Arbitrator rules on damages to be awarded to discharged grievor, in rare circumstances where just cause found to be lacking, but reinstatement not appropriate

In a recent decision, an arbitrator appointed under the Canada Labour Code addressed the issue of the monetary compensation payable to a discharged grievor, in the unusual situation where the arbitrator finds that although the employer did not have just cause for dismissal, reinstatement would not be appropriate.

The case involved an electronics technician who was dismissed for alleged insubordination. The arbitrator found that despite his past disciplinary record, the employee’s misconduct was not sufficiently serious to justify his dismissal. However, the arbitrator ruled that the employment relationship between the grievor and the employer had deteriorated to such an extent that reinstatement was not appropriate.

Turning to the issue of damages, the arbitrator declined to award the grievor compensation based upon the common law or statutory entitlements of a non-union worker, and ruled that a different approach was required in the unionized sector. He found that the grievor was entitled to the following:

• a retiring allowance of 1.5 months’ salary for each year of service;
• a top-up of 15% as compensation for loss of fringe benefits;
• severance pay in accordance with the Canada Labour Code; and
• interest on the monetary award at 2.5% per annum.

The Union’s claims for a training allowance, personal debt reimbursement and damages for pain and suffering were denied.

Nav Canada and IBEW, Local 2822, unreported, January 6, 2004 (Kuttner).