In Williamson v Brandt Tractor Inc. 2026 ONCA 272 (“Williamson“), the Court of Appeal clarified that in wrongful dismissal claims, the employer bears the burden of establishing that the plaintiff has failed to pursue comparable employment but also that such employment was available. The Court also confirmed that all income earned during the notice period is to be deducted as mitigation, even if earned in a lower paying position. The decision can be found here.
The trial decision concerned a 56-year-old plaintiff who was dismissed for cause after 18 years of service. The trial judge found that the defendant employer failed to establish just cause and awarded damages based on a 17-month notice period. The plaintiff argued that the earnings from his new job should not be deducted from his damages as the new job was lower paying and therefore not comparable. The trial judge agreed.
On appeal, the appellant employer argued that the trial judge erred in finding that the plaintiff properly mitigated his damages, as he did not seek a comparable position. The employer also argued that the trial judge erred in failing to deduct income earned during the notice period. The Court of Appeal rejected the employer’s argument on mitigation efforts, holding that the employer bears the burden of establishing that the employee failed to pursue comparable employment but also that comparable employment was available. The employee’s decision not to seek comparable employment did not relieve the employer of its burden.
However, the Court overturned the trial judge’s decision on deducting mitigation income. The Court confirmed that there is no authority in Ontario for the proposition that earnings coming from an inferior position are not deductible in mitigation. All employment income earned during the notice period must be treated as mitigation of loss and deducted from damages awarded.
This decision clarifies that employers bear the onus of proving both the availability of comparable employment and that the employee failed to pursue it. Employers may meet this burden by regularly searching for comparable job postings and sharing them with plaintiff employees. However, employers can be assured that all mitigation income earned by employees during the notice period will be deducted from damages. Employers should keep these principles in mind when defending wrongful dismissal actions. Our employment group is available to assist employers in navigating these claims, as well as others.
This publication is intended for general information purposes only and should not be relied upon as legal advice.
