Danaher v. Moon Palace (2000) Ltd., 2002 N.B.Q.B. 86
Ms. Danaher was a 59 year old employee who worked as a restaurant supervisor. She had been employed as a waitress and then as the restaurant supervisor for a total of 13 ½ years. The owner of the restaurant entered into negotiations to sell the restaurant, and without consulting Ms. Danaher, the employer transferred her employment to the new owner. The new owner of the restaurant reduced Ms. Danaher’s working hours and reduced her pay. After six months, Ms. Danaher was dismissed by the new owner and only paid severance of $920.00.
Ms. Danaher sued and the employer was ordered to pay twelve months salary in lieu of notice plus an additional four months because of bad faith conduct. The Court held that the employer’s failure to advise the employee of the arrangement for transfer of the restaurant business constituted an act of bad faith. The Court also found that the new employer acted in bad faith when it offered Ms. Danaher her job in exchange for the discontinuance of her lawsuit. Of particular note is the Court’s finding that an employer has an obligation to act in good faith throughout the employment relationship with an employee.