On September 15, 2022, the Ontario Superior Court of Justice released the decision Pohl v Hudson’s Bay Company, 2022 ONSC 5230, in which Justice Centa admonished the employer, Hudson’s Bay Company (“HBC”) for its conduct in terminating the plaintiff, Darren Pohl.

Background

Pohl was a longstanding employee of HBC with 28 years of loyal service. HBC’s decision to terminate him was due to restructuring and was not related to misconduct. Upon his termination he was walked out through the front door. Thereafter HBC did not pay him all his termination entitlements as required by
the Employment Standards Act, 2000 (“ESA”) in lumpsum within 7 days of the termination. Instead, the company made bi-weekly payments and further did not provide him a Record of Employment within a timely manner.

Shortly after the termination Pohl was made an offer of alternative employment with the company. The
clauses therein gave HBC a unilateral right to change the terms of his employment, entailed that Pohl would have to give up any right to pursue his common law entitlements from the termination, and
fundamentally changed the nature of his work at reduced compensation. Not only was Justice Centa unconvinced as to the enforceability of some of the language, but the judge also described HBC’s
ambitiousness as “breathtaking”. Pohl did not accept and he retained a lawyer.

Pohl’s lawyer subsequently contacted HBC and demanded payment for outstanding wages, which included his ESA termination entitlements. The company did not comply for nearly 2 months after this
request (total of 3 months late).

Court’s Decision

Justice Centa awarded Pohl 24 months’ notice less amounts already paid and compensation for lost benefits. In addition, the judge was sympathetic to Pohl and awarded $45,000 in moral (bad faith) damages and an additional $10,000 in punitive damages to for the HBC’s conduct.

While it was acknowledged that it is generally a high bar to award moral and punitive damages, Justice Centa found the award appropriate in this case for the following reasons:

1. Walking Pohl out the door was insensitive and HBC had no reason to treat him this way;

2. HBC’s job offer was an attempt to take advantage of a vulnerable employee and to extinguish his rights upon termination;

3. HBC did not have the option of not paying Pohl his ESA termination entitlements in lump-sum within 7 days of his termination; the company deliberately flouted the law and its conduct was
unacceptable; and

4. It failed to issue a Record of Employment in a timely manner and when it did, the ROEs
incorrectly described the reasons for issuance, the date of the termination, and even stated that
Pohl’s return was “unknown” when it should have listed him as “not returning”.

Overall, Justice Centa found that HBC placed its interests above Pohl’s and this had an impact on his feelings of exploitation, humiliation, and depression.

Takeaway

This ruling is yet another reminder that employee terminations are to be conducted in a sensitive manner and must comply with the employer’s obligations under the ESA. Despite an employer’s financial circumstances, the court will not be sympathetic to organisations that flagrantly violate their statutory obligations, and in some cases may award greater moral and punitive damages where these violations are in tandem with pressuring vulnerable employees to sign away their rights.

Conversely, employees should be mindful of the conduct of their employer when being terminated and ensure that they are being provided all their wages and benefits. If you have been terminated and faced
any of the above or similar issues, reach out to the lawyers at JPak for advice on your rights.