A long-term worker who lost his job at a Vancouver hotel at the start of the pandemic as business collapsed has been awarded 18 months’ notice for wrongful dismissal.
Angelo Nicolas started working for the Pan Pacific Vancouver in 1988 as a houseperson and had 32 years’ seniority at the time of dismissal.
In March 2020, when the COVID-19 pandemic struck, international and business travel virtually ceased, severely limiting the hotel’s ability to operate. Before the pandemic, it employed about 440 people.
In April 2020, Nicolas was put on a temporary layoff. On Dec. 9, 2020, he was terminated via a letter.
He filed a lawsuit for wrongful dismissal and sought two years’ pay in lieu of notice as well as punitive and aggravated damages.
The hotel acknowledged that it owed him compensatory damages for wrongful dismissal, but said two years’ notice was too high, and denied any liability to pay punitive or aggravated damages.
No formal employment contract
Nicolas didn’t have a formal employment contract. When he was hired, the hotel had a different owner and all he had was a half-page letter confirming his hiring as a temporary “houseman” for six months. If he satisfied the probationary period, he would be eligible for coverage in the group benefits plan.
There was no evidence of a further employment contract or terms, and nothing that restricted severance or notice period at time of termination.
The current owner of the hotel, Ocean Pacific Hotels Ltd., took ownership of the property in 2002 and assumed his employment.
The hotel is a large operation, with 500 rooms and 25,000 square feet of meeting space. It caters primarily to corporate clientele but also has some leisure travellers. On average, pre-pandemic, it was more than 85 per cent occupied.
Nicolas didn’t change jobs during his entire time at the hotel — he was classified as a “regular” employee and rose to the top seniority level in the department. His hourly wage was $24.40 plus benefits. As a houseperson, he supported housekeeping and other departments, acting as a “runner” to help where needed in all areas with the exception of food and beverage. He worked near full-time hours.
Full time or not?
There was a dispute over whether or not he was full-time. Nicolas said he was indeed a full-time worker, but the hotel argued he was hourly and called in only when needed. It showed that his earnings in 2018 were based on an average of 34.3 hours per week; in 2019, his earnings were based on 38 hours per week.
Zul Somani, the senior asset manager at the hotel (equivalent of a general manager) testified that Nicolas’ hours could be cut if the hotel’s business decreased without raising the prospect of constructive dismissal.
Somani’s testimony shows just how hard the pandemic hit the industry. In April 2020, the hotel rented about 40 rooms in the entire month — slightly more than one room per night.
Editor’s note: There is a lot of interesting discussion in the ruling (see paragraph 17) on how the hotel handled the terminations and callbacks to stickhandle provincial employment standards. It’s beyond the scope of this case, but is worth a read if you’re interested.
The employer worked with its insurance company, Manulife, to continue benefits coverage for the laid-off employees at a cost to the hotel of $350 to $400 per month per employee. But in December 2020 it advised the hotel that it would not extend coverage for inactive employees past Jan. 1, 2021. The hotel then contacted all its remaining hourly employees, including Somani, and let them know their employment was being terminated.
The employer advised that it would pay “the minimum individual termination pay entitlement that would be required under your contract for a without cause termination outside the circumstances of COVID-19.”
No houseperson was called into work until June 26, 2021.
CERB and other work
Nicolas applied for, and received, benefits under the Canadian Emergency Response Benefit (CERB) over a period of 28 weeks. He received a total of $14,000 that covered from mid-March 2020 to Sept. 26, 2020.
He found another job at a care home on Nov. 30, 2020 and started as a casual employee. He was not full time as of the time of the decision and was earning $20.56 per hour, which was less than his hotel wage.
The court concluded, based on the letter from the hotel, that Aug. 30, 2020 was the termination date. The hotel accepted that as the appropriate date.
Next up was the reasonable notice period. The court referred to the Bardal factors (age, character of employment, length of service, availability of similar employment) to arrive at “an objectively reasonable result.”
The hotel argued Nicolas would not have received any hours from the date of the termination for a number of months because of the lack of work caused by the pandemic. It did not argue that no damages should be payable, just that the availability of work as a result of the slowdown should be a factor.
The Bardal factors
The court addressed each of the factors one by one.
Character of employment: The responsibilities Nicolas had were, in many ways, commensurate with entry-level workers and “modest,” the court said. The general principle is that, the more important the job, the more difficult it will be to replace.
Age: Nicolas was 58. The primary reason to consider age is that older workers may find it harder to find a new job.
Length of service: Nicolas had 32 years’ tenure — quite obviously at the longest end, the court said.
Availability of alternate employment: Nicolas did find another job, but at a lower rate of pay and not with full-time hours.
The notice period
Nicolas sought 21 to 24 months’ pay; the hotel countered with 12 months.
Though Nicholas was able to almost immediately find another job, 12 months was just too short a period, the court said. He was a long-term employee and entitled to be considered near the high-end for reasonable notice.
But that period was reduced somewhat by the character of his employment and the fact he did find another job “quite quickly,” the court said.
It fixed the notice period at 18 months at his rate of income in 2019. It deducted the following amounts:
- $7,808 representing the two months’ pay he received in lieu of notice
- any amount received from his new employment at the care home. He earned $31,360 from Nov. 30, 2020, to Feb. 12, 2022. The notice period would take him to Feb. 28, 2022, and the court did no have the specific earnings for that gap.
- $2,000 for CERB benefits. (The court cited two cases – Yates v. Langley Motor Sport Centre Ltd. and Hogan v. 1187938 B.C. Ltd. in justifying the deduction. The law around CERB and mitigation remains unsettled, though, as other courts have ruled the opposite. For example, in one Ontario case CERB was ruled not to be a mitigation factor.) It only deducted $2,000, and not the full amount received, because that was the only amount paid out by the government during the notice period.
Punitive and aggravated damages
Nicolas said certain actions the hotel took were in bad faith — it placed its own economic interests ahead of the interests of its employees.
He sought $20,000 in damages for this.
He also argued the hotel skirted the provisions of provincial law and the deemed termination provisions by offering “casual” employment to all of its remaining employees. The employer pointed to one simple fact that made it irrelevant: Nicolas did not accept an offer of casual employment.
The court agreed.
“I make no decision, and offer no opinion, on whether the offer of casual employment would represent a breach, or avoidance, of the provisions of the act,” the court said. “The fact that the defendant made that offer did not affect Mr. Nicolas or his claim.”
Nicolas also argued the hotel used strong-arm tactics to get him to drop his claim. He pointed to an offer made by the employer in November 2021 for a janitorial position with a related company that operated in an adjoining officer tower.
It would pay the same, but required him to drop his lawsuit. The employer said it made a good-faith offer that would have settled the litigation and provided Nicolas with employment.
“There was nothing nefarious about the (hotel) offering something other than money damages to (Nicolas),” the court said. “(Nicolas) was free to accept or reject the offer. He rejected it.”
The aggravated damage claim for $30,000 (if no punitive damages were awarded) centered around the job offer at the office building being withdrawn within a day. Nicolas said he felt disappointed that the offer was withdrawn before he had a chance to think about it.
The employer, though, said there was no evidence of actual emotional impact on Nicolas. And Nicolas did have a chance to speak to his lawyer about the settlement and received advice on it. There was simply no evidence to support a claim for aggravated damages, the court said.
For more information see Nicolas Jr. v Ocean Pacific Hotels Ltd., 2022 BCSC 1052 (CanLII)