McMahon v Maximizer Services Inc., 2023 BCSC 4 (CanLII), <https://canlii.ca/t/jtpnm>
In this case, the plaintiff sought summary judgement in a wrongful dismissal action. She claimed that the employment contract was vague and unenforceable.
The employment contract provided, in part:
In the event Maximizer initiates termination, and that termination is without cause, Maximizer will provide the greater of:
- a) the notice (or payment in lieu) prescribed by the Employment Standards Actof BC as amended or replaced from time to time; and
- b) Two (2) weeks’ written notice of termination (or payment in lieu), PLUS an additional one (1) week for every completed year of service to a maximum of four (4) months(“severance”).
In the event Maximizer initiates termination and that termination involves the payment of severance, severance will be calculated using base salary only. (Note: Any unused vacation is payable by law, and would be in addition to severance). Other compensation elements (specifically including, but not limited to: incentives, commissions and bonuses directly tied to future performance; benefits documented in this Agreement; undocumented benefits or perks; monthly expenses typically incurred while employed; etc.) will not be considered in severance calculations.
The Court concluded:
[22] I find the Termination Clause to be clear. It states that upon termination without cause, Ms. McMahon would receive the greater of, under subparagraph (a), notice or pay in lieu of notice prescribed in the ESA and, under subparagraph (b), two weeks or more notice or payment in lieu of notice based on base pay only. The use of the word “and” in between clauses (a) and (b) does not detract from the ordinary meaning of the words “greater of” which precedes these paragraphs, being that Ms. McMahon would be entitled to the greater of the notice or pay in lieu of notice provided for in each of those options.
[23] With respect to the word severance, the Termination Clause is clear in that severance is used to define the notice Ms. McMahon would be entitled to under subclause (b) only. The defined term severance follows immediately at the end of subclause (b). As a result, the fact that severance under subclause (b) only includes payment of base salary for a minimum of two weeks does not offend the ESA. Simply put, Ms. McMahon is entitled to notice under whichever of the two options is better for her. I do not find that to determine her entitlement to notice or pay in lieu of notice requires that Ms. McMahon would be required to perform complex calculations, as she alleges.
The clause did not contravene provincial employment standards.