Mitigation Isn’t a Loophole: What Williamson v. Brandt Tractor Clarifies

In Ontario employment law, mitigation refers to the obligation of a dismissed employee to take reasonable steps to find comparable employment after termination. Any income earned from new employment found soon after termination may reduce the potential compensation or termination package an employer may be required to pay.

Mitigation is one of the most frequently argued and most commonly misunderstood issues in wrongful dismissal litigation. Employers often assume that any misstep by a terminated employee in their efforts to find new employment will reduce what they will have to pay. Employees, meanwhile, are sometimes advised (incorrectly) that taking a “lesser” job will not count against them.

The Ontario Court of Appeal’s decision in Williamson v. Brandt Tractor Inc., 2026 ONCA 272, reaffirms and clarifies core mitigation principles, concisely addressing two persistent areas of controversy that continue to surface in both advocacy and trial decisions.

Inferior Jobs Still Count – Clarifying the Misuse of Brake

One issue addressed in the Williamson decision traces back to how a concurring opinion in a 2017 appeal decision - Brake v. PJ‑M2R Restaurant Inc. has sometimes been applied.

The concurring decision in Brake was sometimes interpreted by both trial judges and lawyers as supporting the proposition that if a dismissed employee takes a lower-paying or lower-ranking job, income from the ‘lesser’ job should not reduce wrongful dismissal damages.  

The problem with using such a proposition based upon Brake is doctrinal: concurring reasons are not binding authority. They do not represent the court’s decision unless the reasons are adopted by a majority of the appeal court panel.

In Brake, the passages relied upon by trial judges in subsequent cases, including in Williamson—and often cited in argument by lawyers for dismissed employees—came from concurring reasons that did not reflect the law established by the majority.

The Court of Appeal for Ontario panel in Williamson expressly corrected this point. The unanimous Court of Appeal panel in Williamson confirmed that:

• The Brake concurring reasons do not state (nor are) the law in Ontario;

• There is no authority for excluding mitigation income simply because the replacement job is inferior; and,

• The binding rule remains the majority decision in Brake: income earned during the notice period is generally deductible.

Due to this, the Court of Appeal reduced the damages awarded by the income earned. It found that the trial judge had erred in refusing to deduct over $32,000 earned during the notice period on the basis that the new role was lower in status.

The takeaway:

Income is income.

The characterization of the replacement job (as the same, better, or worse) does not, on its own, remove the income earned from new employment from the mitigation analysis.

The Burden of Proof – Failure to Search is Not Enough

The second issue addressed in Williamson is the employer’s evidentiary burden in raising a mitigation defence.

Employers often argue that a dismissed employee failed to mitigate by not pursuing comparable employment. In Williamson, the Court of Appeal made it clear that this is only part of the test.

To succeed in a mitigation defence, an employer must prove both that:

• The employee failed to make reasonable efforts.

• Comparable employment was actually available, such that reasonable efforts would likely have resulted in the employee obtaining it.

In Williamson, the employer argued that the employee did not pursue comparable sales roles. However, the employer provided no persuasive evidence that such roles were available during the relevant period. As a result, that aspect of the mitigation defence failed. The Court of Appeal emphasized that an employee’s decision not to apply for certain roles does not relieve the employer of its burden to prove that real, attainable opportunities existed.

The takeaway:

Showing that an employee did not pursue comparable work is not enough. The employer must prove that comparable positions actually existed and that, as such, they would likely have been obtained.

Practical Implications

For employers:

• If arguing failure to mitigate, be prepared with concrete evidence of job availability (e.g. postings, market data, recruiter evidence)

• Do not rely on bald statements or assumptions about what the employee “could have found,” as it may well be insufficient

For employees:

• Expect that all employment income during the notice period will likely be deducted

• You are not required to pursue speculative or illusory opportunities to preserve damages

• Keep records of the job search – both what is applied for and what is posted or available in the marketplace

Final Thoughts

Mitigation arguments often sound straightforward, but they succeed or fail on precision. Williamson v. Brandt Tractor clarifies where the analysis and arguments had started to drift from the legal principles and reinforces that mitigation is neither a shortcut nor a guessing exercise. Whether advancing or defending a claim, outcomes turn on understanding who bears the burden, what must actually be proven, and the specific evidence brought before the court.

For guidance on mitigation strategy or wrongful dismissal issues, contact the Employment Law team at Lerners to discuss your situation.