The duty to mitigate refers to a common law principle that requires an employee who has been wrongfully dismissed to take all reasonable steps to find comparable, alternative employment during the reasonable notice period. Should the employee obtain a new and comparable position during the common law reasonable notice period, earnings from the employees’ new job will be deducted from the amount owed by the employer as wrongful dismissal damages, since the employee has mitigated his/her damages.
Below we discuss some commonly asked questions regarding the duty to mitigate.
WHAT DOES THE DUTY TO MITIGATE REQUIRE?
The duty to mitigate requires making reasonable efforts to find a similar replacement job. Reasonable efforts may include:
- Updating your resume;
- Requesting employment references;
- Regularly checking job listing sites online such as LinkedIn, Indeed, Monster, and Workopolis;
- Regularly checking local newspapers for job listings;
- Contacting a Search Firm/Headhunter; and/or
- Applying for desirable employment positions.
Note that an employee’s duty to mitigate may be impacted by their personal circumstances. For example, if an employee becomes disabled following termination, they may not be required to engage in robust efforts to find new employment. Employees are required to make reasonable efforts to mitigate their damages, and what is considered reasonable may vary based on an employee’s particular circumstances post-termination.
WHAT INFORMATION ABOUT MY MITIGATION EFFORTS SHOULD I RETAIN?
In the event that an employee’s mitigation efforts are challenged, it is advisable for employees to keep a detailed record of their mitigation efforts. Information pertaining to mitigation efforts that should be recorded can include the following:
- Positions you applied for (i.e., marking down the name of the employer, your date of application, and the position sought);
- The dates and websites you’ve searched for job postings;
- The dates and times of any telephone calls you made to find work; and
- The dates and times of any interviews you had during your job search.
WHAT HAPPENS IF I DON’T LOOK FOR A NEW JOB?
An employer that alleges that an employee has failed to mitigate their damages holds the burden of proof. This means that they must prove that there were comparable employment opportunities available to the employee during the reasonable notice period and that the employee did not make reasonable efforts to obtain one of these employment opportunities. Where an employer proves that a former employee failed to mitigate their damages, or took inadequate steps to mitigate their damages, a court may either:
- Find that the employee is not entitled to any damages; or
- Reduce the employee’s damages based on the estimated period in which the employee failed to mitigate. This can include determining the date by which the employee should have secured alternative employment.
RETURNING TO WORK WITH THE PREVIOUS EMPLOYER
Employees may be expected to accept temporary re-employment with their previous employer as an effort to mitigate their damages, but this determination is evaluated on a case-by-case basis. The factors that may lead to an employee having the duty to return to work are as follows:
- Where the salary offered is the same as it was prior to termination;
- Where the conditions of employment have not substantially changed;
- Where the work is not demeaning; and
- Where the personal relationships are not acrimonious.
Generally, an employee does not have to accept an offer to return to work if there is an atmosphere of hostility, embarrassment, or humiliation; however, the question to be answered in the case-by-case determination is whether a reasonable person in the employee’s position would perceive it to be that way.
LIMITATION ON THE DUTY TO MITIGATE
If an employee is unsure about whether they need to take a particular action in order to mitigate their damages, they should seek out legal advice.
The duty to mitigate does not apply to the minimums set out by the Employment Standards Act, 2000 as it only applies to the common law reasonable notice period. Other limitations on the duty to mitigate are as follows:
- Generally, an employee who has had their employment terminated has the duty to search for reasonably comparable employment and to accept that employment if it becomes available. However, if the available employment is substantially different from the employee’s former role, the employee may not be required to accept it.
- Generally, an employee who had a pre-existing secondary source of income is not required to deduct the money earned by the secondary source of income from the wrongful dismissal damages. However, if the employee has subsequently increased their earning potential due to the loss of their primary employment, they may be required to deduct surplus earnings from their wrongful dismissal damages.
- Generally, employees on a fixed-term contract are not required to mitigate their damages unless expressly set out in the employment agreement. This is because an employer is attempting to contract out of the common law reasonable notice period and replace it with a predetermined contracted amount. As a result, the employee should be entitled to the predetermined amount set out in the contractual agreement without the duty to mitigate (unless explicitly set out in the contract).
CONTACT SULTAN LAWYERS IN TORONTO FOR ADVICE FOR EMPLOYEES
If you have been recently terminated, require more information, or have any questions relating to the duty to mitigate, please contact the Toronto employment lawyers, Sultan Lawyers, at (416) 214-5111 or here.
