Playing Hardball with Fired Worker Expensive Error


Randall Echlin, a judge sitting on the Ontario Superior Court of Justice, loves baseball.

He’s been named as one of Canadian baseball’s top 100 figures for the past two years. He’s heavily involved with the Canadian Baseball Hall of Fame and sat in his customary seat for the Blue Jays’ home opener on April 1.

But as a judge, he hates hardball tactics. He made that loud and clear in an employment law decision handed down earlier this year.

At bat was a 63-year-old plaintiff, Luis Romero Olguin. Throwing high inside fastballs was his employer, Canac Kitchens.

Olguin had been employed by Canac, which manufactures kitchen and bathroom cabinets, for almost 24 years. He was fired in 2003 during a restructuring, without just cause, at the age of 55.

Canac gave Olguin a payment of 32 weeks pay, the bare minimum under employment standards legislation. It s benefits for the employment standards minimum of eight weeks.

Thirty-two weeks pay for a 55 year old after 24 years of service: That’s hardball tactics.

After hearing evidence and argument over a period of four days, Justice Echlin declared Olguin the winner, concluding Canac ought to have provided a termination package consisting of 22 months, not the skimpy 32 weeks given. That didn’t cost Canac much, as Olguin had obtained another job a month after being fired.

What ended up costing Canac a lot of money was its failure to have offered or provided sability coverage to Olguin as part of the termination package.

By neglecting to provide or offer disability coverage as part of the termination package Canac was taking a calculated risk.

If Olguin became disabled within the reasonable notice period — which the court found to be 22 months — then Canac could be on the hook for disability
payments Olguin would have received under a disability insurance policy.

And that’s exactly what happened. In 2004-5 Olguin developed cancer, received treatment and underwent three rounds of surgery. More surgery may be in store for Olguin.

Canac argued Olguin should have purchased his own disability coverage but Justice Echlin rejected that argument noting there was “insufficient evidence” Olguin could have obtained coverage.

So Canac was ordered to make all the disability payments that would have been paid to the date of trial, as well as the payments that should have been made until Olguin reaches age 65, the age when coverage under any disability policy would have terminated. That works out to a tidy sum of about $200,000.

In case Canac didn’t get the message, Justice Echlin awarded a further $15,000 due to its “hardball approach” in its “cavalier, harsh, malicious, reckless,
outrageous and high-handed treatment” of Olguin.

To top it off, he ordered Canac to pay $125,000 towards Olguin’s legal costs.

This wasn’t Canac’s first experience at the Ontario Superior Court of Justice in a wrongful dismissal lawsuit.

There are many lessons in this decision for employers. Many employers engage in hardball tactics by providing the bare minimum notice and severance pay even as they clearly understand what they’ve paid amounts to a wrongful dismissal.

Many refuse to provide benefits — like disability insurance — beyond the minimum eight weeks mandated by employment standards laws, even though wrongful dismissal law requires more. Most get away with their hardball tactics. Most employees grin and bear it and move on. They lack either the knowledge, resolve or resources to take action.

But every once in a while someone like Olguin comes along with the fortitude to take his case to trial.

Every once in a while an employer gets its wrist slapped and gets called out at the plate.

Article ID# 3078601

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