Toronto Employment and Labour Law Blog: Damages in Employment Law

For many years damages in employment-related cases were limited to actual provable loss. In most cases, such a limited loss seldom justified litigation against the employer.

That was until Hugo Pilon walked into my law office in Toronto in 1979. Mr. Pilon had been fired for cause by the Peugeot Motor Company where he had been a service manager for seventeen years. He was fired on a Friday and was rehired at an equivalent salary by the end of the following week by a competing motor company. Mr. Pilon wanted to sue Peugeot for damages. Hugo Pilon was fired for cause at 57 years of age. He was not informed of the reason for his firing. His company car was taken from him and he was told to leave the premises and take public transport home. On his trip home he suffered, what he believed was a heart attack. He was rushed to the nearest hospital where he spent three days.

Since he was re-employed by the end of the week I explained to Hugo that his damages were restricted to one week's pay and nothing more. He complained that this was unfair since he had suffered angina and severe stress as a result of the harsh manner of his firing without any explanation for the so-called "cause".  He wanted to "sue the bastards"

The case was tried before Mr.Justice Galligan who awarded Pilon 12 months notice [which he had mitigated] and damages for the mental distress that he had suffered as a result of the "callous,  sudden and arbitrary manner" of his dismissal.  The floodgates to damages in employment cases were flung open. This case, in large part, created the practice of employment law.  Damages for mental distress constituted a significant bonus to wrongfully terminated employees and a substantial increase in the cost of terminations for employers. Hugo Pilon was the father of employment damages beyond the contract. Those damages have been expanding ever since to the benefit of employees and the chagrin of employers.

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