The Duty to Mitigate

 The duty to mitigate is a common law principle that requires an employee to minimize their losses, or the damage they have suffered, after being terminated. This means that an employee must make reasonable attempts to find a new job.

An employee does not need to apply for and accept just any other job. The employee is only required to apply for jobs which are comparable to that from which they were terminated. When determining whether a position is comparable, the Court of Appeal has found that the Courts should consider whether the new position is comparable to the previous position in terms of status, hours, and remuneration. Employees are not expected to accept work that is not comparable to their previous position: for example, an office manager does not need to accept a position as a server in a restaurant.

Importantly, Courts have recognized that employees need time to collect themselves after learning their employment has been terminated. Accordingly, employees do not need to begin their job search efforts immediately upon termination. It is reasonable to take a few weeks to adjust to the shock of termination, as well as time to prepare job application materials.

Why does mitigation matter?

When an employee is terminated, they are entitled to notice under the Employment Standards Act or the common law (click HERE to read more about the difference between both types of notice). The purpose of the notice period is to give an employee time to find a new job. An employee thus has a duty to look for a new job during that period. This becomes an issue when the employee argues that their employer did not give them enough notice.

Importantly, if an employee does not mitigate their damages, the notice period remains the same, but their employer may be able to argue a reduction in the damages they will be ordered to pay.

It is the employer’s burden to prove that the employee failed to mitigate

It is up to the employer to prove that the employee did not mitigate. This is a difficult bar to meet. The employer must prove two things. First, the employer must demonstrate that the employee’s efforts to mitigate were unreasonable in all aspects. The employer must then show that had the employee acted reasonably, they would have secured a comparable position. Employers are held to a very high standard, particularly at the second stage of this analysis.

How can an employee show that they have mitigated their damages?

Employers and the Courts alike will require that recently terminated employees take reasonable steps to secure comparable employment. Employees should keep records of their job search to demonstrate that they have mitigated their damages. The employee may need to show the jobs that were available at the time on job search engines such as LinkedIn or Indeed.com, the positions they applied for, and whether they were invited for an interview. A detailed job search log will make it easier for an employee to demonstrate their attempts to mitigate.

In most cases, employers and employees attempt to "settle" their case before the duty to mitigate has been fully exhausted. if you have questions about your responsibilities during a proposed notice period, you should contact one of our employment lawyers for advice