In a case that can only be described as a cautionary tale, an employer was ordered to pay 5 months pay in lieu of notice to an employee to whom it had intended to pay only 3 weeks ESA termination pay. This case should serve as a reminder to employers to carefully review termination letters before they go to employees.
In Stowar v. Telehop Communications Inc., an employer mistakenly provided an employee with an offer of 5 months pay in lieu of notice in a termination letter, instead of the 3 weeks of ESA termination pay it had intended to provide. The letter was poorly worded, and did not establish a possible demarcation between ESA termination pay and pay in lieu of notice at common law.
The court ruled that, once signed, the termination letter constituted a valid and binding contract that the employee could enforce against the employer.
The lesson: when drafting termination letters, make sure you get it right the first time.
To view the entire case, visit the following link:
Jeremy D. Schwartz – [email protected]