Entering into a new employment relationship can be an exciting but stressful decision. Employees may be leaving a secure job with another employer, they may be relocating, and they may be making considerable financial decisions based on the new opportunity. There is often a lot of planning involved. What many may never plan for is the possibility of losing the job before it even starts. Unfortunately, it happens.
It is common knowledge that an employee is entitled to a severance if they are let go during the term of their employment. However, what most fail to realize is that a severance may be payable if a contract is terminated before the employee even steps foot on the job.
This is precisely the lesson that was learned by the employer in the case of Kim v BT Express Freight Systems, 2020 317 A.C.W.S. (3d) 255. In that case, after signing back an employment contract accepting a new position with BT Express, Mr. Kim notified his then-current employer that he has found a new job and was resigning. However, only 2 days before he was scheduled to start his new position at BT Express, Mr. Kim found out that they no longer had a job for him. BT Express withdrew the offer to employ him, and apologized to him for the inconvenience. Unfortunately for Mr. Kim, the inconvenience was significant: the company he was working for had already found his replacement. He was left completely jobless.
The court determined that Mr. Kim was entitled to a considerable severance from BT Express, despite the fact that he never actually performed any work. In making this determination, the court was focused on the terms and conditions of the written employment contract between Mr. Kim and BT Express. He was awarded damages for the loss of the BT Express opportunity because the contract he executed did not provide the company with the ability to withdraw, without damages.
The outcome for Mr. Kim would have been much different had he entered into a written contract with BT Express that included specific wording making his employment conditional. For example, had the contract specifically allowed BT Express to withdraw if it was not satisfied with the results of a reference or background check, Mr. Kim would have received nothing despite being left jobless.
At Singh Lamarche LLP, we are frequently called upon by both employees and employers to help them navigate all aspects of the employment relationship, often before it has even started. We pride ourselves in ensuring that our clients’ best interests are always protected. Contact us today for a free consultation.