1. Anatomy of a Failed Termination Process
2012 Vancouver Employment & Labour Law Conference
Allen Soltan and Justina Driedger (Summer Articled Student)

2. Review of Vernon v. British Columbia (Liquor Distribution
Branch), 2012 BC Supreme Court [http://www.courts.gov.bc.ca/jdb-
txt/SC/12/01/2012BCSC0133.htm]
Overview
• Vernon had worked for LDB for 30 years and was in a responsible
management position when dismissed.
• Known as “The Little General” for no nonsense management style
and insistence “that employees not slack off”.
• Vernon had received highly complimentary performance reviews
and no complaints had ever been made to her or to LDB.
• Employee under Vernon’s supervision complained about her.
• Complaint was investigated by LDB, and Vernon was subsequently
suspended without pay or benefits, and eventually dismissed
without severance.

3. Complaint against Vernon
• A unionized employee complained Vernon made her feel
“harassed, embarrassed, humiliated and uncomfortable at work”.
• Allegations:
• Vernon’s use of profane language “on a daily basis”
• “If you don’t tuck in your uniform I’ll kill you”
• Insults directed at complainant’s religion
• Union was asked for input on how complaint should be resolved; it
proposed a remedy which did not include termination of Vernon’s
employment.

4. Investigation of Complaint
• Investigator “should not have been put in charge of the
investigation”: she was also Vernon’s labour relations advisor and
Vernon had, only a few days before complaint received, confided in
her about problems she was having with complainant.
• The investigator was biased – she created a list of employees to
interview, many of whom she knew would have negative things to
say about Vernon.
• Interviews turned into interrogations, and defensiveness was
interpreted as lack of credibility.

5. • Vernon had no opportunity to respond to many of the allegations.
• Vernon was not ever told her job might be in jeopardy.
• Some specific complaints were not even looked into.
• Interview notes were inaccurate and inconsistent with final
recommendation.
• Investigator’s recommendations to her superiors were inaccurate
and misleading.
• e.g., stated Vernon was denying all allegations when in fact she
admitted to some.
• Court was highly critical of the process:

6. “[230] What the Recommendation Memo did not disclose was that Ms. Vernon
had been given no opportunity to respond to the matters raised in the
interviews, that she had agreed to stop swearing, was prepared to
apologize for her use of profanity and that the Complainant and the Union
were not seeking her dismissal. The Recommendation Memo made no
mention of her exemplary work reviews or the fact that in her 30 years of
employment there had never been a complaint made against her.
[231] Ms. van der Boom agreed at the conclusion of her cross-examination
that in the Recommendation Memo, instead of reporting objectively the
findings of the investigation, she was trying to prove that Ms. Vernon was
guilty of misconduct and should be terminated.

7. [255] The interview of Ms. Vernon was contrary to its intended purpose and
unfair in the extreme. Ms. Vernon thought she was meeting with her labour
relations advisor and area manager to discuss in an informal setting a
complaint that had been made against her. Instead, she was the subject of
an intense interrogation. The person who she had relied on as her labour
relations advisor was now her interrogator. Ms. Vernon was upset at the
meeting. She had good reason to be.
[256] {Ms. Vernon} was given a copy of the March 1 Letter, which contained
eight separate complaints, and asked for her immediate response. When
she denied certain allegations, she was met with the classic question,
“Why would the complainant lie?” It is of course a question that is
impossible to answer.

8. [260] Ms. van der Boom’s mistaken report had serious consequences.
Thereafter, all persons at the LDB involved in the investigation proceeded
on the basis that Ms. Vernon was denying all the allegations, when in fact
that was not so. …
[271] Ms. Vernon was a 30-year employee. She had been a store manager for
almost 12 years. In all those years there had never been a single
complaint made against her. Her performance reviews were glowing. …
The lack of any prior complaints against Ms. Vernon should have given
them cause to stop and reflect.

9. [274] Mr. Ferrara and Mr. Branham never appear to have considered the
actual complaints in the March 1 Letter. Outside of Ms. Vernon’s swearing
which was acknowledged, the balance of the complaints concerned Ms.
Vernon’s management style and her harsh corrections of the Complainant
on various occasions for alleged misdeeds. When they decided to
terminate Ms. Vernon, most of the specific complaints remained unproven.
[277] Ms. van der Boom testified that the Recommendation Memo was
supposed to be a balanced recommendation to the General Manager. It
was anything but.

10. The Termination Meeting
• Vernon was told she had engaged in “gross workplace
misconduct”, including bullying, harassing and intimidating
behaviour, and that her actions were “embarrassing and shameful”.
• LDB did not follow its own progressive disciplinary policy (warning,
re-training, a reprimand or transfer were not considered).
• LDB proposed a reference letter in exchange for Vernon’s
resignation.
• Vernon refused to resign and was suspended without pay.
• Recommendation to terminate Vernon was not prepared until one
month after her suspension.
• When her dismissal was finally approved, she was not notified for
another 10 days.

11. “[275] The meeting of April 19 was badly handled. Telling Ms. Vernon, after a
30-year exemplary career, that her actions are embarrassing and shameful
could not have been more insensitive. Ms. Vernon had given her entire
working life to the LDB and to treat her in such a manner was egregious,
shocking and unnecessary.
[276] Equally egregious was the LDB leaving Ms. Vernon in limbo from April 19
to May 31. Having rushed to terminate her employment, the LDB did not
take any steps to further the process between the meeting of April 19 and
the preparation of the Recommendation Memo on May 18. During that
time it was common knowledge throughout the LDB that Ms. Vernon had
been suspended. Mr. Chambers approved the dismissal on May 21, but
Ms. Vernon was not advised for a further 10 days … .”

12. • The Court found no cause for dismissal:
“While some of her conduct may have been inappropriate, she was
at all times trying to improve the performance of her employees. At
worst, some of her actions amounted to poor performance of the
management responsibilities she was attempting to fulfill.” (para
353)
“Ms. Vernon was a senior employee with an untarnished record.
She was entitled to a warning that her conduct was not
acceptable.” (para 354)

13. Result: A very expensive dismissal, bad public relations,
and damage to the individual reputations of the managers
involved.
• General damages
• $97,173.18 in lieu of 18 months’ notice (maximum notice
permissible under BC public sector employment legislation)
– plus –
• Pension contributions as if employed for 18 months.
• Special damages
• To replace MSP coverage, and to compensate for out-of-pocket
medical expenses, a job workshop and private counselling.

14. • Aggravated damages
• “The foundation of the claim for aggravated damages is the
manner of dismissal”.
• $35,000 awarded for an “unfair and unduly insensitive”
termination that “was devastating and caused her serious
harm”.
• Punitive damages
• $50,000 for offering a reference letter “as a carrot to resign”.
• Tactic was seen as an attempt to take advantage of her
vulnerability and avoid a lawsuit for wrongful termination.
• Costs Awarded to Plaintiff
• Total Damages Awarded – Approximately $200,000

15. Implications
• Everyone is responsible for what they say and do – every
employee of the LDB involved in Vernon’s dismissal was the
subject of strong criticism by the Court.
• “Resign or be fired” may not be a good strategy, except where very
high probability of proving cause.
• Aggravated and punitive damages are always possible in
employment cases.
• Providing compensation in lieu of notice in this case would have
been significantly less costly than trying to prove cause (always ask
if this is a “fight to be won or a problem to be solved?”).

16. APPENDIX – Damages Primer
• General damages: compensate breach of contract (failure to give
reasonable notice or pay in lieu of notice)
• “reasonable notice” depends on various factors
• 18-24 months is usually upper limit
• Special damages: compensate for various expenses caused by
breach of contract (i.e. out-of-pocket medical expenses, job
workshops, private counselling, cost of replacing employment
benefits)

17. Damages Primer – con’t
• Aggravated damages: compensatory in nature; implied
contractual term that employers will act in good faith in manner of
dismissal.
• Employee must show manner of dismissal caused mental
distress (over and above the normal distress and hurt feelings
resulting from dismissal itself) that was reasonably foreseeable.
• Bad Faith: being unfair, untruthful, misleading or unduly
insensitive.

18. Damages Primer – con’t
• Punitive damages: not compensatory; are directed towards
punishment; are rare and exceptional.
• Objectives are retribution, deterrence and denunciation.
• “Restricted to advertent wrongful acts that are so malicious and
outrageous that they are deserving of punishment on their
own.”