Discipline And Just Cause Termination

If an employee’s employment is terminated “for cause”, the employer has the right to avoid providing “reasonable notice”.

Is there anything I can do? Yes! It is very difficult for an employer to prove termination for cause. Employers need to specifically prove that it is fair and proportionate in the circumstances to deny an employee compensation for termination of employment. While there are many more examples, the following are the kinds of conduct that employers have identified as grounds for terminating “for cause”:

• Fraud or theft;
• Intentional violation of any law or regulation;
• Harassing or abusive towards other employees, clients or customers;
• Continuous failure to perform duties owed to the company (although this generally requires consistent and careful follow up by the employer to try to rectify the poor performance); and
• Certain off-duty misconduct.

While the ultimate decision of whether a termination for cause is appropriate in any specific circumstances would be for a judge to decide, more often than not employees have a good chance of successfully fighting against termination for cause and receiving compensation.

It should be noted that an allegation of cause may not remove an employee’s entitlement to any termination pay or severance. Under the Employment Standards Act (“ESA”), an employee is still entitled to receive termination pay and severance pay (if applicable), pursuant to the ESA, unless the employee is guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and has not been condoned by the employer.

In Ontario, an employer can terminate an employee’s employment for just cause, which if upheld, will deny the employee to common law pay-in-lieu of notice. If the conduct is serious enough and can be categorized as wilful misconduct, disobedience or wilful neglect of duty, the cause could deny the employee their entitlement to statutory termination and severance pay (if applicable).

Common examples of conduct that can support a just cause termination include misconduct, disobedience or incompetence. Just cause is difficult to establish, so employers must be careful to document the conduct that has led to the decision. If an employee feels that his/her employer did not have just cause to terminate their employment, the employee can commence an action for wrongful dismissal or depending on the facts of the case, file a complaint with the Human Rights Tribunal or Ministry of Labour.

If an employer terminates an employee’s employment for just cause, the employee will not be entitled to reasonable notice of dismissal. Additionally, employees who are terminated for cause may not be eligible to collect Employment Insurance (EI) benefits. For this reason, instances of “for cause” termination is serious and require the attention of competent employment law counsel.

It is important to note that “cause” is not the standard that removes entitlement to termination pay and severance (if applicable) under the Employment Standards Act. Under ESA, an employee is still entitled to receive termination pay and severance pay (if applicable), pursuant to the ESA, unless the employee is guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and has not been condoned by the employer.