Aggravated Damages — Ontario Employment Law
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About Aggravated Damages
When an Ontario employee is dismissed, they are typically entitled to damages for lack of reasonable notice (or pay in lieu). However, in some cases, the way an employee is fired can cause harm that goes beyond the financial loss of the job. This is where aggravated damages come in. Aggravated damages are a separate, additional award intended to compensate an employee for the mental distress—such as humiliation, anxiety, or depression—caused by an employer's bad faith or unduly insensitive conduct during the termination process. It's crucial to understand that these damages are not for the normal stress of losing a job. Instead, they address the extra harm inflicted by the employer's behaviour. Under Ontario common law, employers have a duty of good faith and fair dealing in the manner of dismissal. Breaching this duty can give rise to a claim for aggravated damages, which are also frequently referred to as 'moral damages' or 'Honda damages' after the landmark Supreme Court of Canada case, Honda Canada Inc. v. Keays. Examples of conduct that might lead to such an award include being untruthful, embarrassing or humiliating the employee, spreading false allegations, or terminating someone while they are vulnerable on sick leave. Unlike punitive damages, which are meant to punish the employer for outrageous conduct, aggravated damages are purely compensatory. They focus on the actual harm and suffering experienced by the employee. The amount awarded depends heavily on the severity of the employer's actions and the documented impact on the employee's mental health. Because the line between normal distress and compensable mental distress can be fine, understanding how these situations are assessed by courts is key, and the specific facts of each case determine the outcome.
Frequently Asked Questions
What is the difference between aggravated damages and punitive damages in Ontario?
Aggravated damages compensate you for mental distress caused by the employer's bad faith conduct during dismissal. Punitive damages are not compensatory; they are intended to punish the employer for malicious or outrageous conduct and deter others from similar behaviour. It is possible, though rare, to be awarded both.
How much are aggravated damages usually worth?
There is no set amount. Awards in Ontario often range from $15,000 to $75,000, but can be higher in extreme cases. The court assesses the severity of the employer's conduct and the extent of the employee's proven mental distress to determine a fair figure.
Do I need a doctor's note to prove mental distress for aggravated damages?
While not strictly mandatory, medical evidence from a doctor, psychiatrist, or therapist significantly strengthens a claim. It provides objective proof of the harm you suffered, linking it to the employer's actions and making your claim more credible than testimony alone.
Is being fired in a cold or impersonal way enough to get aggravated damages?
Generally, no. The law recognizes that termination is inherently unpleasant. Aggravated damages are reserved for conduct that goes beyond the pale—actions that are untruthful, unduly insensitive, humiliating, or in bad faith, causing harm beyond the normal upset of job loss.
What is the time limit to sue for aggravated damages in Ontario?
A claim for aggravated damages is part of a wrongful dismissal lawsuit. In Ontario, you generally have two years from the date of your termination to file a civil claim under the Limitations Act, 2002.
When should I consult an employment lawyer about my dismissal?
If your termination involved more than just being let go—for example, if you were publicly humiliated, accused of things you didn't do, or the company was exceptionally cruel in how they treated you—it's wise to speak with a lawyer. They can help determine if the employer's conduct breached the duty of good faith and if a claim for aggravated damages is viable.
Common Scenarios
- A long-term manager is terminated for 'performance issues' that were never previously raised, just weeks after she reported a senior leader for harassment.
- An employee is called into a termination meeting and falsely accused of theft in front of junior colleagues before being escorted out by security.
- While on a documented medical leave for anxiety, a sales representative is terminated via a courier letter that claims 'job abandonment' and cuts off her health benefits immediately.
- An employer promises an employee a promotion to convince them to stay, only to eliminate their position two months later and provide a severance offer far below their entitlements.
- During a wrongful dismissal lawsuit, an employer maintains baseless allegations of serious misconduct against a former employee, causing significant reputational damage and emotional harm.
What You Should Know
- Keep a detailed, contemporaneous record of the termination meeting, including who was present, what was said, and how you were treated.
- If the dismissal causes you significant mental anguish, seek support from a medical professional. Their records can serve as critical evidence for an aggravated damages claim.
- Do not confuse aggravated damages with punitive damages. Your claim should focus on the mental harm you personally suffered due to the employer's conduct, not on a desire to punish the company.
- Remember that the standard for aggravated damages is high. You must demonstrate that the employer's conduct during the dismissal was in bad faith or unduly insensitive, causing harm beyond the normal distress of job loss.
- If you believe your employer's conduct warrants a claim for aggravated damages, it's essential to seek legal advice promptly to understand your rights and the strict two-year limitation period for filing a claim.
Featured Cases
Kennedy v. Kingston Area Taxi Licensing Commission
2025 ONSC 4706 (CanLII) · 2025-08-14Constructive Dismissal: Plaintiff Awarded 24 Months' Notice and $25,000 in Damages
A constructive dismissal case where the plaintiff alleged a toxic work environment due to micromanagement, belittlement, and harassment by the defendant. The court found the defendant’s conduct breached the employment relationship, awarded 24 months' notice and $25,000 in aggravated damages for mental distress.
Chan v. NYX Capital Corp.
2025 ONSC 4561 (CanLII) · 2025-08-06Wrongful Dismissal: Probationary Employee Entitled to Notice
A wrongful dismissal case where the plaintiff, terminated one day before the end of a probationary period, was awarded three months' notice based on Bardal factors. The court found the termination clause void for non-compliance with the Employment Standards Act, and no aggravated or punitive damages were awarded due to the employer's conduct not being high-handed or malicious.
Koshman v. Controlex Corporation
2023 ONSC 7045 (CanLII) · 2023-12-13Wrongful Dismissal: Senior Executive Employee Awarded 24 Months' Notice and $50,000 in Damages
A senior executive employee was summarily dismissed after 18.5 years of service. The court determined the appropriate notice period and awarded damages, including 24 months' notice of termination, $50,000 in aggravated damages, and $192,112.19 in costs for the employer's improper conduct and lack of defense.
Nagpal v. IBM Canada Ltd.
2021 ONSC 6853 (CanLII) · 2021-10-14Wrongful Dismissal: 24-Year Employee Awarded 22 Months' Notice and $40,000 in Aggravated Damages
A wrongful dismissal case involving a senior employee with 24 years of service who was terminated at age 48. The court determined a 22-month notice period based on Bardal factors, awarded 22 months' salary in lieu of notice, and $40,000 in aggravated damages for the employer's insensitivity. Pre-judgment interest was awarded at the statutory rate.
Humphrey v. Mene
2021 ONSC 2539 (CanLII) · 2021-05-04Constructive Dismissal: Toxic Workplace and Mental Distress Damages
A constructive dismissal case where the court found the employer's conduct, including a toxic workplace and exaggerated performance issues, constituted repudiation. The plaintiff, a 32-year-old COO with three years of service, was awarded 11 months' notice and $50,000 in aggravated damages for mental distress, and $25,000 in punitive damages for malicious and outrageous conduct. The court also ruled that a 'Without Cause Termination Provision' was void for lack of consideration.
McLean v Dynacast Ltd.
2019 ONSC 7146 (CanLII) · 2019-12-17Constructive Dismissal: Unilateral Changes and Aggravated Damages Awarded
A constructive dismissal case where the plaintiff was reassigned to a lower-status position with significant changes to duties, work environment, and compensation. The court applied the Potter test and awarded 28 months' notice, $25,000 in aggravated damages, and considered income from part-time work for mitigation earnings.
Churchill v. Aero Auction Sales Inc.
2019 ONSC 4766 (CanLII) · 2019-08-13Wrongful Dismissal: Senior Executive Awarded 12 Months' Notice and $75,000
A wrongful dismissal case involving a senior executive who was wrongfully dismissed after almost seven years of employment. The court awarded 12 months' notice and $75,000 in aggravated damages for bad faith termination, but did not award punitive damages.
Johnston v. The Corporation of the Municipality of Arran-Elderslie
2018 ONSC 7616 (CanLII) · 2018-12-19Wrongful Dismissal: Chief Building Official Awarded Damages
A wrongful dismissal case where a Chief Building Official was terminated without notice by the Municipality of Arran-Elderslie. The court found the termination wrongful due to the employer's failure to provide just cause, estoppel, and breach of contract. Aggravated and punitive damages were awarded for the manner of dismissal and mental distress.
West v. Mex Precision Wire Corporation
2018 ONSC 6572 (CanLII) · 2018-11-06Wrongful Dismissal: 12 Months' Notice, $10,000 Aggravated Damages
A wrongful dismissal case where a 59-year-old employee with 12 months of employment was terminated after four weeks' notice. The court determined the reasonable notice period to be 12 months, awarded $10,000 in aggravated damages for the employer's bad faith conduct, and dismissed the intentional infliction of mental suffering claim. Pre-judgment interest of $2,985.16 was awarded.
Horner v. 897469 Ontario Inc.
2018 ONSC 121 (CanLII) · 2018-01-05Wrongful Dismissal: Aggravated Damages Awarded for Termination During Holiday Season
A wrongful dismissal case where the plaintiff was terminated without notice during the holiday season. The court awarded aggravated damages for the manner of termination but denied punitive damages and other claims, including intentional infliction of mental suffering and discrimination. The court also awarded partial indemnity costs for the trial.
Singer v Nordstrong Equipment Limited
2017 ONSC 5906 (CanLII) · 2017-10-06Wrongful Dismissal: Senior Manager Awarded 17 Months' Notice and Bonus
A wrongful dismissal case involving a senior managerial employee terminated without cause. The court awarded 17 months' notice and a pro rata bonus of 4.634% of pre-tax profits for 2016, but denied bonuses for 2017 and 2018 during the notice period and damages for loss of benefits. The court also found no aggravated or punitive damages due to the employer's conduct.
Walker v Hulse, Playfair and McGarry
2017 ONSC 358 (CanLII) · 2017-01-17Wrongful Dismissal: Aggravated Damages and Standard of Review
A wrongful dismissal case where an employee was terminated without cause, but the employer alleged just cause. The trial judge awarded aggravated damages despite a lack of evidence of bad faith or mental distress, leading to an appeal on the standard of review and evidentiary requirements.
Morison v Ergo-Industrial Seating Systems Inc.
2016 ONSC 6725 (CanLII) · 2016-10-28Wrongful Dismissal: 12 Months' Notice and $50,000 Punitive Damages Awarded
A wrongful dismissal case where the court determined the appropriate notice period for an employee with a specific length of service, considering age, job market conditions, and the employer's conduct. The court also assessed whether aggravated and punitive damages were warranted due to the employer's bad faith and reprehensible conduct.
Cloutier v Q Residential LP Corp.
2015 ONSC 4431 (CanLII) · 2015-07-08Constructive Dismissal: 15 Months' Notice and Damages Awarded
A constructive dismissal case where the plaintiff was demoted and terminated without reasonable notice, leading to a dispute over damages and the application of Bardal factors. The court also considered allegations of aggravated damages due to the employer's conduct during termination and potential discrimination under the Ontario Human Rights Code.
Sweeting v Mok
2015 ONSC 4154 (CanLII) · 2015-06-26Wrongful Dismissal: 22-Year Employee Awarded 24 Months Notice
A wrongful dismissal case involving a 22-year employee who was terminated. The court assessed whether the termination was wrongful or constructive and determined the appropriate notice period and whether aggravated or punitive damages were warranted.
Lin v OTPPB
2015 ONSC 3494 (CanLII) · 2015-06-01Senior Investment Professional: Termination, Notice Period, and Incentive Compensation
A senior investment professional was terminated without cause after eight years of service. The court found no legal cause for termination and applied the McKinley v. BC Tel framework to determine a 15-month notice period. The employee was entitled to incentive compensation during the notice period, and the employer's unilateral amendments to the employment contract were deemed ineffective. Aggravated damages were not awarded due to the extended notice period adequately compensating the employee.
Armstong v Lendon
2015 ONSC 3004 (CanLII) · 2015-05-2526-Year Legal Secretary Awarded 21 Months Notice in Wrongful Dismissal
A wrongful dismissal case involving a legal secretary with 26 years of service who was terminated. The court awarded 21 months' notice period based on Bardal factors and $7,500 in aggravated damages for harm to dignity and reputation, finding no just cause for dismissal.
Chopra v. Easy Plastic Containers Limited
2014 ONSC 3666 (CanLII) · 2014-06-19Wrongful Dismissal: Just Cause and Reasonable Notice Determined
A wrongful dismissal case where the court determined the employer had just cause based on cumulative misconduct. The court also considered reasonable notice, mitigation of damages, and whether the plaintiff failed to mitigate his damages. Aggravated damages were not awarded due to no independent actionable wrong, and punitive damages for reprisal were also dismissed.
Barton v. Rona Ontario Inc.
2012 ONSC 3809 (CanLII) · 2012-08-03Wrongful Dismissal: Managerial Employee Awarded Notice for Safety Violations
A managerial employee was dismissed for workplace safety violations. The court found no just cause for dismissal and awarded ten months' notice. Aggravated damages were denied due to lack of evidence of bad faith.
Rowley v High Strength Plates & Profiles Inc
2011 ONSC 6221 (CanLII) · 2011-10-20Constructive Dismissal: 15-Year Sales Employee's Case
A constructive dismissal case involving a senior sales position with 15 years of service. The court determined that 12 months' working notice was reasonable and rejected claims for aggravated damages due to a lack of evidence of bad faith. The case also addressed the calculation of damages, including lost commissions and bonuses.