The Court of Queen’s Bench of Alberta has ruled in favour of an investment banker in a dispute with his former firm over severance.
Denis Rajotte sought greater severance from National Bank Financial Inc. (NBF), after he was terminated without cause by the firm less than a year into the job.
According to the Nov. 15 court decision, Rajotte joined NBF from CIBC Word Markets on May 1, 2015, and was terminated without cause on Feb. 11, 2016. Rajotte received a severance payment from the firm, but argued that his total severance should have been more based on the terms of his employment agreement with the firm, which guaranteed him an annual bonus of at least $1 million, among other things.
“He argues that… the employment agreement as a whole was designed to protect him in situations exactly like this one, namely a termination before a track record of yearly income and bonuses had been established,” Judge James Farrington writes in the decision.
The court ruled Rajotte was entitled to a bonus of $500,000 for the period ending April 30, 2016, even though he’d been terminated at that point. As a result, it found that his severance for 10 months should be $979,166. Rajotte is also entitled to payment of his pro-rated base salary from his termination date to May 11, 2016, which is when his work would have ended with a proper 90 day notice of termination, the court ruled.
The court declined to award additional, punitive damages against NBF.
“There is no doubt that National Bank took a hard line on some matters such as purporting to pay severance in monthly instalments, seeking a non-compete clause which it is not entitled to, and purporting to unilaterally enforce its internal termination policy on other matters. Having said that, I do not think that any of those matters rise to the level of conduct for which punitive or aggravated damages have been granted in a wrongful dismissal context,” Farrington writes.