Case In Point

Court Confirms Mitigation Efforts Do Not Extend Limitation Period

Case In Point

Court Confirms Mitigation Efforts Do Not Extend Limitation Period

Date: September 22, 2021

In Andrew Scott v. Community Living Temiskaming South, 2021 ONSC 5402, Justice Koke confirmed the importance of bringing employment-related legal claims to the right forum and confirmed that, in the context of claims for constructive dismissal, remaining with your employer to mitigate your damages will not extend the two year limitations period for commencing an action.  

Initially the plaintiff was a unionized employee, and bound by a collective agreement between the defendant employer and his union. In March of 2015, the plaintiff accepted a non-union supervisor position and worked in the non-union supervisor position until the defendant returned him back to the unionized position on March 27, 2017.

After the plaintiff returned to the unionized position, he was given a notice of indefinite layoff on April 25, 2017, a layoff that became effective July 1, 2017. Nearly two years later, on April 4, 2019, the plaintiff commenced an action for wrongful dismissal against the defendant, alleging that he was wrongfully dismissed on July 1, 2017.

The plaintiff subsequently amended his statement of claim to allege that he was constructively dismissed when he was transferred from his non-union supervisory role back to the bargaining unit on March 27, 2017.

The defendant brought a motion to dismiss the action on the basis that a court had no jurisdiction over the dismissal of a unionized employee and that exclusive jurisdiction over the claim was with a labour arbitrator under the collective agreement.

The defendant also argued that the allegations of constructive dismissal were untimely, as the alleged constructive dismissal occurred two years before the plaintiff brought his first court action and around three years before he amended his claim to include the constructive dismissal allegations. In accordance with the Limitations Act, 2002, a plaintiff has two years after they discover their loss to commence an action.

With respect to the limitation argument advanced by the defendant, the plaintiff’s admission that not only did he discover his constructive dismissal claim on March 27, 2017, but that he also took efforts to mitigate his damages by accepting the unionized position, was fatal to his claim. Justice Koke found that the plaintiff’s mitigation efforts could not extend the limitations period, as there was no bar to the plaintiff mitigating his loss while simultaneously commencing an action for wrongful dismissal. As the plaintiff brought his claim for constructive dismissal more than two years after the alleged constructive dismissal, Justice Koke found that the constructive dismissal claim was untimely.

Turning to the plaintiff’s wrongful dismissal claim, Justice Koke noted that courts have repeatedly affirmed their lack of jurisdiction over claims from employees in unionized workplaces. Furthermore, Justice Koke found that it was clear that the plaintiff was in the union after he was transferred back from the supervisory position and that even if there was a legitimate dispute about whether the plaintiff was a member of a union when he was dismissed, a labour arbitrator, and not the courts, had jurisdiction to determine the status of the employee.

As such, Justice Koke held that while the plaintiff’s wrongful dismissal claim was timely, the Court had no jurisdiction over the claim, as exclusive jurisdiction was with a labour arbitrator.

This case again confirms that courts generally lack jurisdiction over claims brought by unionized employees, and that the proper forum for a dismissed unionized employee to challenge their dismissal is a labour arbitrator. Furthermore, Justice Koke’s decision reinforces that the limitations period commences when a claim is discovered and that remaining with your employer to mitigate your damages does not extend the limitations period.

The employer in this case was represented by Hicks Morley’s Ed O’Dwyer.

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