The Blog

Recent cases highlight an important difference between provinces in the treatment of mitigation income after the breach of a fixed-term employment contract. Ontario’s jurisprudence can result in a windfall to some employees, where cases provide for damages to the end of the contract’s term without deduction for income earned in alternative employment. But courts outside Ontario are registering disagreement.

A recent case demonstrates the challenge employers face when seeking reduced damages for an employee’s inadequate attempts to mitigate. The plaintiff in Hucsko v. A.O. Smith Enterprises, 2020 ONSC 1346, made no efforts to find alternative employment after termination, but the Court opted not to reduce his damages because the defendant company did not lead sufficient evidence of the availability of comparable jobs.

A recent case weighs in on an interesting puzzle in the law of wrongful dismissal damages: How to factor mitigation income into the award when the employee gets new work at significantly higher pay. Kideckel v. Gard-X Automotive Refinish Inc. suggests the jurisprudence is consolidating around a principled approach, holding that an employer shouldn’t get retroactive credit for an employee’s surplus mitigation income.