Edmonton law firm owes ex-associate $28k after halving his salary without telling him
ALRB finds Travis McKay earned $17k bonus before resigning from Snyder & Associates LLP
The Alberta Labour Relations Board has ordered an Edmonton law firm to pay $28,000 to an associate who resigned soon after his base salary was cut in half without notice.
The board’s decision confirmed an order of a provincial employment standards officer, who found that Snyder & Associates LLP owed Travis McKay $4,500 in wages for failing to tell him about the reduction before the start of the pay period, plus more than $17,000 in bonuses earned by McKay in his final month of employment. The rest of the award to the lawyer consisted of vacation pay and fees.
According to the ruling, McKay joined Snyder in May 2019 at a starting salary of $6,000 per month, under an employment agreement that provided for $1,000 raises each month until his monthly rate hit an upper limit of $9,000.
However, the seeds of their split were sown on Jan. 31, 2020, when the bi-weekly $4,500 cheque McKay expected was replaced by a letter from the managing partner informing him that his terms of employment had been changed, effective from the start of the new year.
As a result, McKay’s monthly salary was reduced by half to $4,500, although the letter informed him he would also be entitled to 40 per cent of paid fees above a monthly quota of $11,250 on accounts receivable rendered after Jan. 1.
McKay told the hearing that the letter was the first he had heard from management on his new terms of employment, but instead of opting to treat the amendments as constructive dismissal, the decision says that he kept working.
In mid-March, McKay provided the firm with notice that he would resign at the end of the month, by which time he had brought in receivables totalling almost $55,000. After deducting the $11,250 monthly quota, the employment standards officer found that this entitled McKay to a bonus of $17,400 under the terms of his updated agreement.
At the ALRB hearing, Snyder & Associates argued that McKay’s March bonus was too high because the receivables generated by McKay included work that occurred before January 2020. However, ALRB Vice-Chair William Johnson sided with the lawyer, agreeing that “a plain and ordinary reading” of the law firm’s letter “includes accounts receivable generated after January 1, 2020 independent of whether the work upon which the accounts receivable is based occurred before or after January 1, 2020.”
By then, the law firm had dropped its opposition to McKay’s claim for $4,500 in wages for the last two weeks of January 2020, after conceding that it had not given appropriate notice under Section 13 of Alberta’s Employment Standards Code, which requires employers to advise employees of a reduction of wages before the start of the pay period in which the reduction is to take effect.
The law firm enjoyed its only measure of success in the matter of costs, which were only requested by McKay during his closing argument, when he claimed that the law firm’s appeal of the original employment standards order was meritless.
While McKay’s request “may have merit,” Johnson wrote that it would be unfair to award him costs without giving the law firm a chance to consider the request prior to the hearing.
Counsel for Snyder& Associates did not respond to a request for comment, while McKay declined the opportunity.
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