Terminating Employment Relationship When There Is Just Cause and When There Is Not - Case Study Example

Terminating Employment Relationship When There Is Just Cause and When There Is Not Introduction As explained by Zvulony (2010), Just Cause is legal terminology used in Canada to refer to termination of employment without notice. To uphold the Just Cause clause, a Canadian court of law must establish that there is sufficient proof for employee misconduct and that the nature and magnitude of this misconduct meets the minimum benchmarks for dismissal without notice. To establish the minimum benchmarks sufficient for this dismissal, the court must look at the following four factors (Zvulony, 2010): a) That the alleged employee misconduct, led to a collapse in employment relationship through violation of fundamental requirements of the employment contract which then destroyed the employer’s confidence in the worker. b) The level of position held by the employee in the organization. Senior employee are held more accountable and their misconduct taken seriously in comparison to their juniors. c) Whether warning was given by the employer prior to the said termination. Lack of evidence of any previous warning makes Just Cause much harder to prove in a Canadian court of law. d) That the employee was accommodated in past misconduct before finally being dismissed. Existence of prior warnings serves as evidence in this case. Methodology used in the determination of Just Cause Just Cause came to light in Canada when the Supreme Court of Canada was confronted by the in McKinley v. BC Tel case. Facts of the case: Martin McKinley, an accountant who had worked in several positions at BC Tel group of companies for 17 years developed high blood pressure that worsened over time rising from mild to serious. Following his doctor’s advice, the employee took leave of absence and agreed with his supervisor that upon return to work, he would need a position with lesser responsibilities, something that the supervisor said he would take into account. Two positions that were suitable given his medical condition opened up but were not given to him neither were alternative employment offered. He was later to be fired while still on leave and offered severance package which he refused to accept and instead chose litigation. A few days to trial, it emerged that Martin McKinley had not been entirely honest about his condition so at the trial, the jury was instructed that for Just Cause to exist, the plaintiff’s dishonesty must be to a level that is inconsistent with the employment relationship. This would entitle him to the principles of Wallace v. United Grain Growers Ltd., [1997] 3 S.C.R. 701. He was later found to have been improperly dismissed and awarded damages but the case did not end there. The British Columbia court of Appeal later held that the instructions to the jury were not correct and that dishonesty while employed constitutes Just Cause, so a retrial was ordered and the case made it to the Supreme Court of Canada. The Supreme Court restored the trial decision on wrongful dismissal stating that dishonesty should be looked at in isolation and its facts and circumstances determined independently. According to Bamber (2010), Just Cause in light of the McKinley v. BC Tel case, has the following probable areas of misconduct in the Laws of Canada that call for application of Just Cause or not: Dishonesty: Examples in this category are fraud and theft which are acts of misconduct that totally ignore employer’s trust on the worker. It is however important to note that not all acts of dishonesty amount to Just Cause. In the case of Geluch v. Rosedale Golf Assn., Ltd, it was held that taking home wine and food from the golf club was insufficient for dismissal because but of his job involved sampling the said wine and food for quality purposes (The Canadian abridgment: Case digests, 1966). Dismissal under Just Cause would be appropriate if the employer provided proof of the employee’s intention to steal which was not done in this case and therefore, dismissal without notice was found not to match the alleged misconduct. On the contrary, when an employee deliberately covers shortage in inventory and encourages other employees do so as was in the case of Alvi v. YM Inc. (Sales) (c.o.b. Stitches), then Just cause comes into play. Disobedience: This category of misconduct encompasses the refusal by an employee to yield to his employer’s authority that includes failure to work in line with the provided instructions and organizational policies. Canadian courts always establish the significance of incidences of insubordination before accepting Just Cause and if it’s the first incident and not so serious, then dismissal without notice is not accepted. An example in the Daniels v. Canadian Gift & Tableware Association case where an assistant editor repeatedly disobeyed her supervisor and even went straight to the board whenever the supervisor disagreed with her. Having been warned on numerous occasions, dismissal without notice was accepted by the court as there was Just Cause. Breach of confidence: This occurs when an employee acts in a manner that promotes his/her own interests and not that of the employer. Where there’s clear conflict of interest, trust may most likely be broken but the facts must be reviewed to establish if indeed trust has been breached to allow for dismissal without notice under Just Cause. In Ng v. Canadian Imperial Bank of Commerce, an employee cashed cheques for her husband without waiting for the mandatory clearance period. This money was in essence the banks, and the accused acted as her husband’s banker if even with full knowledge of his gambling problem. The court held that such conduct was in breach of the fundamental principle of trust and violated the core part of her employment, upholding her dismissal under Just Case. Absence from duty: Just case only applies here if several warning on absenteeism have been given without any change. A single incidence of lateness or absenteeism does not call for the application of Just Cause. In the case of Kontopidis v. Coventry Lane Automobiles, Ltd where a manager at a body shop continuously remained absent despite being clearly instructed to let the management know in the event of absence, Just Cause was upheld. It was established that the employee’s absence had negative impact on productivity and further failure to train the nee manager who had been hired jointly met the required benchmarks of Just cause and it was, therefore, proper to dismiss him without notice. Incompetence: This area covers an employee’s failure to perform the core function he is contracted do by the employer. To dismiss without notice on grounds of incompetence, the level of ineffectiveness must be established to be below the bare minimum. This was the case in Matheson v. Matheson International Trucks Ltd., [1984] O.J. No. 306 (H.C.J.) where a truck dealer’s manager was dismissed for Just Cause after failing to handle basic accounting tasks that fell squarely within his job description. An employee can however not be dismissed if they are doing their best but lack adequate skill. But like is applicable in most cases, several warnings on incompetence must have been issued without any sign of improvement. In the Matheson case, the employee ignored the many letters sent to him by the company’s board and did not at any moment give the requested financial information, something that was within his mandate. Employer’s evaluation further gave grounds for dismissal without notice because the employee’s grades in this case were constantly falling so the court stated that he had reason to believe his employment would be terminated. The court additionally mentioned another kind of incompetence following the facts of Matheson’s case which they termed; “Gross Incompetence”. In this latter scenario, the level of incompetence is so grave that an employer may without notice terminate. There is however, need to prove that the level of incompetence was so bad as to warrant dismissal on the basis of Just Cause. Falsification at the time of recruitment: This happens when an employee deliberately misrepresents his skill set at the time of hiring and is therefore employed on the basis of capabilities that they do not posses. Misrepresentation makes the hiring of such an employee null and void abinitio, providing potent ground for dismissal with Just Cause. Sexual Harassment or misconduct: The Saskatchewan human rights Code strictly shield employees from sexual harassment and any allegations to that effected, if validated, are grounds for Just cause where dismissal without notice or payment thereof, is invoked. There is need by an employer to prove that ether are warning systems in place that raised the red flags prior to the dismissal but this does not apply in serious cases. In the Geluch v. Rosedale Golf Assn., Ltd’s case, the employee was additionally accused of having made sexually provocative comments to female employees at the golf club and further poked them in the shoulder, reasons the employer gave to justify dismissal on grounds of Just Cause. The court however established that these reasons were given to the employee four months after dismissal and could not, therefore, justify termination under Just Cause. Collective Events Just Cause: A single case against an employee may not amount to Just Cause but if all the reports of misconduct an\re summed up, they may form grounds for dismissal without notice. An example of such a case was Daley v. Depco International, Inc., where the employee had been serving as an industrial operator for 13 years. During this period, several incidences of misconduct were recorded from fights, drunkenness to incompetence. Given that all the incidences were documented by the employer’s disciplinary system, the courts looked at all the cases and cumulatively agreed that Just cause was acceptable given the numerous nature of the misconduct cases. It was, however, only possible because of the existing disciplinary system that kept proper record of each incidence. Lack of this data would provide no grounds for dismissal by Just Cause. Conclusion Just Cause that allows termination without notice can only be applicable if proper evidence of misconduct is available. To determine reasons for this, solid facts must be presented with specific attention to the areas discussed that include: relationship with employer, level of seniority, nature of misdemeanors and whether there was proper warning from the employer. If it so happens that an employer had in the past tolerated misconduct, then such tolerance cannot be part of the cumulative reason for dismissal. Sufficient proof for misconduct must be presented in all scenarios under Just Cause (Stahl, Björkman & Morris, 2012) The Saskatchewan Human Rights Code outlines strict measures that ensure the protection of workers from possible abuse of Just Cause as a reason for dismissal and employers must, therefore, consolidate their facts before any decision to terminate is reached. With evidence from the Kontopidis v. Coventry Lane Automobiles, Ltd and Matheson v. Matheson International Trucks Ltd cases, employees must also deliver on their part of the contract and can never be protected is there is sufficient evidence of reason to invoke Just Cause (Carter, 2002). In summary, this study has revealed the level of judicial fairness in the Canadian Justice system where facts have been the separator between employers and their workers. The McKinley v. BC Tel case that went all the way to supreme court set judicial precedence on the need to isolate circumstances that constitute alleged misconduct and justice was not only served in this lengthy case, but was seen to have been served. Just Cause, therefore, is fertile ground for dismissal but only if facts are favor of the employer. References Alibekova, A., Campbell, D., & Center for International Legal Studies. (2007). Employment law. Alphen aan den Rijn, The Netherlands: Kluwer Law International. Bamber, Greg. (2010). Regulating Employment Industrial Relations and Labour Law International Co. Kluwer Law Intl. Carter, D. (2002). Labour law in Canada (5th ed.). The Hague: Kluwer Law International Stahl, G. K., Björkman, I., & Morris, S. (2012). Handbook of research in international human resource management. Cheltenham, UK: Edward Elgar Pub. The Canadian abridgment: Case digests. (1966). Toronto: Carswell. Zvulony, K. (2010, December 1). What is Just Cause for Dismissal? Retrieved February 23, 2015, from http://zvulony.ca/2010/articles/employment-law/what-is-just-cause/ Read More