Worker’s case that loss of truck amounted to constructive dismissal was ‘Ram tough’: Court

A Dodge Ram pickup. Photo: Rinke Dohmen/Unsplash

An HVAC technician in Ontario who lost use of a company-paid truck, including insurance and highway toll coverage for commuting, has won a constructive dismissal claim against his former employer.

Michael Quesnelle was hired as a gas fitter specialist and heating, ventilation and air conditioning (HVAC) technician by Camus Hydronics/Cleaver Brooks Inc on March 10, 2014. Prior to joining Camus, he had worked for Consumers Gas and its successor companies (Enbridge and Direct Energy) from 1992 to 2014.

Camus had attempted to recruit him twice over four years before eventually hiring him. He declined an offer in 2010 but agreed to join in 2014 when the company offered to fully pay for a vehicle and its operating costs.

Toll road bills covered

The perks included covering the cost of commuting on the 407 ETR toll highway. The toll coverage was a big deal for Quesnelle, who lived in Oshawa and had to drive across the GTA to the Camus location in Mississauga.

His employment letter, signed March 8, 2014, did not reference the vehicle benefit, but there was no dispute it was part of his compensation and Camus paid for the vehicle and its operating costs for seven years. This covered both personal and business use.

In 2021, his base salary was $103,000 plus benefits that cost Camus an additional $5,511 per year. He also participated in an RRSP that the company contributed four per cent of his salary into, or about $3,565 annually.

Truck needed replacing

By 2021, the vehicle — a Dodge Ram pickup — had racked up more than 409,000 kilometers. It was no longer roadworthy, and Quesnelle wanted it to be replaced.

The company said it discussed the situation with HR, and that Camus would not be replacing the truck.

Quesnelle asked, if he purchased a new truck, whether the company would cover the cost of the plates and insurance, and whether he should return the gas card and the 407 ETR transponder.

The company’s response was that it would “provide the insurance, toll and card for the next month to allow for a transition.”

After some additional back and forth by email about the truck, Quesnelle sent a note to Camus unhappy about the loss of the vehicle benefit.

“Because of the significant changes (Camus) is proposing to my work, I feel I have no choice to set out my concerns,” he said. “Bottom-line, I am being told to take a large pay cut and I cannot afford to do this.”

He estimated the cost of a new truck at $55,000, plus $32,000 annually for operating costs. (Insurance, 407 ETR tolls, fuel and maintenance.) That would amount to about a 30 per cent pay cut, he said. If he was going to continue working for Camus, they would have to continue paying for his vehicle and the maintenance costs, he said.

On April 13, 2021, the company said it would continue to pay for truck-related expenses until May 1, 2021. He was offered the chance to buy his existing Dodge Ram truck for market value. Otherwise, he was to turn in the keys and his travel to and from job sites from May 1 on would be “reimbursed based on the (company) travel policy.”

Constructive dismissal claim

Quesnelle’s lawyer sent a note to the company. The 30 per cent reduction in compensation from its refusal to continue to pay for the vehicle and its costs amounted to constructive dismissal, he said.

He resigned effective May 14, 2021, as a result.

Quesnelle said he was treated poorly by HR when he resigned. On May 17, 2021, the company’s HR department sent the following email announcement to other employees:

Please be advised that as of today May 17, 2020 Michael Quesnelle will no longer be a team member of Camus Hydronics Ltd.

During the transition all of Mike’s tasks will be handled by Keith Long, at the Corporate Service Department.

Please ensure that all correspondence and dealings associated with Mike’s services be directed to those contact persons noted above. On behalf of Camus I thank you in advance for your patients (sic) during this period of adjustment.

If you have any questions or concerns please come talk to me.

Worker sold house and moved

Quesnelle owned two homes — one in Oshawa and one in Omemee, Ont. Because he had no income, he sold the Oshawa home and moved permanently to the Omemee residence. He sold it May 16, 2021, and moved about 70 kilometers to the new residence, which was even further from Mississauga.

On June 18, the company offered him his job back — with the fully paid vehicle benefit for one year. He declined the offer because of the commuting distance from his new home.

He also said he could not see himself “walking back into the office and face uncomfortable questions from all those who had been told he was no longer employed.”

He applied for 13 positions in the Kawartha Lakes region near his home, all of which he was overqualified for, and had not received any job offers or interviews.

The court’s ruling: Constructive dismissal

The court ruled that the company’s unilateral decision to stop paying for the vehicle altered an essential term of his employment contract and it constituted constructive dismissal.

It had no doubt that Camus had legitimate business reasons for wanting to take the keys away. Quesnelle’s role had evolved, and he was spending more time in the office providing technical support over the phone. By 2021, he was the only sales and support employee with a vehicle benefit.

While transitioning him to a standard compensation package made sense, it was still a significant change to Quesnelle’s benefits package.

“Camus was free to make this change, but only after giving (him) reasonable notice. Their decision to cancel the vehicle package at the end of April 2021 was made on just one month’s notice,” the court said.

Termination clause

The termination clause in his contract stated the following:

During your Probation Period and afterwards, you will be entitled only to notice of termination, termination pay and/or severance pay as required by the Ontario Employment Standards Act

The use of “and/or” caught the court’s attention and rendered it invalid.

“It is not clear why the word “or” was added to this clause,” the court said. “There are no circumstances under the ESA in which the employer could pay either termination pay “or” severance pay. If the employee qualifies for severance pay, it must be paid. If the employee does not qualify for severance pay, the employer does not have to pay it.”

The ambiguity that wording created made the contract unenforceable.

Notice period and inducement

Quesnelle sought 12 months’ notice, while the employer countered that no more than six months was appropriate.

At the time of termination, he was 55. He was not a senior level manager but was a skilled employee.

The court rejected the notion that Camus had induced him to leave secure employment at Enbridge/Direct Energy. It did not know what he was earning, and the mere fact it offered him a position did not qualify as inducement, the court said.

“There were no ‘guarantees’ or assurances offered,” the court said. It also pointed to the probationary period when he began, which was inconsistent with any inducement or promise of long-term employment.

It settled on 10 months as a reasonable notice period.

Mitigation and the move

The company said Quesnelle failed in his duty to mitigate by refusing the June 18, 2021, offer to return to work. Plus, moving from Oshawa to Omemee meant he chose to be in a region with fewer jobs in his field.

The court concluded he had been constructively dismissed on March 30, 2021 and resigned on May 14, 2021. Once that happened, he had no reason to live within commuting distance of Camus’ office in Missisauga, the court said.

Had he not moved, he would have been obliged to accept the offer of re-employment, it ruled. The offer from Camus “simply came too late in the game.” He was not required to stay in his home after May 14 “in the hope that he might one day receive an offer of re-employment from his former employer.”

But the court dismissed his fear about walking back into the office and facing questions from colleagues as a reason not to take the job. It was not an embarrassing or humiliating situation, it said.

“Camus’ offer of re-employment was effectively a complete capitulation on their part, and Mr. Quesnelle could have simply returned to work and, if any questions were asked, explained that he returned because the employer agreed to all of his conditions,” the court said.

While he was free to move to Omemee, that did come with fewer job prospects, the court said.

“This was a personal decision, but the employment consequences of that decision should not be visited upon Camus,” the court said.

It was not a complete failure to mitigate, so the court reduced the damages by 30 per cent — to seven months instead of 10.

Damages, including his salary and benefits (including the truck) for seven months amounted to $56,025, it ruled.

For more information, see Quesnelle v. Camus Hydronics Ltd., 2022 ONSC 6156 (CanLII)