When an employee feels they've been treated unjustly by their employer, they often think that punitive damages should be owed to them.  In reality, punitive damages are rarely awarded in wrongful dismissal cases.  The purpose of this article is to educate our readers about the main kinds of damages available for wrongful dismissal cases where employer misconduct is in issue.  Other kinds of damages, such as loss of opportunity and loss of benefits, are not discussed.

Reasonable Notice Damages - compensating for breach of contract

Reasonable Notice damages compensate the employee for the breached employment contract.  It is an implied term of every employment relationship that the employer must provide reasonable notice of termination.  This ranges from a few weeks up to 24 months, depending on the employee's age, length of employment, character of employment, and prospects of finding similar work.  The older and more senior the employee, the more reasonable notice they're likely to be owed.

Aggravated Damages - compensating for bad faith termination

Aggravated damages compensate the employee where the termination is carried out in bad faith.   Classic examples are where the employer is dishonest, unduly insensitive, or "high-handed" with the employee in the course of dismissing them.  Where the employer terminates in this way and the employee experiences mental distress as a result, aggravated damages can be awarded.  In British Columbia, aggravated damages awards usually run in the range of $25,000 to $35,000.

Punitive Damages - punishing malicious behaviour

Punitive damages are awarded to punish the employer for conduct that is malicious and reprehensible, where aggravated damages don't go far enough to get the job done.  The Supreme Court of Canada has given a concise description:

Punitive damages may be awarded in situations where the defendant's misconduct is so malicious, oppressive and high-handed that it offends the court's sense of decency... It is the means by which the judge expresses outrage at the egregious conduct of the defendant.

Often aggravated damages are enough to punish the employer, but in some cases where the employer goes above and beyond to hurt its employee, punitive damages are awarded.  For those of you who are interested to learn the mechanics of punitive damages awards, the Supreme Court of Canada has provided an 11-point "road map":

1. Punitive damages are very much the exception rather than the rule;
2. They are imposed only if there has been high-handed, malicious, arbitrary or highly reprehensible misconduct that departs to a marked degree from ordinary standards of decent behaviour.
3. Where they are awarded, punitive damages should be assessed in an amount reasonably proportionate to such factors as the harm caused, the degree of the misconduct, the relative vulnerability of the plaintiff and any advantage or profit gained by the defendant;
4. Having regard to any other fines or penalties suffered by the defendant for the misconduct in question.
5. Punitive damages are generally given only where the misconduct would otherwise be unpunished or where other penalties are or are likely to be inadequate to achieve the objectives of retribution, deterrence and denunciation.
6. Their purpose is not to compensate the plaintiff; but
7. To give a defendant his or her just desert (retribution), to deter the defendant and others from similar misconduct in the future (deterrence), and to mark the community’s collective condemnation (denunciation) of what has happened.
8. Punitive damages are awarded only where compensatory damages, which to some extent are punitive, are insufficient to accomplish these objectives; and
9. They are given in an amount that is no greater than necessary to rationally accomplish their purpose.
10. While normally the state would be the recipient of any fine or penalty for misconduct, the plaintiff will keep punitive damages as a “windfall” in addition to compensatory damages.
11. Judges and juries in our system have usually found that moderate awards of punitive damages, which inevitably carry a stigma in the broader community, are generally sufficient.

In wrongful dismissal cases, aggravated damages are awarded much more frequently than punitive damages.  If you think your employer has treated you in the malicious and oppressive way described above, you should contact an employment lawyer to discuss your case and learn about your rights and your options.