Court Awards Damages for Improper Termination – Thompson v Revolution Resource Recovery

Thompson v Revolution Resource Recovery Inc. Overview

Facts

• Ms. Thompson was employed at Revolution for 3 years and 4 months as a key accounts manager. On September 27, 2019 her employment was terminated without cause.
• Ms. Thompson’s employment began in June 2016, under a set of documents that established her compensation scheme, including commissions, and that to receive commission she must be an “active and current employee” at the time payment was due. Termination or a lay off would render an employee ineligible.
• Ms. Thompson was the only key account manager, and her position involved managing accounts, but not other employees.
• In May 2019, Revolution broached the subject of transitioning Ms. Thompson’s role more to new business development, but she said she had not been hired as a new business sales representative, and did not want to move into that role.
• Later in May 2019, Ms. Thompson was sent a letter by her direct manager explaining that new sales were lacking, and without significant effort on her part, her department would need to be restructured.
• About midway through 2019, Ms. Thompson began having increased care responsibilities for her ailing mother. As a result, she missed some days of work.
• In early September, Revolution did not direct any more existing customer account matters to Ms. Thompson, and her commissions decreased accordingly.
• A meeting was scheduled for September 27, 2019, but Ms. Thompson did not make the meeting due to falling ill. When she called later in the day to say she could in fact come in for a meeting, she was told to check her email; there, she found a termination notice advising her she was permanently laid off due to her position being declared redundant.
• The notice stated she would receive all wages and commissions to that date along with four weeks severance, and by accepting the payment, she released any claims against Revolution. Ms. Thompson repeatedly refused to agree to or sign any such release.
• On September 30, Ms. Thompson wrote a reply letter stating she was owed more severance as well as unpaid bonuses based on the ‘stats’ of customer re-signing she had tracked and prepared for the meeting she was supposed to have. She requested to be paid her statutory entitlements by way of direct deposit.
• She had also been provided with a severance cheque by Revolution, which she initially refused to deposit, but did deposit midway through October 2019.
• Revolution also sent her a cease and desist letter, alleging that Ms. Thompson had breached a restrictive agreement by failing to return all confidential company information, referring to the materials she had prepared for her meeting.

Why This Decision Is Important

Revolution argued that by depositing the cheque, Ms. Thompson had accepted their offer and released them from all claims. The court found that Ms. Thompson’s repeated refusal to release Revolution from any claims meant that she did not accept their offer, and had not waived her right to sue.

Law

Where a creditor negotiates with a cheque delivered on condition of full settlement, accepting receipt may be evidence of satisfaction, but it is not conclusive evidence and no presumption of the kind should be drawn. What governs is the intention of the recipient, and whether it is expressly communicated. Express acceptance, beyond mere receipt of payment, is required for part performance of an obligation to extinguish the obligation.¹

Absent an enforceable contractual provision to the contrary, an employer must give an employee reasonable notice of termination. The purpose of reasonable notice is to provide the employee with a fair opportunity to obtain similar or comparable re-employment.² The non-exhaustive list of factors to use when deciding the appropriate notice period include: the character of the employment, the length of service of the employee, the age of the employee, and the availability of similar employment.

Although general skills in a position may be transferable, a specialized field of knowledge may make a longer notice period more appropriate.³

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Ms. Thompson did not give Revolution express acceptance that the cheque would satisfy their obligation to pay her severance. In fact, she expressly refused to accept their offer, and considered herself legally entitled to more notice.

The court found that Ms. Thompson’s position was primarily knowledge-based in an industry-specific manner, such that her skills were not overly general and highly transferrable. Ms. Thompson had extensive waste management experience and in performing her work, she relied on an in-depth understanding of the variety of services available and how they could be offered to suit particular clients.

Based on the factors above, the court decided that a six-month notice period was appropriate. But, given that Ms. Thompson was not as diligent in searching for new employment as she should have been, this was reduced to five months.

Revolution then tried to argue that commission should not be included in the reasonable notice period, because there was no guarantee that Ms. Thompson would have earned it.

The court found otherwise, given Ms. Thompson’s track record of earning commission every month of her employment. Further, the court found that the commission clause in the employment contract did not exempt her from receiving commission; if she had been given proper working notice, she would have been working during the notice period, and so her contract would not have been terminated during that time.

Outcome

Ms. Thompson received pay in lieu for her five month notice period, including calculated commission. She also sought $50,000 in punitive damages for Revolution’s conduct during her termination and the period following.

The court agreed that the cease and desist letter Revolution sent was aggressive, but sending it was neither high-handed nor reprehensible. However, the court did find that Ms. Thompson was entitled to punitive damages in respect of Revolution’s conduct in relation to the cheque they issued and their failure to provide her final payment in accordance with the Employment Standards Act.

Ms. Thompson was awarded $25,000 in punitive damages.

Key Takeaways

• Employers in British Columbia are required, under the Employment Standards Act, to provide terminated employees with their accrued wages, including any statutory termination pay, within 48 hours of their final day of work. The payments must be made unconditionally, and cannot be contingent on anything, like the “release” above.
• If an employer realizes they have inadvertently not complied with the ESA, they have to address that promptly.
• When there is a reasonable basis for it, an employer can issue a cease-and-desist letter in regard to confidential information and an employee’s use of it, and such a letter will not attract punitive damages.

References

Thompson v Revolution Resource Recovery Inc, 2025 BCSC 8 (CanLII)
https://canlii.ca/t/k8k7v

1. IBI Group v LeFevre & Company Property Agents Ltd, 2004 BCSC 298 ↩︎
2. Ansari v BC Hydro & Power Auth, 1986 CanLII 1023 (BCSC); Ostrow v Abacus Management Corporation Mergers and Acquisitions, 2014 BCSC 938 (CanLII) ↩︎
3. Moore v Instow Enterprises Ltd, 2021 BCSC 930 ↩︎

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