For years, Alberta employees who became disabled during their termination notice period were told they had no claim at all. A new Court of King’s Bench decision changes that. Here’s what Babcock v Thuro Inc means for your right to pursue wrongful dismissal damages, even if you’re now on disability.
If you were given working notice and later became too sick or disabled to keep working before the notice period ended, you may have been told your claim was worthless. For years, one Court of King’s Bench decision — Belanger v Western Ventilation Products Ltd — was used by Alberta employers to argue exactly that.
On September 3, 2026, Justice Jugnauth of the Court of King’s Bench overturned that approach in Babcock v Thuro Inc. Employment Law Advocates founder Lluc Cerdà, together with Jon Pinkus of Samfiru Tumarkin LLP, represented the successful appellant. Here’s what changed, and why it matters.
The Belanger Problem
In Belanger v Western Ventilation Products Ltd, an Alberta Applications Judge held that an employee who became disabled during a period of insufficient working notice had suffered no compensable loss at all. The reasoning: since the employee couldn’t have worked during the missing portion of notice anyway, and would have received only disability benefits instead of salary, there was nothing to sue for. That decision was upheld on appeal.
The Mistake Belanger Made
The problem with Belanger is that it answered the wrong question. Whether an employee is entitled to damages for insufficient notice, and whether a benefit like disability pay should later be deducted from those damages, are two separate legal questions. The Supreme Court of Canada settled this distinction in Sylvester v British Columbia and again in Waterman v IBM Canada Ltd: an employee’s inability to work during the notice period is irrelevant to whether they’re entitled to damages in the first place. Disability benefits only come into play afterward, as a possible deduction from damages. The law was settled prior to Belanger that being disabled and in receipt of disability benefits did not act as a bar to a claim of wrongful dismissal damages. The decision in Babcock restores that clarity in the law.
How Justice Jugnauth Overturned It
On appeal, Justice Jugnauth rejected the idea that horizontal stare decisis — the principle that judges of the same court should generally follow each other’s decisions — required the lower court to follow Belanger. Alberta law recognizes narrow exceptions to that principle, including where an earlier decision was reached ‘per incuriam,’ meaning without considering a binding authority that would have changed the outcome. Justice Jugnauth found that Belanger fell squarely within that exception: it was decided without properly applying the Supreme Court’s framework in Waterman, and it conflated entitlement with deductibility in a way that binding Supreme Court authority does not permit. That earlier decision being affirmed on a prior appeal did not change the analysis.
What This Means for the Babcock Appeal
Applying that reasoning, Justice Jugnauth found the 13 months of working notice Mr. Babcock received fell well short of what he was owed.
| Justice Jugnauth awarded Mr. Babcock 20 months’ reasonable notice — not the 13 months he was given, and not the 12 months his employer argued was sufficient. |
That figure came from a straightforward application of the Bardal factors, the four considerations Alberta courts use to set a dismissed employee’s notice period:
- Age: 62 when notice was given, 63 when his employment ended — a significant factor given the added difficulty older workers face finding comparable re-employment.
- Length of service: approximately 24 years with the same employer, which strongly favours an extended notice period.
- Character of employment: while not a management role, his responsibilities — training new operators, supervising helpers, and input on hiring — went beyond a typical labourer’s, modestly favouring longer notice.
- Availability of similar employment: his specialized experience in the sewer, water maintenance, and vacuum-truck industry, combined with a pandemic-disrupted labour market, made comparable work significantly harder to find.
Weighing all four factors, the Court awarded Mr. Babcock 20 months — well above the 12 months the employer argued for.. The summary dismissal of his claim was set aside entirely. Because the actual disability insurance policy was never put into evidence, the Court couldn’t decide on a summary basis whether his disability benefits should reduce his damages. That narrower question goes to trial — but his right to pursue the claim at all is no longer in doubt.
Why This Decision Matters Beyond One Case
For nearly seven years, Belanger gave Alberta employers a powerful argument: a plaintiff’s subsequent disability extinguishes their wrongful dismissal claim. This decision rejects that argument. Employers can no longer rely on Belanger to argue that a subsequent disability disentitles a terminated employee from being awarded wrongful dismissal damages. Going forward, a disabled employee’s entitlement to damages must be assessed the way the Supreme Court actually requires — first determining whether reasonable notice was given, and only afterward considering, with proper evidence, whether any benefits received should reduce the award. That’s a meaningfully different, and fairer, starting point for every case like it.
In short: becoming disabled during your notice period is no longer, on its own, a reason to lose your severance entitlements.
The deductibility of Mr. Babcock’s disability benefits still has to be decided at trial, so the final dollar figure isn’t settled yet. But the door that Belanger closed is now open again for every disabled Alberta employee in this situation.
Your disability does not erase your right to be heard.
Alberta’s Limitations Act generally gives you two years from the date your employment ends to bring a wrongful dismissal claim, so this decision matters now for anyone weighing whether it’s worth pursuing.
Think This Might Apply to You?
If you were given working notice and became sick or disabled before that notice period ended this decision may directly affect your rights. You don’t have to work through what it means for your specific situation alone. Employment Law Advocates founder Lluc Cerdà and the team behind this result are ready to help you understand where you stand. Book a consultation to find out.
Case cited: Babcock v Thuro Inc, 2026 ABKB 615 (per Jugnauth J.), appeal from the decision of Applications Judge J.T. Prowse dated August 22, 2024. L. Cerdà and J. Pinkus for the successful Appellant.
