Remedies for Reprisal: Reinstatement and the Duty to Mitigate Under the Employment Standards Act, 2000.

The Ontario Employment Standards Act, 2000 (ESA) offers employees a range of protections in the workplace, including safeguards against reprisal. The reprisal provisions under the ESA are meant to ensure that employees can exercise their rights without fear of retaliation from their employers.

Usually, if an employee has been terminated, they will forgo bringing a complaint to the Ministry of Labour in favour of an action in Superior Court. This is because the employee typically wants to claim for his or her common law reasonable notice in court, which often, is a greater entitlement for them than the remedies available under the ESA. However, things are a bit different if an employee can establish a reprisal. Indeed, there are circumstances — such as a reprisal — where an employee’s entitlement under the ESA may be greater than their common law entitlement. And it is crucial that the employer be aware of this.

What is a Reprisal?

Under the ESA, a "reprisal" refers to any negative action taken by an employer against an employee because the employee has asserted their rights under the ESA. This could include an employee filing a complaint for unpaid wages or requesting a leave of absence. The law recognizes that employees should be able to invoke their entitlements without the fear of facing punitive consequences like termination, demotion, or other adverse treatment.

Protection Against Reprisal

The ESA includes provisions that explicitly prohibit an employer from engaging in reprisal actions. Section 74 of the ESA states that an employer cannot take any disciplinary action (including termination) against an employee for exercising their rights under the ESA. This includes actions like filing a complaint with the Ministry of Labour or seeking enforcement of their employment rights.

An important aspect of the ESA's reprisal provisions is that an employee who believes they have been subject to retaliation can file a claim with the Ontario Ministry of Labour. The ministry will then investigate the complaint, and if it is found that a reprisal occurred, the employee may be awarded compensation.

Notably, there is a reverse onus when the employee makes a complaint of a reprisal. In other words, the onus is on the employer to establish that a reprisal did not occur. If it is determined that an employee was terminated for reasons even partially related to the employee’s assertion of their rights under the ESA, a reprisal will be found to occur.

Remedies for Reprisal

One of the most significant aspects of a reprisal under the ESA are the potential remedies an employee can receive if they are subject to unlawful retaliation. An employment standards officer (or the Ontario Labour Relations Board) can order that an employee be reinstated. Not even the court will make such an award. In fact, if an employee is found to have been retaliated against for exercising their rights under the Act, the presumptive entitlement is reinstatement and all past wages from the date of termination until the date of reinstatement. This is a powerful deterrent, especially in circumstances where an employment relationship deteriorates seemingly beyond repair. Termination can be a refuge for employers wishing to move on from a toxic relationship with an employee, even if they have to incur a hefty severance payment. It would be extremely difficult to welcome such employees back to the workplace with open arms.

However, employment standards officers and the Ontario Labour Relations Board are increasingly refusing to order reinstatement because they think it would be inappropriate in the circumstances. Where that occurs, the employee may be awarded damages for the loss of the value of the job or loss of reasonable expectation of employment. Adjudicators have generally awarded one month per year of service under this head of damages. This approximates an employee’s entitlement to reasonable notice.

A key difference to note is that, unlike reasonable notice, damages for the loss of the value of the job are not subject to mitigation. This means that the employee is not required to demonstrate that they have attempted to find alternative employment to receive this compensation.

For example, if an employee with five years of service is dismissed in retaliation for exercising their rights under the ESA, they could be awarded up to five months of wages as compensation, without needing to look for another job or prove that they suffered a loss of income. Again, this is a powerful deterrent, and far different than an employee’s entitlement to reasonable notice. Normally, when an employer is negotiating a severance package, the duty to mitigate looms large; it provides leverage for the employer to drive down potential severance payments. But this is not the case for damages for the loss of the value of the job. These employees do not need to mitigate and as such, the employer cannot make this argument.

Conclusion

It is very important for employers to be aware of the potential remedies for reprisals. Employers should seek out independent legal advice if they are planning to terminate an employee and there are circumstances which could reasonably support a reprisal claim. At Lerners LLP, we would be happy to walk you through these difficult issues.