on Jan. 25, 2019, Valley terminated his employment without cause or notice. The court said that despite using a personal services corporation, the contract was “in pith and substance an employment contract,” and there was no cause for dismissal.

“Scorched earth” Strategy

The court criticized Valley’s “scorched earth” strategy of alleging financial irregularities and launching a counterclaim for breach of contract, fraud and defamation, saying that there were “no documented performance issues, no warnings and no termination event.” The court noted that Valley had no cause to terminate RS’s employment.

Notice Period

RS sought 20 months’ notice and was 65 at the time of termination and undergoing cancer treatment. The court said that to the knowledge of Valley, RS was in a difficult financial situation because it had been unable or unwilling to pay him accrued bonuses and commissions. His prospects of finding similar or alternate employment were limited, and there was no evidence that he was planning to retire imminently. Valley compounded the harm by cutting off his benefits. The court awarded RS 20 months’ notice as a reasonable figure.

Punitive damages

The court noted that punitive damages are not routinely awarded, and it was only awarded when the defendant’s behaviour shocks the court’s conscience. The court already granted reasonable notice at the high end of the scale and costs on a substantial indemnity scale of $30,000. However, it tacked on $75,000 in punitive damages, saying that the behaviour of Valley, in this case, is deserving of condemnation.

Contact Kent Employment Law

The case demonstrates the importance of treating employees fairly and lawfully and of not using underhanded tactics to defend actions against employers. Kent Employment Law can help employers navigate the complexities of employment law and avoid the kind of conduct that the court condemns.

Sources:

MacDonald, E. (2023, April 27). Former VP fired while battling colon cancer awarded nearly $400k as court blasts employer’s “scorched earth” defence strategy. HR Law Canada. Retrieved from https://hrlawcanada.com/2023/04/former-vp-fired-while-battling-colon-cancer-awarded-nearly-400k-as-court-blasts-employers-scorched-earth-defence-strategy/

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