NEW DEVELOPMENTS IN WRONGFUL DISMISSAL LITIGATION

Abstract

Tort and contract law share an historical alignment, but concentration on commerce led 19th century courts to exclude considerations of fairness when quantifying damages in contract, creating a sharp distinction between the two. The authors consider the employment contract as an ordinary commercial contract, arguing commercial rules should not limit the quantum of damages in an action for termination without cause, and that fairness should be considered in certain types of contracts. Canvassing developments in this area, they focus on statutory intervention guaranteeing minimum standards of fairness, and judicial use of implied terms and fundamental breach, which have allowed compensation for non-pecuniary losses by way of mental distress. They applaud these developments, using them to argue for concurrent liability in tort and contract, and for exemplary damages flowing from injury to reputation. The progression is justified because damages are reasonably foreseeable from breach of such a contract. The authors conclude by instructing counsel on how to present these analyses in court, and instructing employers on how to avoid being negatively affected by expanding common law remedies.