The employee was never recalled back to work, and so she brought a claim against ASCO for wrongful dismissal and sought summary judgment. The judge found in the employee’s favour, pointing out that ASCO was not a party to the Release between the employee and 637, and therefore was not absolved from paying severance for the employee’s full work history. Further, the judge said the law required that the court view the employee’s employment as continuous. As a result, ASCO was ordered to pay the employee for a period of 20 months, which would be reasonable notice given the employee’s full work history.<\/p>\n

ASCO appealed the decision. The Ontario Court of Appeal overturned the summary judgment, holding that the issues required a full trial to resolve. In particular, there is a fundamental disagreement between the parties as to the terms of the employee’s employment with ASCO. ASCO claims it hired the employee on a fixed-term basis as a general labourer, to assist with the relocation of assets, whereas the employee claims she understood she would continue her employment as a welder, and that the employment term was indefinite. She also claims she understood she would be credited with her time at 637. To property determine these issues, a trial is necessary. ASCO must establish its position unambiguously; failing that, it will fall to ASCO to refute the position that it should be liable for recognizing the employee’s history with 637 in assessing reasonable notice.<\/p>\n

This case has already cost the parties significant legal fees and will continue to do so until the matter is resolved conclusively. The takeaway for any employers hiring staff from a purchased company is that a clear employment contract setting out the terms of the “new” employment is imperative. This way, there can be no discrepancy between the parties as to the length of employment, and how the employee’s previous work history with the purchased business will be treated in the event of termination.<\/p>\n