Fired worker allowed to keep filing health claims after getting severance, B.C. tribunal finds

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A worker who claimed about $3,700 in health-care expenses in the weeks after he was fired with severance does not have to repay his former employer, B.C.'s small claims tribunal has ruled.

N. Wallace & Company Ltd.'s bid to force Andrew de Sequera to reimburse those expenses, as well as $389 in fees charged by the third-party administrator of its health benefits, was dismissed by the Civil Resolution Tribunal last week, in a decision published days before the Labour Day long weekend.

"I find that there is no legal basis for Wallace to be repaid either amount," tribunal member Eric Regehr wrote.

The tribunal heard de Sequera was terminated without cause in November 2021, about 13 months after he began working for the company, and given one paycheque's worth of severance instead of two weeks' notice.

In the weeks that followed, he submitted two health expenses, for $3,015 and $707, to N. Wallace & Company's benefits administrator, and was repaid all but $15.

The company later "demanded" that he repay the benefits and administration fee, according to the decision. When de Sequera refused, the company filed a claim through the tribunal.

Regehr found the case hinged on "the legal nature of severance pay."

N. Wallace & Company argued de Sequera was no longer an employee after receiving his termination notice on Nov. 10, and from that point on was not entitled to any of his former benefits, which included an annual health-care spending account of $3,000.

Regehr disagreed. Since de Sequera was paid twice monthly, and received his last regular paycheque on Nov. 15, the tribunal member found the final two weeks of that month were effectively his "notice period," even though he had been given severance.

"When an employer terminates an employee without cause, it has breached the employment contract even if it pays appropriate severance at the time of termination," Regehr wrote.

"When an employer breaches an employment contract in this way, the employee is entitled to be reimbursed for any out-of-pocket expenses they incur replacing their employment benefits during the notice period, unless the employment contract expressly provides otherwise."

The employment contract between N. Wallace & Company and de Sequera did not address what would happen to his benefits after termination one way or another, Regehr noted.

The tribunal member also referenced a "somewhat similar" case heard in B.C. Supreme Court, in which a woman was fired with severance shortly before she would have received an annual performance bonus.

"The court determined that the employee was entitled to any bonuses she would have earned during the notice period," Regehr wrote.

While the tribunal dismissed N. Wallace & Company's claim, it also refused to award de Sequera $224, the cost of a consultation with a lawyer, which he claimed as a dispute-related fee.

The Civil Resolution Tribunal does not award compensation for legal fees "except in extraordinary circumstances," Regehr wrote. 

Despite being mostly pleased with the outcome of the case, de Sequera told CTV News battling his former employer over legitimate health claims was a source of unneeded stress weeks after he was let go.

He initially prepared by using the B.C. Labour Laws website and getting a free 30-minute consultation through Access Pro Bono, but ultimately still felt he needed to pay for legal help.

"I was lucky because I had the funds and I had the support to go down that avenue, but what if I didn't?" he said. "I could have been bullied, for lack of a better word, into paying out this sum."

N. Wallace & Company did not respond to a request for comment.