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Wrongful Dismissal Decision Based on “Exceptional Circumstances” Upheld by Ontario Court of Appeal


The Ontario Court of Appeal recently upheld a judgment in favour of a wrongfully dismissed employee for damages based on 27 months of pay in lieu of reasonable notice due to exceptional circumstances.

Gregory Milwid worked for IBM for 38 years, including 16 years of service in South Africa before moving to Canada. He was 62 years old when his employment was terminated without cause in May 2020, soon after the onset of the COVID-19 pandemic. Mr. Milwid held a managerial position with IBM.

At common law an employee is entitled to reasonable notice of termination without cause, or pay in lieu of providing reasonable notice. A wrongful dismissal occurs where an employer fails to give a terminated employee the correct period of advance notice of termination required by common law (either as a period of time or as pay in lieu of notice). A Court determines the reasonable notice period by weighing certain factors including the employee’s age, duration of employment, character of employment, and the availability of suitable alternative employment at the time of the employee’s termination – together these are known as the “Bardal” factors.

In lengthy written reasons granting Mr. Milwid’s motion for summary judgment, the lower court Judge held that Milwid was entitled to damages based on a reasonable notice period of 27 months. The motion Judge found that there were “exceptional circumstances” which warranted an award in excess of the 24-month upper limit on reasonable notice periods typically recognized by Ontario courts. The motion Judge held that the Bardal factors justified an award of 26 months and encompassed Mr. Milwid’s “…age, lengthy service, the exclusivity of his employment with the defendant, the character of his employment and specialized nature of his work.” The motion Judge also found that Mr. Milwid’s termination near the start of the pandemic while Ontario was in a state of emergency was an additional exceptional circumstance warranting one more month of notice, bringing the total to 27 months.

In the Ontario Court of Appeal, IBM challenged the motion Judge’s conclusion that there were exceptional circumstances to support a reasonable notice period over 24 months (among other things), because the reasons cited the usual Bardal factors – which by definition are not exceptional. The Ontario Court of Appeal noted that it was not improper to rely on the unique constellation of Bardal factors, along with other exceptional circumstances, to find a notice period that exceeds 24 months. In this case, there was evidence on the record to show that Mr. Milwid’s skills were not easily transferrable because they were specific to IBM’s products. This, the Court of Appeal held, is an exceptional circumstance that is not one of the Bardal factors and could support a notice period exceeding 24 months. The Court of Appeal also affirmed that the pandemic was a “truly exceptional circumstance” and there was no basis to interfere with that finding. The 27 month reasonable notice period was upheld.

Reference: Milwid v. IBM Canada Ltd., 2023 ONCA 702 (CanLII)