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The Ontario Superior Court recently awarded an employee damages of over $500,000 for abusive treatment by a supervisor that led to permanent damage to the employee’s health and career. But the award was not based on wrongful dismissal. Instead, it was based on the tortious conduct of the supervisor and vicarious liability of the employer.

The decision is part of an increasing trend where creative counsel are seeking damages against employers for tortious liability as opposed to basing employee claims in contract.

In Piresferrerira v. Ayotte and Bell Mobility, [2008] O.J. No. 5187, the employee had been an account manager with Bell Mobility since 1996 and was 60 years old at termination. During her tenure, she had excellent performance reviews until 2004. In 2004, factors outside of her control caused her sales to decrease. However, her supervisor, who had an aggressive and intimidating management style (frequently yelling and swearing at employees), blamed the employee for the decrease in sales. The supervisor became increasingly annoyed with the employee for what he viewed as her failure to implement his suggestions to improve her sales and increasingly yelled and swore at the employee to get her to accept his views and change her conduct.

While the employee’s sales improved in 2005, the relationship with the supervisor did not and the situation came to a head. After the employee unsuccessfully tried to get customers to attend a technical support meeting, the supervisor began yelling and berating the employee that she was failure in the presence of a visiting marketing executive.

When the employee later tried to show the supervisor an e-mail chain demonstrating her efforts to arrange the meeting, the supervisor assaulted her by pushing the employee with sufficient force to propel her nearly a foot, forcing the employee to balance herself against a filing cabinet. After the employee followed the supervisor to his office and tried again to explain the situation, the supervisor yelled at her to get out and advised he would be placing her on probation.

The employee was upset and felt violated following the altercation. She took a few days off. When she returned to the office, rather than apologize for his conduct, the supervisor placed the employee on a performance improvement plan that required her to report daily on her activities to the supervisor and hold bi-weekly individual meetings with him. The employee was warned that if her performance did not improve, further disciplinary action up to and including dismissal would result.

The employee never returned to work or any other employment following this incident. As her condition worsened, she was ultimately diagnosed with post-traumatic stress disorder and major depressive disorder. Her personal and social life deteriorated. A formal complaint to human resources against her supervisor only resulted in the supervisor receiving a written warning.

The court found that the employee had been subjected to tortious conduct, including assault, intentional and negligent infliction of emotional distress and mental suffering, all in addition to being constructively dismissed due to the supervisor’s actions.

The employer, Bell Mobility, was held to be vicariously responsible for the supervisor’s tortious conduct. The court awarded $500,955 in damages: $45,000 for general damages and $450,832 for loss of past and future income until age 65, as well as special damages of $5,123 for the cost of therapy and medications.

The court also quantified the employee’s damages for constructive dismissal and moral damages to be in the amount of $132,855, but declined to award them since it concluded that doing so would amount to double recovery. No deduction was made for the long-term disability benefits the employee received since she had paid into those benefits, albeit indirectly.

The decision in Piresferrerira and a similar decision in Sulz v. Canada, [2006] B.C.J. No. 121 (where the employee was awarded $950,000 in damages for tortious conduct by the supervisor and employer) graphically illustrate that claims by employees for tortious conduct in the right circumstances can be far more valuable than traditional claims of wrongful or constructive dismissal that are normally pursued on an employee’s behalf.

This will be particularly true where employees suffer lasting damage to their health and it can be demonstrated that their future career and earning prospects will be adversely affected as result. In such circumstances, an employee’s losses at tort will not be limited to the duration of a notice period as it normally would be if the claim was solely pursued on the basis of breach of contract.

When meeting with employees and assessing their claims, counsel should not limit their review by only looking at claims through the traditional lens of contract law. Rather, a careful review of the employee’s circumstances is necessary to ensure that in pursuing wrongful dismissal claims, counsel are not overlooking possible significant tort claims against employers and third parties who may have been involved in the employee’s termination.

Steve Levitt practises employment law with Nelligan O’Brien Payne LLP, a full-service law firm in Ottawa.