 | The law will not generally force an employer to keep an
employee if the employer no longer wants to employ that person.
Consequently, an employee may be terminated at any time with or
without "just cause". This principle preserves an employer's right
to hire, and fire, whom and when they choose, subject to the legal
rights of employees to claim monetary damages for being terminated
under the applicable law; |
| "Just cause" is essentially a fair reason for firing someone.
What is a fair reason will generally depend on the duties of the
employee, and what the employer alleges is the reason for the
termination. There is no broad rule of what is just cause - it
must be determined on the facts of each case. |
| There are some cases where just cause is presumed and the
allegation that there was just cause must be rebutted by the
employee, such as where drugs or alcohol are involved in a
workplace accident. |
| If an employee is terminated with just cause they are not
entitled to a "notice period" or "severance". "Notice period" is a
period of time, after notice of termination has been given to the
employee, where the employee may be permitted to keep working, and
is paid, pending their last day of work. Often employers chose not
to allow the employee to remain on the job waiting for their last
day, but rather chose to pay the employee an amount equal to the
wages for that period of time and ask the person to leave
immediately. The amount of money pain in lieu of the notice period
is part of "severance" |
| What is the appropriate notice period, or severance pay in
lieu of the notice period, will depend on such factors as minimum
requirements under legislation such as the B.C. Employment
Standards Act or Canada Labour Code, the type of work, the level
of seniority and age of the employee, and likelihood of
reemployment. |
| If an employee is terminated without just cause, they are
entitled to either a notice period or severance pay in lieu of the
notice period. Where an employee is terminated without just cause,
they may also be entitled to damages for wrongful dismissal. |
| Damages for wrongful dismissal may exceed the amount of
severance the employee is entitled to depending on the conduct of
the employer and the circumstances of the employee. |
| If the employer terminates the employee in a manner that is
callous, high-handed, or objectively insensitive, damages for
wrongful dismissal can be as much as equal to 24 months of the
employee's regular salary. |
Important Distinctions:
There are three important distinctions that must be considered in
this discussion of a seaman's claim for severance or wrongful
dismissal damages: the first is the difference between a contractor
and an employee; the second is the difference between union and
non-union workers; and the third is the difference between federal
employment law and provincial employment law. It is only with these
three distinctions in mind that we come to the clear, and
worthwhile, understanding of a seaman's right to severance pay and
damages for wrongful dismissal.
The difference between an employee and a contractor is important to
this discussion because it is only an employee that has a right to
severance pay or damages for wrongful dismissal. A contractor's
rights are limited to the benefits of the particular contract
between themselves and the hirer - the contractor cannot rely on
provincial or federal employment law to imply such privileges as
minimum pay or working conditions, severance pay or damages for
wrongful dismissal. A contractor takes certain benefits, such as
greater tax advantages for expenses, but loses privileges that a
true employee has. Whether a worker is a contractor or an employee
will depend on the facts in each case, such as who supplies the
tools, who dictates how the work is done, whether the pay is
contingent on success, and whether deductions for taxes are made by
the hirer.
Importantly, while this discussion of severance and wrongful
dismissal relates only to true employees, as it is only true
employees that have the benefit of severance or damages for wrongful
dismissal, a contractor that earns their pay working aboard a vessel
likely has a maritime lien for wages regardless of their status as a
non-employee.
The difference between union and non-union employees is also
important because the right of an employee to claim for severance
and damages for wrongful dismissal will, in the case of a union
employee, be dictated in part by a collective bargaining agreement
("CBA") between the union and employer, whereas for a non-union
employee such claims will not. Because I cannot appreciate how the
terms of any particular CBA dictate a claim for severance without
viewing that agreement, this discussion relates only to nonunionized
employees. Regardless, claims for unpaid wages of union employee
working aboard a vessel is a claim that generally gives rise to a
maritime lien for wages in the same way that claim by a non-union
employee does. A significant difference however is that the union
will generally work with the employer to ensure the employer's
vessel is not arrested and sold to satisfy the claim.
The third distinction is that between provincial and federal statute
law and common law. The rights of many of the non-marine employees
in British Columbia are governed by the B.C. Employment Standards
Act ("ESA"), being a provincial statute, and provincial common law,
being law developed through consecutive decisions of the courts of
law of British Columbia. The provincial ESA and the provincial
common law govern issues such as notice periods and severance pay,
with the general rule that the common law provides more generous
awards of severance than does the statute. Under the Constitution
Act of Canada however, provincial law does not apply to matters that
are in substance matters of "navigation and shipping" - this is
reserved for Federal law.
Seaman's wages has traditionally been regarded as being within the
jurisdiction of navigation and shipping. The Federal law that
applies is the Canada Labour Code and federal common law. There are
however some possible exceptions to this rule, particularly that
some provincial employment law may apply to ferries that trade
entirely within the province.
Severance for Mariners
Where a claim is brought against an employer in British Columbia
for work completed on a typical vessel trading within and outside of
B.C. waters, the claim will be governed by Canadian Maritime Law,
including the federal Labour Code and the common law. While the
Labour Code specifically sets out the amount of severance an
employee is entitled to, the common law is generally more generous.
While no specific rule of law can be stated, employees of higher
seniority, older employees with less chance of re-employment, and
employees who were lured from other employers to commence work at
the employer which is letting the m go, are generally entitled to
significantly more severance than provided for in the Labour Code.
For example, while the ESA provides that the employee is entitled
to: 2 weeks of notice (or severance pay in lieu of) after one year
of service, three weeks severance after three consecutive years of
service, and one additional week for each year of service thereafter
to a maximum of 8 weeks, The Labour Code on the other hand provides
that the employee is entitled to the greater of 5 days of notice, or
two days per year for every year of continuous service, but only
after the employee has served 12 months of initial service.
In both cases, the common law is typically significantly more
generous. However, in order to take advantage of the common law's
more generous approach to severance a seaman must either sue the
employer, or educate the employer of what the common law is and
therefore what the likely result of suing would be. In either case,
if the seaman intends on taking advantage of the right to arrest the
vessel pursuant to their maritime lien for wages, the greatest of
care must be taken in not unnecessarily handicapping the business of
the vessel.
Damages for Wrongful Dismissal:
Like a claim for severance, a claim for wrongful dismissal of an
employee gives rise to a maritime lien for seaman's wages. As
discussed in last month's "Advocate", this claim ranks in priority
to most other claims against a vessel , including common claims such
as a prior registered mortgage, and a claim by a repairer (not in
possession of the vessel) for monies owing.
Damages for wrongful dismissal are not as readily quantified as
severance because the degree of damages depends on the particular
circumstances of what preceded the termination, and how the
termination was carried out. Again, there is no firm rule of what
the appropriate amount of damages is, however, damages will
generally be greater where the conduct of the employer is without
reason, is insensitive, or is vindictive.
It is important for an employer or vessel owner to appreciate that,
because an employer is liable for the acts of its employees who are
tasked with terminating other employees, the employer will be liable
for damages where the employee doing the firing acts wrongfully.
In other words, where an employee takes a personal issue with the
other employee in fulfilling their role in firing that other
employee, damages for any inappropriate conduct will he visited on
the employer and not on the employee who acted poorly in the firing
process. These greater damages result in an increased claim against
the vessel as the seaman's claim for wrongful dismissal forms a lien
against the vessel. To this end, the firing process of a seaman
becomes relevant to ensuring the security of a vessel from claims.
Darren Williams is a Barrister and Solicitor (Lawyer) specializing in Admiralty
Law, which has jurisdiction over maritime matters. Darren has worked
extensively on the water as well as in the courtroom. He is a
Barrister & Solicitor based out of Victoria, British Columbia,
Canada, practicing at the Law Firm of "Williams & Company".
On this webpage, he brings us timely and relevant articles on
the legal aspects of being a Marine Engineer in today's world.
Although the articles have a predominately Canadian flavour, we are
sure you will find his legal point of view enlightening where ever
you ship sails. Darren has also published other legal articles on
general admiralty law, view them all at the
Williams & Company website. You can reach Darren for question or
comment by phone at 250-478-9928 or
by email.
