Top court to address whether pension benefits should be deducted when assessing wrongful dismissal damages
The Supreme Court of Canada announced on April 5, 2012 that it would be hearing the appeal in IBM Canada Limited v. Richard Waterman.
This case, from BC, concerns whether pension benefits from an employer funded plan should be deducted from wrongful dismissal damages.
The Supreme Court of Canada's summary of the decision is as follows:
The respondent was employed by IBM (U.K.) Ltd. and then IBM Canada Limited for over 40 years before being terminated without cause with two months notice. When his employment terminated, he was 65 years of age and eligible to receive benefits under IBM's employer-funded pension plan; He had no intention of retiring and sued for wrongful dismissal. After termination, he received a pension benefit of $2,124.25 per month; The trial judge held that the appropriate notice period was 20 months; He awarded damages based on lack of notice for 18 months. The applicant was paid pension benefits after termination based on a fully vested pension; The trial judge did not deduct the amount of pension benefits paid during the notice period from the damages award. IBM Canada Limited appealed, arguing that an amount equal to the pension benefits should have been deducted from damages. The Court of Appeal dismissed the appeal.
My post on the March 2010 trial decision can be found here.