Employment Law: Termination

Employment Law: Termination (New Brunswick Court of Appeal)

The Applicant, AMEC Americas Limited, doing business as AMEC Earth and Environmental (“AMEC”) was in the business of engineering and product management. The Respondent, MacWilliams commenced full-time employment with AMEC in 1991 and was hired for an indefinite term.

On February 15, 2010, AMEC dismissed MacWilliams from his employment as Head of Client Services at its Fredericton office. He was 42 years old. AMEC’s termination letter did not allege just cause. AMEC paid 4 weeks’ salary pursuant to the N.B. Employment Standards Act. It also offered to settle MacWilliams’ potential claim by paying his salary for a maximum of 12 months. The offer was subject to the condition that AMEC would only pay 50% of full salary if and when MacWilliams entered into any employment commitment, regardless of its actual terms and conditions. MacWilliams did not accept this offer to settle.

Between February 15, 2010 and April 1, 2010, AMEC continued to pay MacWilliams’ base salary, as well as RRSP contributions and health and dental coverage. On April 1, 2010, AMEC made a second settlement offer. AMEC would continue to pay MacWilliams’ salary for 16 months but the payout would be reduced to 30% should he secure an employment commitment regardless of its actual terms and conditions. MacWilliams rejected this offer of settlement. AMEC continued to pay MacWilliams’ base salary, RRSP contributions and health and dental coverage until May 6, 2010. On this date, AMEC renewed the second settlement offer and informed MacWilliams that unless he accepted this offer, his employment benefits would cease the next day. MacWilliams rejected this final offer of settlement and AMEC terminated his employment benefits on May 7, 2010.

On October 4, 2010, MacWilliams was granted summary judgment with respect to the issue of whether he was dismissed without notice. AMEC’s defence that MacWilliams had failed to accept an offer to settle and by doing so failed to mitigate and was therefore not entitled to relief was not accepted. At trial, MacWilliams was found to be entitled to 20 months notice. AMEC was directed to pay MacWilliams all amounts to which he would have been entitled during that period. AMEC’s appeal was allowed but only for the limited purpose of assessing MacWilliams’ damages.

Amec Americas Limited, dba: AMEC Earth & Environmental, a body corporate v. Lee MacWilliams (N.B.C.A., May 17, 2012) (34905) “The application for leave to appeal to SCC… is dismissed with costs.”