Weak Job Market Supports Longer Notice Periods

A weak job market is a factor that can justify a longer notice period for wrongfully dismissed employees. This is because the availability of similar employment - or a lack thereof - is a factor that courts take into consideration when assessing notice periods. This post examines why and how a weak job market can be used to justify a longer notice period in appropriate circumstances.

Why does a weak job market matter?

To understand why a weak job market may affect an employee's notice period, it is helpful to review how a reasonable notice period is assessed in the first place. There is no mathematical or scientific process to be used when determining the length of a reasonable notice period (unless the parties have agreed on a specific formula in the employment contract). Rather, a reasonable notice period is simply intended to provide a wrongfully dismissed employee with a fair opportunity to obtain similar or comparable re-employment.

Some factors that are relevant to determining what would be a reasonable period of notice for a wrongfully dismissed employee include:

  1. The character of the employee’s employment;
  2. The length of service;
  3. The age of the employee; and
  4. The availability of similar employment (having regard to the experience, training, and qualifications of the employee).

The fourth factor - availability of similar employment - can justify a longer notice period if there is evidence that there is a scarcity of similar employment available. It has long been the rule in BC that a weak job market can lengthen a notice period, although this factor should not be given undue emphasis. As stated by the BC Court of Appeal in Hunter v. Northwood Pulp and Timber Ltd., 1985 CanLII 443 (BC CA):

The lack of available employment opportunities resulting from a depressed economy is a factor to be taken into account...The economic factor must not be given undue emphasis.

What impact does a weak job market have on a notice period?

The extent to which a weak job market may impact a reasonable notice period is demonstrated in various BC wrongful dismissal decisions, including:

  • Kerfoot v. Weyerhaeuser Company Limited, 2013 BCCA 330: "It is, for example, clear that dismissal into a weak labour market may extend, to a modest extent, a notice period, but not to the point of making the employer entirely liable for the unavailability of alternate employment."

  • Waterman v. Mining Association of British Columbia, 2016 BCSC 921: "In my view, Ms. Waterman’s unique background in the mining industry, the nature of her responsibilities she fulfilled in her position, and combined with the economic downturn in the mining business (which has resulted in a significant reduction in reasonable alternate employment opportunities) outweighs Ms. Waterman’s short length of employment in assessing the reasonable notice period upon termination."

  • Cooper v. MacMillan Bloedel Ltd., 1991 CanLII 2004 (BC SC): "It is clear enough on the evidence that Mr. Cooper was dismissed in a time of declining prospects in the forest industry and so that is a factor to be weighed, without undue emphasis, in his favour."

For employees, the key takeaway is that a weak job market may result in a longer period of notice, although employees almost must bear in mind that:

  • It is the employee's responsibility to demonstrate to a court that a weak job market exists; and
  • A lack of similar available employment is only one of several different factors to be taken into consideration, and it will not be given undue emphasis by the courts.

For employers, on the other hand, this is another reminder of the importance of properly implementing employment contracts that explicitly define an employee's notice period. A well-drafted employment contract should include provisions that clearly and explicitly define how much notice an employee will receive upon termination, limiting an employer's exposure to unexpected claims following a dismissal.

brendan harvey - wrongful dismissal vancouver
About the Author

Brendan Harvey advises and represents employees and small businesses at all stages before, during, and after the employment relationship. His primary areas of practice include wrongful dismissal, employment standards, and human rights litigation. If you would like to schedule a meeting with Brendan Harvey or any other of our lawyers, give us a call at 604-988-1000.

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