A Purolator driver has been awarded more than $210,000 after an arbitrator ruled the company did not have cause to fire him.
In a detailed remedy award involving Purolator and Teamsters Local Union 938, Arbitrator Diane L. Gee ordered that the worker — J.R. — receive compensation for lost wages, benefits and certain overtime opportunities following a finding that his dismissal was unjust. Although he was reinstated to his driver role, the arbitrator was tasked with determining the specifics of his damages, pension adjustments and whether his mitigation efforts were reasonable. The decision also addressed vacation pay, personal days, overtime calculations, benefits top-ups and a request for punitive damages.
Early in the hearing, the arbitrator confirmed the principle that damages for unjust termination should “put the individual in the same position they would have been in had the unjust dismissal not occurred.” It also cited the Supreme Court of Canada decision in Michaels v. Red Deer College, which establishes that while a terminated worker must take reasonable steps to mitigate, the burden is on the employer “to show that the plaintiff either found, or, by the exercise of proper industry in the search, could have procured other employment of an approximately similar kind.”
Throughout the lost wages period, the Grievor’s total regular wage loss was determined to be $293,008.40. He was found to have taken all required steps to mitigate his losses, although the arbitrator deducted sums he had earned in two separate capacities: first, $14,495.48 in income as a driver for another entity; and second, a further $96,466 in “replacement income” from real estate work. The arbitrator arrived at that real estate figure by comparing J.R.’s established “pre-discharge earning level” to his “ramped up” earnings during his period off work.
Regular wages and pension
The parties agreed that his regular wage loss totalled $293,008.40 for the period he was out of work. They also agreed on adjustments to his pension to reflect his reinstated status.
In practical terms, J.R.’s pension statements will be amended, and revised T-4 slips will be issued for each year in which he was improperly out of the workplace.
Mitigation efforts
After citing Michaels v. Red Deer College, the arbitrator found that J.R. did undertake efforts to mitigate. The employer argued that he had failed to take reasonable steps to find a job of a “comparable position reasonably adapted to his abilities.” In particular, it alleged he turned down a position at a transportation company. J.R. testified he was never offered that job and that the work in question was “fueling and washing trucks,” which the arbitrator noted was not “a comparable position.”
Discussing J.R.’s documentary evidence of his job search, the arbitrator acknowledged he had little in writing but accepted his sworn testimony, finding that “the onus is on the employer to prove the Grievor failed to take reasonable steps to mitigate.” Ultimately, the arbitrator determined the employer did not discharge that onus.
J.R.’s real estate earnings brought a further dispute. Before his dismissal, he had made limited money as a realtor while working full time for the employer. After losing his job, he significantly increased his real estate business. The arbitrator relied in part on the approach in B & B Heavy Civil Construction Ltd., concluding that a portion of his boosted real estate income should be deducted. It calculated this by estimating his monthly pre-discharge level of real estate earnings and excluding that amount from the mitigation figure.
Vacation pay, personal days and overtime
The Union argued that J.R. deserved separate compensation for unused vacation and personal days. The arbitrator rejected that, concluding the wages figure already included these forms of pay. It noted J.R. “always took his vacation” and similarly used his personal days, meaning any entitlement was already subsumed within the standard wage calculations.
However, the arbitrator found J.R.’s historical record showed a modest appetite for overtime. From January to May of the year he was last employed before termination, he averaged just two overtime hours per month. While working as a “Relief Courier” prior to that, he averaged eight hours of overtime per month. As there was “no evidence” suggesting he would have changed his overtime habits, the arbitrator ruled he is entitled to compensation for two hours per month for part of the first year off work (when he would have been in the shunt position) and eight hours per month for the remainder of the period (when he would have been a Relief Courier).
Group health and benefits
Citing both arbitral and civil decisions, the arbitrator noted that a 15 per cent top-up can apply in cases where an employee is denied reinstatement altogether and loses union representation. However, J.R. was reinstated, making the circumstances more akin to a standard wrongful-dismissal damages claim.
Accordingly, the arbitrator concluded a 10 per cent top-up on regular wages (totalling $293,008.40) was appropriate “to compensate the Grievor for lost benefits.”
Interest, punitive and aggravated damages
The arbitrator ordered the employer to pay post-judgment interest on all amounts owed to J.R. The Union had also requested an additional $25,000 in punitive and/or aggravated damages, citing alleged bad faith and unfair treatment.
Quoting Keays v. Honda Canada Inc., the arbitrator stressed that the “normal distress and hurt feelings resulting from dismissal from employment are not compensable.” It also found insufficient evidence of conduct that rose to a high-handed or punitive level. In its words, “no award of punitive, aggravated or general damages is appropriate.”
In concluding, the arbitrator retained jurisdiction to resolve any disputes arising from final calculations. It noted that while the employer had challenged aspects of J.R.’s claims, its positions did not rise to the level of unfair or bad-faith conduct. The award therefore directs the employer to compensate him for back wages, overtime and a benefits top-up, minus properly calculated mitigation income and without extra damages for alleged bad faith.
For more information, see Purolator Inc. v Teamsters Local Union 938, 2025 CanLII 47 (CA LA).
