What is a ‘failure to mitigate’ in wrongful dismissal actions?

Losing your job unexpectedly can be incredibly upsetting. You can feel angry, confused and lost. However, what you do or don’t do in the days and weeks following a termination can be incredibly important if you decide to pursue legal action citing wrongful dismissal.

For instance, any damages you might receive could be reduced if there is evidence that you failed to mitigate your losses.

What did you do to minimize damages?

An important legal concept to understand in this situation is the obligation to mitigate losses, which refers to any actions you take to reduce the potential financial impact of the wrongful dismissal. 

Have you made a reasonable effort to find a new — and, importantly, comparable — job? Did you take a retraining course or otherwise attempt to maintain an income?

While this might seem subjective, the courts generally want to see evidence that you have applied for several positions at various companies and were prepared to take a job if offered. That said, you are not obligated to accept just any offer; it should be similar to your previous roles and have comparable compensation and benefits.

However, if you file a wrongful dismissal claim and your former employer argues that you did not take these or similar steps, the courts can reduce any award you might receive. 

For an example of this scenario, we can look at a case from last year. The British Columbia Supreme Court ruled that a woman did not adequately seek employment after her airline employer terminated her without cause. The 61-year-old worker admitted that she did not look for work because she was no longer interested in working in the airline industry.

Citing this failure, the courts reduced the woman’s damages. 

Avoiding a similar outcome

After losing a job, keeping track of your employment efforts can be crucial if you plan to pursue a wrongful dismissal case against your former employer.

Make a note of all the places you apply to and details on the potential positions you seek. If you receive an offer you do not ultimately accept, retain the documentation and record the reasons behind your refusal. 

These measures can help you maximize your compensation in a legal claim. An experienced employment lawyer can assist employees with determining if they have taken the steps necessary to meet their obligation to mitigate.