Employment Law - Some Dos and Donts of Employee Termination - Case Study Example

Employment Law Employment Law The element of ‘at will’ employment does not exist in Canada. As such, it is vital for employees to comprehend and remember this concept. Therefore, an employee is legally required to provide an advance notice to the employee prior to dismissal or termination. However, the employer is not required or legally obligated to provide an advance notice if he/she has a just cause for the dismissal or termination. Although the term “just cause” represents a narrow and limited category of employee behavior, it is a significant aspect of employee termination. As such, the paper will critically analyze the concept of terminating the employment relationship when there is just cause and when there is not. To effectively tackle and analyze this concept, the term just cause will be defined and looked at in depth. Additionally, categories of employee conduct that are recognized by Canadian courts to warrant just cause termination will be highlighted in the text. The common law and statute law govern and control employment practices in Canada. Thus, Canadian employment statutes are implemented by both the provincial and federal bodies. Due to these two bodies, a statutory employment law framework has been put in place to standardize and control the primary aspects of employment (employer- employee relationships). Some of these basic aspects include employee safety at the workplace, minimum wages, pay equity, and anti-discrimination and employee termination. Just like most nations worldwide, most of Canada’s employment laws comply with the ILO (International Labor Organization) conventions. In fact, Canada has ratified most of the statutory ILO laws. These statutory standards establishes employee’s rights leading to the abolishment of ‘at will’ employment in Canada. Canada just like the United States is made up of provinces (ten). These provinces are joined together by the constitution act 1867. Both the provincial legislatures and federal parliament possess the authority to enact employment and labor laws. Despite the employment statutes being similar in Canada, they however have subtle distinctions in each and every province. Hence, employment cases should be analyzed in the provinces they occur. Generally, as an employer, it is wise and necessary to possess a written employment agreement since its beneficial to both the employer and the employee (Deakin & Morris, 2012). In the absence of a written agreement, common law governs the employer employee relationship. On the other hand, a written agreement can reduce or limit an employer’s common law exposure while also increasing an employee’s obligations to the employer. To reiterate an earlier stated point, common law governs the relationship in the absence of a written employment agreement. Primarily, the employment agreement contains various elements such as the employee’s responsibilities, title, vacation, benefits and salary. Additionally, terms such as termination for cause and termination without cause are included in the agreement. The Saskatchewan human rights code defines an employee as an individual who is employed by an employer while an employer is an individual employing one or more employees. Canadian employment law states that any employer can dismiss an employee immediately for just cause. This makes it necessary for both the employer and employee to succinctly grasp the meaning of just cause. An employer is not required to pay the dismissed employee severance pay or statutory termination pay if the dismissal is as due to a just cause. According to common law or the employment legislation, an employer is obligated to pay an employee severance or statutory termination pay as a substitute of a dismissal notice (McShane & McPhillips, 1987)). Therefore, an employer is allowed to dismiss an employee immediately (without the common law or statutory notice) if only the employee might have committed an act which is contrary to his/her employment contract. This act has thus undermined the whole employment relationship. In other terms, the employee has committed an action that has fundamentally breached the contract. In McKinley v. BC Tel, the Canadian supreme court implied that just cause will only exist in a situation where the employee has violated a primary condition of the contract, his/her conduct is wholly inconsistent with his/her obligations to the employer or undermines the faith existing in the work relationship. When an employee is dismissed wrongly, the employer in most circumstances faces dismissal lawsuits that might be costly to him/her (employer). Therefore, employers and employees have to comprehend the meaning of just cause. So, what is just cause? The Ontario court of appeal in 1967 while ruling on the case of R. v Arthurs defined just cause in the following way (just cause has continued to be defined this way since then) (Barnacle, 1991) “If an employee has been guilty of serious misconduct, habitual neglect of duty, incompetence, or conduct incompatible with his duties, or prejudicial to the employer’s business, or if he has been guilty of willful disobedience to the employer’s orders in a matter of substance, the law recognizes the employer’s right summarily to dismiss the delinquent employee.” The burden of proof (proving dismissal cause) is solely the employer’s responsibility (Prakken, Reed & Walton, 2005). Consequently, employers should comprehend that a middle ground or near cause then does not exist. An employer would be said to be wrongfully terminated if the employer cannot or is unable to illustrate just cause in the dismissal. As a penalty, the employer would be obligated to pay the employee monetary damages due to wrongful employment termination. The courts have acknowledged some conduct behaviours to warrant just cause dismissal. Some of the categories or factors include; insubordination and insolence, dishonesty (theft or fraud), conflict of employer- employee interest, fidelity duty or breach of trust, sexual harassment, lateness or chronic and frequent absenteeism, grave incompetence, misrepresentation of credentials and qualifications, and workplace intoxication. Although these factors or reasons are not exhaustive for just cause termination/ dismissal, it should be clearly clarified that in any of these factors to lead to a just cause dismissal, the factor/ or factors should be of such magnitude that the relationship between the employer and employee is totally undermined in agreement with the principles outlined in McKinley. Additionally, an employer should be extra careful when dismissing an employee without notice under the drug use or intoxication at the workplace as the main reasons. Since alcohol addiction or drug addiction is seen as an illness according to the human rights legislation, it tends to attract the duty to accommodate. This implies that employers should minimize the use of these two reasons as cause for employment termination. Before dismissing an employee under the just cause context, an employer should first verify whether the misconduct or employee breach can be easily proven, and whether the degree or nature of his breach is severe enough to completely destroy the rust in the employment relationship. Some situations such as theft or fraud tend to warrant a straight forward just cause dismissal. However, other many instances or actions are not as simple and straight forward as theft and fraud. Sadly, there is no clear and straight forward way of determining what makes up just cause. Nevertheless, poor performance and incompetence, and insubordination or insolence at work are the two major categories that lead to wrongful dismissal in most cases. Insubordination or Insolence at the Workplace The courts often define insolence as the act of an employee directing abusive, contemptuous and derisive language to his/ her employer or superior. Insubordination on the other hand is the intentional refusal of the employee to obey and listen to the employer/ superior’s reasonable and lawful command. Since the burden of proof rests or lies with the employer, he/ she must prove that disobedience was intentional, the command in question must be significant and serious in nature, the command must be limited to the employee’s scope, the command was lawful and reasonable and, the command was specific, coherent and clear. The act of insolence to be considered a just cause has to be severe enough to break the employer – employee relationship. For instance, in Wise v Broadway Properties Ltd the employee was dismissed for being insolent. The employer had employed the employee as a caretaker at his (employer) apartment. Dissatisfied with the employer’s pay, he wrote a letter to his employer and compared or likened him to a Nazi. Of note is that the employer was an eighty year old Jewish man, and as history has it, the Jews were badly massacred by the Nazis. By likening him to a Nazi, the employer was deeply offended and he subsequently dismissed his employee. The lower courts and the court of appeal of British Columbia upheld the dismissal at trial. The employee had totally broken and indented the employment relationship beyond repair by calling his eighty year old Jew employer a Nazi. Nonetheless, with regard to insolence and insubordination, the courts tend to argue that more than two misconduct instances are needed for a just cause dismissal. When presented to the courts, they (courts) will weigh the gravity / weight of the act before making a ruling. The employee might be excused if only the employer had provoked and led him to carry out the actions of insubordination and insolence. Also, the courts will evaluate and analyze the employee’s past relations and history with the employer before making a judgment. The employee is more likely to be excused for his/ her insubordination/ insolence if he/ she had had good relations with the employer. Serious Employee Incompetence According to Jesseph (1989), incompetence is an employee’s inability to do his basic duties, functions and responsibilities. For an employer to terminate the employee on grounds of incompetence, the employee’s incompetence level must be below an acceptable level of competence. The Boulet v. Federated Co-operative Ltd bench decision by the Manitoba court of queens has had a major influence on what factors courts in Canada consider while evaluating whether an employer possessed just cause in dismissing his/her employee on grounds of incompetence. The main principles or factors emanating from the case which courts focus on to reach a judgment include; gauging of employee performance against an objective standard, warning or notice is not applicable in a case where the performance is very poor, the employer must prove that the job performance standard was communicated to him/ her (employee). Therefore, these factors should be taken into consideration by an employer aiming to dismiss his/her employee on grounds of poor performance and incompetence. Termination/ Dismissal without Cause Employers must give their employees a notice of dismissal when the just cause is absent. Alternatively, they can pay their employees in lieu of the notice. Termination without cause entitlements are mainly governed by the following three sources; the Canada labor code, the common law, and the employment contract. The Canada Labor Code The Canada labor code (the code) identifies two employee dismissal entitlements (severance pay and notice of dismissal). As earlier stated in the text, these two obligations are avoided if there is just cause for dismissal. Thus, they only apply when there is no cause for termination. The code sets out the minimum standards for employee/s notice of dismissal. An employer complies with the code by giving his / her employee a working notice or paying him/ her to forego the notice. To terminate more than 50 employees, an employer is required by the code to issue them a four week notice. Also, the employer has to inform the minister of labor via a written notice of the mass termination 16 weeks before termination date. On the contrary, the code states that severance pay is given only to employees who have been employed for more than 12 continuous months. Common Law Common law comes into effect when there is no employment agreement. Common law are the rules and guidelines developed in courts or by courts. At common law, failure to provide an employee with reasonable notice prior to dismissal often results in the employee seeking compensation or damages for wrongful termination. Reasonable notice at common law is influenced by factors such as the employee’s duties and responsibilities, age, and length of service. Contract All employment parties have a contract whether it is oral or put in writing. Nevertheless, to be enforceable, the contracts must be in writing. Employment contracts list out agreement terms such as termination obligations or procedures and the employment period or length. Conclusion An employment can be terminated when there is just cause and when just cause is absent. Normally, just cause arises due to serious employee misconduct and poor employee performance and failure to improve. On the contrary, termination without cause warrants a reasonable dismissal notice or severance pay in lieu of the notice or both. References Barnacle, P. J. (1991). Arbitration of discharge grievances in Ontario: Outcomes and reinstatement experiences (No. 62). Kingston, Ont.: Industrial Relations Centre, Queens University. Deakin, S. F., & Morris, G. S. (2012). Labour law. Hart publishing. Jesseph, S. (1989). Employee termination: some dos and don’ts’. Personnel, 66(2), 36-38. McShane, S. L., & McPhillips, D. C. (1987). Predicting reasonable notice in Canadian wrongful dismissal cases. Industrial & Labor Relations Review, 41(1), 108-117. Prakken, H., Reed, C., & Walton, D. (2005, June). Dialogues about the burden of proof. In Proceedings of the 10th international conference on Artificial intelligence and law (pp. 115-124). ACM. Read More