$77,559 in Commissions and 10 Months’ Severance Awarded in Kraft v. Firepower Financial Corp.
Firepower Financial’s wrongful dismissal of a commissioned M&A advisor has resulted in a court order to pay over $77,000 in withheld commissions, after the Ontario Superior Court ruled the company had no legal basis to cut off incentive pay following termination. Employment lawyer Daniel Lublinl of Whitten & Lublin successfully represented the plaintiff in Kraft v. Firepower Financial Corp, securing 10 months’ pay in lieu of notice, full commission entitlement, vacation pay, and a share of the annual bonus pool.
TL;DR:
Firepower Financial was ordered by the Ontario Superior Court to pay a wrongfully dismissed employee 10 months’ severance plus $77,559 in withheld commissions. Employment lawyer Daniel Lublin of Whitten & Lublin successfully argued that commissions earned before termination cannot be cut off simply because payment falls due afterward. If your employer is withholding commissions after letting you go, you may have a strong legal claim.
The Facts
- The plaintiff, a commissioned mergers and acquisitions (M&A) advisor, earned a base salary, plus bonuses, benefits, and commission on successful deals.
- In March 2020, at the onset of the COVID-19 pandemic, he was terminated without cause.
- Before dismissal, he sourced and finalized a major M&A opportunity with Arzon Ltd, although the deal did not pay out until afterwards.
- The employer refused to pay the commission on the Arzon matter, arguing that the Plaintiff needed to be employed when the deal was paid out, although this was a limit not grounded in the employment contract.
- The Arzon deal closed six months post-dismissal, generating over $77,000 in commission.
The Legal Issues
Daniel Lublin argued that:
- The plaintiff was entitled to reasonable notice, including salary, benefits, vacation, and bonus especially given the challenges of job hunting during the pandemic.
- Commissions must be paid if the underlying work was done before termination and the deal closed during the notice period.
- The employer’s cut-off on the commission was arbitrary and unenforceable.
The Court’s Decision
The Court agreed with the Plaintiff and made the following decision:
- The plaintiff was entitled to 10 months’ notice, reflecting his role, tenure, and the extraordinary economic conditions due to termination at the outset of COVID-19.
- The employer’s cut off on commissions had no contractual basis and was rightly dismissed.
- Relying on Matthews v. Ocean Nutrition Canada Ltd., the Court held that commissions are payable if the work was substantially performed prior to termination even if payment occurs afterward.
- Because the Arzon deal generated fees within the 10-month severance period, the commission payable to the Plaintiff was wrongfully withheld.
- The plaintiff also received a portion of the annual bonus, calculated based on his two-year earnings average.
- Finally, the plaintiff was also awarded a sizable portion of his legal costs.
The Outcome
The plaintiff was awarded:
- 10 months’ pay in lieu of notice
- $77,559 in commissions from the Arzon deal
- Vacation and holiday pay
- Bonus pool compensation
- Legal fees
Key Takeaway
The Firepower Financial wrongful dismissal case ruling reinforces an important principle: employees can be entitled to incentive compensation for deals or work completed before termination, even if payment is delayed until afterwards. Employers cannot impose arbitrary limits that undermine common law rights and need to have well-drafted employment contracts or other plan terms to justify attempting to withholding commissions or other incentive payments not yet paid out.
With strategic and compelling advocacy by Dan, the Court recognized not only the legal entitlements at play, but also the real-world difficulties of job loss during a global crisis.
Terminated? You May Be Owed More Than You Think.
If you’ve been let go and believe you’re owed commissions, bonuses, or compensation for work already completed, don’t assume your rights end upon your job loss. As Kraft v. Firepower Financial shows, you may be able to claim compensation for work performed prior to termination but not yet paid to you.
Speak to an experienced employment lawyer who can assess your situation and fight for what you’re rightfully owed. Book a consultation with a Whitten & Lublin lawyer online or by phone at 416 640 2667.
