To Retire or Not to Retire… That is the Question

To Retire or Not to Retire… That is the Question

Kalen Ingram
Posted February 3, 2020 Category: Individuals/Families

A 2019 decision of the Ontario Court of Appeal serves as a reminder that employers cannot always rely on an employee’s retirement notice.

The facts in English v. Manulife Financial Corporation, 2019 ONCA 612 are relatively simple. In September 2016, Elisabeth English was a 64-year-old employee when her employer, Manulife, announced it would be implementing a new computer system.  Ms. English had been planning on retiring at the end of 2017 but decided that she would move her retirement ahead by a year instead of going through training on the new computer system. Ms. English notified her supervisor of her retirement decision and a formal announcement was made to her co-workers.

The key evidence in this case involved the discussion between Ms. English and her supervisor.  The evidence revealed that Ms. English told her supervisor that she was not entirely sure about whether she wanted to retire.  Her supervisor responded that if she changed her mind, she could always reconsider.

Three weeks later, Manulife announced that it would not be proceeding with the new computer system.  As a result, Ms. English told her supervisor she would revert to her original plan to retire at the end of 2017. 

Over a month later, however, Manulife told Ms. English that it would “honour” her retirement notice and that her employment would end at the end of 2016 as she had previously said.  She was told not to come back to work after December 12, 2016.

Was Ms. English wrongfully dismissed or did she resign?

The Court of Appeal determined that since the notice of resignation was not clear and unequivocal, it was not an effective resignation.  The Court further held that Manulife condoned Ms. English’s equivocation when the supervisor told her she could change her mind. 

As a result, when Manulife forced Ms. English to “honour” her resignation even after she changed her mind, it wrongfully terminated her employment.  Ms. English was therefore entitled to 12 months of pay in lieu of notice.

The result of this case is not surprising and reinforces the importance of having clear discussions with employees about their retirement plans.  Employers should be cautious about “honouring” retirement notices that are unclear, equivocal, or made under duress.

Kalen Ingram
Posted February 3, 2020 Category: Individuals/Families

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