EMPLOYMENT MITIGATION LAWYER

Fixed-Term Employment Agreement

This duty exists even though they are the innocent party in the equation. Any benefit gained from complying with this duty to mitigate will be deducted from the damages that the employer must pay. The employee only has a duty to take reasonable steps to mitigate damages. The standard for mitigation is “reasonableness”, not “perfection”. According to the Alberta Court of Appeal:

“All the plaintiff need do is to make what at the time is an objectively reasonable decision; he or she need not make the best possible decision. In particular, the courts will not usually expect one faced with a breach of contract to take steps which are risky or unsavoury. The onus of proof is on the defendant … so any gap in the evidence accrues to the plaintiff’s benefit.”

The duty to mitigate is not an obligation owed by the dismissed employee to their former employer. Rather, the duty is owed to themselves, meaning that the former employee is entitled to seek a position that matches their level of skill and expertise. They do not have to take a lower paying job, even if that would please their former employer by reducing the amount of damages owing. Dismissed employees also are not often expected to seek or accept employment of a very different kind than what they previously did. Older employees are much less likely to be expected to relocate or accept employment far from home in order to successfully mitigate. The onus is on the employer who claims the former employee has breached the duty to mitigate. The employer must show:

• failure to mitigate on the employee’s part; and
• that the employee would have likely found another comparable position if one had been searched for.

Note that where an employee has become disabled during the reasonable notice period, they are still entitled to damages despite not being able to work (and therefore being unable to mitigate damages).

Contractual Exception to Mitigation Duty

The general principle that a wrongfully dismissed employee must mitigate their losses can be displaced by the terms of their contract of employment. For instance, a contractual provision providing that an employer will provide a certain specified amount of notice or payment in lieu of notice will displace the obligation to mitigate. Again, an employee working pursuant to a fixed-term contract without an enforceable termination provision limiting notice upon termination may be entitled to the balance of the contract without owing a duty to mitigate.