Home Featured Two weeks’ pay tacked on to notice period as ‘deterrent’ for employers after woman fired following parental leave

Two weeks’ pay tacked on to notice period as ‘deterrent’ for employers after woman fired following parental leave

by HR Law Canada

A Nova Scotia company has been ordered to pay a worker, terminated without cause at the end of her parental leave, an additional two weeks’ pay on top of her notice period.

The damages were tacked on for two purposes: To denounce the discrimination and act as a deterrent to future discriminatory actions, the Director of Labour Standards said.

That ruling was appealed by the employer, but the special damages were upheld by the Nova Scotia Labour Board.

What happened

Allison Elliot started working for Trans World on May 25, 2010. She followed in the footsteps of her mother, who worked for the company for 16 years. Elliot worked as an administrative assistant for Bill Clark, the company’s president.

Over the years, she took on additional responsibilities for general office management and accounting. On April 15, 2020, she entered into a maternity leave agreement. They agreed Elliot would take a 56-week leave, her participation in benefits would continue during the leave and Trans World would pay her a $200 gross weekly top up.

“The parties agreed that there was benefit for both sides in this deal,” the Nova Scotia Labour Board said. “Elliot was paid a top up during her leave, which Trans World was not required to pay to make the leave easier for her, financially. Trans World benefitted from Elliot agreeing to take a shorter leave than the 76-week leave that she was legally entitled to.”

New accounting software

When Elliot was on leave, the company implemented a new accounting system called Spire. It hired Ellen Corbett, at the suggestion of the consultant that did the implementation, as controller.

Spire automated a lot of the accounting practices Elliot used to do, and she was not familiar with the software. It was agreed that when she returned from her leave, Elliot would be trained on the new system.

“There was an expectation from all that this training would take place,” the board said.

Dispute over returning from leave

On April 23, 2021, Elliot came to the office to talk to Clark about the end of her leave. At this point, the evidence between the two parties began to diverge, the board said.

Clark said Elliot told him she would only be coming back three days a week at the end of her leave. He said the meeting was brief, about seven minutes or so, and that the news she would be returning part time hit him “like a bomb.”

Elliot, though, said the meeting lasted much longer — about two hours.

She described the conversation as “great” and said they talked about personal things, as well as work-related items, including the end of her leave.

Elliot said the daycare she had previously lined up was no longer available, because it had reduced its capacity by 40 per cent due to COVID. But she made it clear she intended to return to full time as soon as possible, that she was a single parent with her own home to pay for and returning was very important to her, she said.

She said she told Clark she was exploring alternatives, including having family members watch her baby, and that she had secured care three days a week from June through August. After that point, a friend who would be on parental leave had agreed to watch the baby full time.

The board preferred Elliot’s version of events. It was supported by documentary evidence of her sustained efforts to secure daycare, including at locations that were inconvenient to her work and home locations.

It said it was “more likely than not that Elliot told Clark on April 23, 2021, that she still intended to return to work full time but that her ability to do so was interrupted temporarily by circumstances out of her control arising from COVID-19.”

Employer’s letter offends worker

Following that meeting, Barb Renouf — who was Clark’s wife and an employee of the company — drafted a letter to Elliot from Trans World. It was dated May 6, 2021, and sent to Elliot via email.

It outlined the terms of her return to work. It did not refer to the April 23 meeting or the issues around childcare. It identified her return date as June 14, 2021, and her hours of work as 8 a.m. to 5 p.m. Monday to Friday; amounting to 42.5 hours per week at $23 per hour.

It also stated that some her responsibilities were changing compared to her job prior to the leave. The board concluded the primary differences were:

  • in relation to her accounting responsibilities, she will be “working under the attention of” Corbett, Trans World’s new controller
  • her daily work schedule was changing from 7:30 a.m. to 4 p.m. to 8 a.m. to 5 p.m.
  • her weekly hours of work were changing from 45 hours to 42.5 hours.

Elliot was offended by the letter because it didn’t mention the April 23 meeting and the agreement she thought she reached with Clark.

She didn’t know she would be reporting to Corbett, was concerned about her work being reduced by 2.5 hours per week and that it didn’t reflect the relationship she had with Clark and Renouf.

On May 14, Elliot and Clark had a phone call. The board found that, during the call, Clark asked her to advise him in writing by May 19, 2021, about the status of her search for childcare.

‘Straw the broke the camel’s back’

On May 25, Elliot sent an email to Clark that detailed the circumstances of their communication starting with the April 23 meeting. It covered a number of items, including her understanding of the conversations and expressing that it had always been her intention to return full time.

She expressed concern about Clark’s change of heart, as well as her perceptions about changes to her terms and conditions of employment. In short, she was trying “to get rid of the confusion” she was experiencing.

Clark, though, said the May 25 email was the “straw that broke the camel’s back.” He characterized it as “demanding” and thought it was misconduct.

“He stated that his communications to Elliot did not contain a “proposal” about her work, but instead a direction as to what her job would be upon her return from parental leave, which is within Trans World’s authority to establish as her employer,” the board said.

The board ruled her email was “within the range of choices that a reasonable employee would make” in these circumstances.

Nonetheless, Clark and Renouf saw it otherwise and contacted the Labour Standards Division of the provincial department of Labour, Skills and Immigration for advice on terminating her employment.

Termination letter

Elliot received a letter from Trans World terminating her employment effective June 14, 2021. It confirmed she would be paid eight weeks’ pay in lieu of notice. It was signed by Clark and stated:

“I’m sorry I cannot accommodate your change in your employment to 3 days a week. The position that I held open for you while you were on maternity leave is a full-time position.”

Elliot found the letter hurtful and said she was “panicked” because she was a single mom coming off parental leave and she needed a job.

Elliot quickly found another job, being unemployed for just one week. On June 21, 2021, she started a job with the Workers’ Compensation Board on a temporary basis. Her role was later made permanent. Her weekly earnings at Trans World were $1,035. Her weekly earnings at her now job are $852.10, for a difference of $182.90 per week.

She was able to secure full-time childcare on July 5, 2022.

“The board finds that Elliot’s full time reemployment and her success in securing full time daycare corroborate her testimony that it was her intention throughout her discussions with Clark to return to work full time and to enroll her baby in full time childcare,” it said. “Had she intended to work part time and secure part time childcare, this would more likely have been the choice she made following her termination from Trans World.”

Employer claimed resignation

Trans World took the position that Elliot resigned when she refused to return to work on a full-time basis following her parental leave.

Alternatively, it argued her insistence on a three-day workweek amounts to wilful misconduct and satisfied the threshold for just cause. The May 25 letter was “insolent” to the point where it negated her claim for common law damages or damages associated with discriminatory action.

Lastly, even if it was wrongful dismissal, any damages owed were more than mitigated by the eight weeks’ severance pay and the earnings from her new job at the WCB, it said.

The board’s ruling

The board concluded Trans World dismissed Elliot without cause. Further, it did so in a way that discriminated against her for taking parental leave.

Elliot sought 11 months’ notice, but the board settled on eight months.

The earlier director’s decision tacked on an additional two weeks pay for the “dual purpose of denouncing the discrimination and offering a deterrent to future discriminatory actions.” The board upheld those damages.

In total Elliot was entitled to $36,225 for eight months’ reasonable notice and an additional $2,070 for the two weeks’ pay. From that, the board deducted the $8,280 Trans World had paid in severance and the $28,971 she earned during the notice period at her new job.

The balance payable to her by Trans World was $1,044, less statutory deductions.

For more information, see Trans World Distributing Ltd. v Elliot, 2022 NSLB 98 (CanLII)

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