The onus (or responsibility) of proving
cause for dismissal of an employee lies with the employer.
Employers should be aware that there is no middle ground
or “near cause.” If the employer cannot prove just cause
on the balance of probabilities, the employee will be deemed
to be wrongfully dismissed and the employer will be responsible
to pay monetary damages arising from the dismissal.
There are certain categories of conduct
which have been recognized by courts to constitute cause
for an employee’s dismissal without notice. These categories
include:
¨
dishonesty (fraud and theft
being examples);
¨
insolence and insubordination;
¨
breach of trust and/or the
duty of fidelity;
¨
conflict of interest;
¨
chronic absenteeism or lateness;
¨
sexual harassment;
¨
serious incompetence;
¨
intoxication at the workplace;
and
¨
fraudulent misrepresentation
as to qualifications/credentials
While the above is not an exhaustive
list of the reasons for a termination with cause, it should
be remembered that any of these reasons must be of such
a degree that the employment relationship is completely
undermined in accordance with the principles set out in
McKinley. Furthermore, if an employer is considering
termination for reasons such as intoxication or drug use
at work, it must be careful not to be in breach of the applicable
human rights legislation, as alcohol or drug addiction may
be considered to be an illness that would trigger the duty
to accommodate.
In each case where dismissal with cause
is being considered, the employer needs to assess:
1)
whether the employee misconduct can be proven; and
2)
whether the nature and degree of misconduct is of
sufficient severity to cause an irreparable breakdown in
the employment relationship, either by violating an essential
condition of the employment contract, or destroying the
employer’s inherent faith in the employee.
There arise certain situations where
there is no doubt the employee must be dismissed with cause,
prime examples being flagrant instances of fraud or theft
from the employer. However, many situations are not so clear
and there is unfortunately no hard and fast method of determining
what will constitute just cause. Two categories of alleged
employee misconduct frequently result in wrongful dismissal
claims, those being:
1)
insolence and insubordination; and
2)
incompetence or poor performance.
These categories are discussed in further
detail.
C.
INSOLENCE OR INSUBORDINATION
“Insolence” has been defined by the courts
as an employee’s derisive, abusive or contemptuous language
generally directed at a superior. Insubordination is defined
as an intentional refusal to obey an employer’s lawful and
reasonable order. In order to successfully establish just
cause for dismissal for insubordination, the employer must
prove the following:
1)
the order must be clear and
specific;
2)
the order must be both reasonable
and lawful;
3)
the order must be within
the scope of the employee’s duties and responsibilities;
4)
the act of disobedience must
be intentional; and
5)
the order is question must
be serious or important in nature.
With respect to insolence, the conduct
must be of a sufficiently severe character that it essentially
destroys the employment relationship. For example, in Wise
v Broadway Properties Ltd.
the employee was a caretaker of an apartment block owned
by his employer. The employee was dissatisfied with his
compensation and in a letter to the employer compared him
to a Nazi in his dealings with employees. The employer was
a Jewish man in his eighties and was deeply offended by
the comparison and dismissed the employee. The dismissal
was upheld at trial and by the British Columbia Court of
Appeal.
However, in less graphic situations,
with respect to both insolence and insubordination, courts
are often of the view that two or more instances of misconduct
are required for cause. The court will examine the gravity
of the offence and may also excuse the employee if he or
she had been provoked. Finally the court will review the
employee’s past history with the employer and will be more
likely to forgive the misconduct if that employee had an
otherwise good employment record.
D. SERIOUS INCOMPETENCE
Incompetence is defined as an inability
to perform basic work functions as required by the employer.
To justify the dismissal of an employee with cause on the
basis of incompetence, the level of incompetence must “fall
below an objective standard of reasonable competence.”
Therefore, to establish cause for dismissal
for lack of competence, the employer must show more than
mere dissatisfaction with the employee’s performance.
The Manitoba Court of Queens bench decision
in Boulet v. Federated Co-operative Ltd.
has become a leading Canadian authority concerning the
factors courts will consider in assessing whether an employer
had just cause to terminate based on incompetence or poor
performance. The leading principles as established in Boulet
are:
1)
The performance of an employee, especially in a management
position, must be gauged against an objective standard;
2)
The employer must establish: the level of the job
performance required; that he standard was communicated
to the employee; that suitable instruction or supervision
was give to enable to employee to meet the standard; the
employee was incapable of meeting the standard, and the
employee was warned that failure to meet the standard would
result in dismissal;
3)
Where the employee’s performance is grossly deficient
and the likelihood of discharge should be obvious to the
employee, warnings and reasonable notice are not required;
4)
While the standard of incompetence to warrant discharge
for cause is severe, the threshold of incompetence necessary
to warrant dismissal for cause is significantly lower where
dismissal is preceded by many warnings indicating unsatisfactory
performance;
5)
In considering whether an employer has provided adequate
warning to an employee, where the dismissal is for repeated
instances of inadequate work performance, the employer must
show: it has established a reasonable objective standard
of performance; the employee has failed to meet those standards;
the employee has had warnings that he or she has failed
to meet those standards and the employee’s position will
be in jeopardy if he or she continues to fail to meet them;
and the employee has been given reasonable time to correct
the situation;
6)
An employer who has condoned an inadequate level
of performance by his employee may not later rely on any
condoned behaviour as ground for dismissal;
7)
Condoned behaviour is relevant if the employee fails
to respond after appropriate warnings. Condonation is always
subject to the implied condition that the employee will
be of good behaviour and will attempt to improve.
Any employer considering dismissing an
employee with cause for incompetence and poor performance
should carefully consider these factors prior to making
a final decision.
E. PROGRESSIVE DISCIPLINE AND THE EMPLOYER'S DUTY TO WARN
The concept of progressive discipline
has existed in unionized settings for many years. The purpose
of progressive discipline is to give employees the opportunity
to “learn from their mistakes” before more severe penalties,
such as dismissal, are imposed.
Given the difficulties faced by employers
in proving cause in certain situations, it would be advisable
for employers to consider implementing the practice of progressive
discipline prior to imposing the ultimate penalty of dismissal
with cause. Employers may be able to save themselves from
large damage awards and legal fees by maintaining and adhering
to disciplinary procedures which would typically include
the following four step sequence:
¨
verbal reprimand;
¨
written reprimand;
¨
suspension without pay; and,
finally
¨
termination.
The implementation of a progressive discipline
program will assist the employer in proving that it has
done all it reasonably could to rehabilitate the employee
prior to taking the final step of dismissal. The reasons
for the discipline and the punishments meted out to the
employee should be carefully recorded on the employee’s
personnel file. In the event of a wrongful dismissal action,
such evidence will be invaluable to prove that the employer
acted properly.
Further, prior to taking the step of
dismissing an employee for cause, there are numerous situations
where it would be appropriate to issue a warning to the
employee that dismissal will result if the improper behaviour
is repeated or, in the case of incompetence, the level of
performance is not met. There are numerous judicial decisions
which have emphasized that the employee had been wrongfully
dismissed for cause because the employer failed to adequately
warn the employee that the conduct complained of was inappropriate
and could result in dismissal.
F.
CONCLUSION
Given the serious effects
on an employee’s career and livelihood that a dismissal
for cause may entail, courts in Canada impose an onus on
the employer to prove the existence of cause. Given that
onus of proof, and the potential cost to the employer of
“getting it wrong,” prudent employers should review employees’
performance regularly, pointing out and documenting deficiencies,
and provide employees with opportunities to improve.
Most importantly, employers
need to make sure that employees, whose conduct is considered
to be improper, be provided a warning in writing stating
that they have failed to meet the employer’s reasonable
objective standards of performance or appropriate standards
of behaviour, as the case may be. The warnings should provide
clear notice that the employee’s position will be in jeopardy
if the standards are not met, or if the inappropriate behaviour
should continue. In the absence of such steps being taken
by the employer, the task of proving to a court that the
dismissal for cause was correct will be an uphill battle.
The costs of implementing these protective measures are
not high, but the costs of ignoring them may be substantial.
