It is one of the most important concepts in workplace law — but it is not even clear how it applies.

Since 1997, when the Supreme Court presented Canadian workplaces with the Wallace decision, employers have had an obligation to play nice and behave well at the time of dismissal, or face paying additional “bad faith” damages to a former employee. As the Court reasoned, employees were particularly vulnerable at the time of dismissal and in need of additional protection.

But in the landmark decision in Honda nearly 11 years later, the Supreme Court considerably rewrote its own law. In that case the Court found that, unless there was evidence of some actual or physical harm stemming from a dismissal, employees should no longer be compensated for their mistreatment. Many employees were left shaking their heads and since this time, it has been unclear what, if any, damages they should receive if they are dismissed “in bad faith.” Fortunately, a recent case seems to clarify the law.

When Sergio Coppola was dismissed from Capital Pontiac Buick in Regina, he was told the dealership was eliminating his position and that, since he had the least tenure among his group, he was losing his job. However, when Coppola tried to start his own business a few months later, his prospective business partner was told by one of the staff at Capital Pontiac that Coppola was fired because a car had gone missing and hinted that Coppola was at fault.

 

The allegation that Coppola had engaged in misconduct affected him greatly. Coppola’s new business venture was delayed and he claimed that he was emotionally devastated, although he never went to see a doctor. Coppola sued his old employer for wrongful dismissal, based on the false allegations — and recently he was awarded additional damages based on the manner of his dismissal, even though there was no precise manner to calculate his alleged loss.



• Daniel Lublin is an employment lawyer with Whitten & Lublin LLP.

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