Introduction
The Quebec Civil Code provides that each of the parties to an employment contract for an indefinite term can terminate the contract by providing notice to the other party, provided such notice is given within a reasonable time period taking into account, in particular, the nature of employment, the specific circumstances in which it is carried on and the duration of the period of work.
This provision has given rise to a comprehensive and varied case law that examines what constitutes reasonable notice in favour of the employee following termination of his employment by the employer.
In comparison, there are fewer inverse scenarios, i.e. decisions where the employer is claiming reasonable notice of termination further to the resignation of an employee. This raises the issue as to the different circumstances allowing for an employer to obtain compensation pursuant to Article 2091 Q.C.C.
The recent decision Ethica Clinical Research inc. v. Le Gall, 2015 QCCQ 3708, enlightens us in this regard.
The Facts
Ethica Clinical Research inc. is a company offering research services to enterprises carrying on business primarily in the pharmaceutical sector.
Mr Le Gall was in the service of the company for approximately six years prior to resigning. He held a position as director of biometrics and earned an annual salary of $90,000. The facts of the matter allow us to understand that this employee played a key role within the business.
Mr Le Gall offered his resignation on April 25, 2012. In his letter, he offered one week’s notice of termination to his employer. At that time, his employer requested two additional weeks for a total of three weeks, which Mr Le Gall refused.
Due to the unusually short notice period, the company was unable to deliver certain services to its clients within stipulated deadlines. It also had to retain the services of outside consultants at the last minute to pursue its operations.
Due to this untimely departure, the employer filed a claim before the Court of Quebec against Mr Le Gall. It sought an award of damages in the amount of $24,567.69, based on the standard of a reasonable notice period of 10 weeks, abuse in the exercise of the right to rescind an employment contract and the failure of the employee to have performed his work duties with prudence, diligence or loyalty during the notice of termination period.
The Judge’s Decision
The Court framed its analysis based on the three following questions:
Did Mr Le Gall give reasonable notice of termination to his employer?
- Did Mr Le Gall abuse the exercise of his right to rescind his employment contract?
- Did Mr Le Gall perform his work with prudence, diligence and loyalty during the notice of termination period?
- Did Mr. Le Gall perform his work with prudence, diligence and loyalty throughout the notice period ?
1. Five business days’ notice of termination
The Court summarizes several criteria suggested by the Plaintiff in support of its claim for a 10 week notice period: the nature of the employment, Mr Le Gall’s salary, responsibilities attached to his employment, years of service within the business, the difficulty recruiting for the position held by Mr Le Gall, specialized nature of the employment position, time necessary for training, replacement work necessary due to the absence of Mr Le Gall, cost related to low productivity of the biometrics department and the power relationship between the employer and the employee.
Without specifying which of the above factors were preponderant, the Court indicated that five business days notice given by Mr Le Gall to his employer prior to leaving his employment was insufficient. In the Court’s view, Mr Le Gall should have offered three weeks as the employer requested.
2. Abuse in the exercise of right to rescind employment contract
The Court relied upon articles 6, 7 and 1375 Q.C.C. within the framework of its analysis of the conduct of the employee. It found that Mr Le Gall’s conduct was reprehensible.
In particular, the evidence disclosed that he knew that the second-ranking senior employee in the department was also on vacation at the time of his resignation, that his resignation entered into effect and that another key employee was also absent at the same time which placed the employer in a very embarrassing situation for the conduct of its business. In fact, it proved impossible under these circumstances to carry out any transfer of know-how.
Consequently, the employer was awarded the sum of $1,500 for inconvenience and nuisance.
3. Performance of work with prudence, diligence and loyalty throughout the notice period
Based upon a succinct review of the testimony of the employer’s witnesses, the Court ruled that the employee adopted a confrontational attitude during the course of his notice period that was unworthy of his position as an executive. It therefore awarded the employer $1,000 under this head of damages.
The Court however did not provide particulars of this misconduct.
Commentary
Based on the criteria detailed and presented by the company and the delays described during the testimony by other executives of the company, the judge could easily have ruled that a notice period of longer than three weeks was appropriate. He remained with this figure because it was the number of weeks requested by the employer of Mr Le Gall during their communications prior to the latter’s departure.
We furthermore emphasize that this decision indicates that it might be judicious for an employer to provide within an employment contract a specific notice of termination clause for employees who play a key role within their business.
With respect to the duty of loyalty of an employee, this remains “even after one of the parties to a contract of employment for an indeterminate term gives the other party notice of termination” (Québec (Commission des normes du travail) v. Asphalte Desjardins inc., 2014 CSC 51), each party is bound to comply with the obligations incumbent upon it pursuant to the employment agreement up until expiration of such notice period.
The decision rendered in this matter acknowledges the importance of the respective obligations of the parties throughout the duration of the notice period. The Court will hold the resigning employee liable in such cases for any breach of his duty of prudence, diligence and loyalty during the notice period.
We concur with the Court’s holding the employee liable for the manner which he elected to rescind and for failing to meet the duties incumbent upon him throughout the notice period.
