Wednesday, January 19, 2011

Just cause dismissals

There is an interesting debate going on in the Edmonton Journal over the concept of just cause dismissals. Loosely, the doctrine of just cause says that employers who terminate the employment of a worker must provide reasonable notice (or pay in lieu of reasonable notice) unless the worker has done something so terrible that it is irreconcilable or inconsistent with continued employment and thus warrants immediate termination.

So if your employer catches you stealing, the employer knows you can no longer be trusted and out the door you go. On the other hand, if you make a mistake that isn't fatal to a continuing employment relationship, the employer must discharge you with notice or work with you to correct the error (a progressive discipline approach). Repeated failures to address the issue might then lead to a just cause termination.

Employer-side lawyer Howard Levitt, in an article originally printed in the Financial Post, suggests that the requirement that employers have just cause for terminating an employee is troublesome:

"The just cause requirement is one way unions erode the employer's control over the workplace. In a non-unionized workplace, the employee could be fired without any doubt or appeal. If there wasn't just cause for his dismissal, he would only receive severance pay."

This is partly correct. In a non-unionized workplace, an employee who has done something objectionable (but which does not meet the just cause standard) might well get let go with notice (or pay in lieu). More likely, though, the employer would simply fire the worker. If the termination was without cause and if the worker sought assistance through a provincial employment standards processes, the employer might well be on the hook for a few weeks of pay.

A worker with more resources might sue for wrongful dismissal and may, after a lengthy court battle, get a more generous settlement. But most of that will go to their lawyer. In effect, most workers under a common law contract of employment have few realizable rights in the event that an employer wants to terminate them--no matter how arbitrary or unfair the termination was.

Because of this (and other) examples of the power imbalance in employment, many workers have chosen to join unions and bargaining collectively. A significant difference between union and non-unionized employment is that, with a union, the remedy for an unjust termination is reinstatement (with backpay) rather than pay in lieu of notice.

This does, certainly, limit the employer's control over the workplace--arbitrary and unfair behaviour by the employer which significantly damages the worker is remediated more fully. Indeed, the threat of a meaningful remedy can well compel employers to act more carefully. This is the crux of the Alberta Federation of Labour's response.

The strategies Levitt suggests for handling just cause dismissal (when maybe the case isn't entirely open and shut) in unionized workplaces provide fascinating insight into the political economy of employment. He encourages employers to attempt to trap employees into conflicting statements of responsibility so as to undermine their credibility. He suggests carefully recording common and minor errors to create a pattern of misconduct to present to the arbitrator. And he suggests suspending a worker without pay so the worker starts to feel the pinch (and may even have found another job) and is thus more likely to accept a termination package.

None of these tactics is illegal. And they are all a rational way for an employer to advance its economic interests. That they come at the expense of the employee elicits no comment or consideration. Perhaps this lack of regard for the interests of workers is why workers often seek protection of a union?

-- Bob Barnetson

11 comments:

  1. Bob,

    Thank you for your analysis into this under-reported story. I have been watching it with fascination.

    One thing you briefly mention but might deserve expanded comment is that Levitt's article implies that "just cause" only applies in unionized environments. Take this quote: "Where employees are represented by a union, the employer must show it had just cause to fire the employee."

    This is true in a narrow sense, but implies that in non-unionized environments such an obligation does not exist. Which it does, as you point out. However, it should be noted that Mr. Levitt is a lawyer, and is fully aware that just cause is a principle of employment at common law. I will not attempt to assume Mr. Levitt's intentions, but the choice of wording is odd.

    Maybe I misinterpret Mr. Levitt's intentions here. However, it is rather careless wording, at best. A lawyer should know better.

    Just a thought.

    Jason

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  2. Is my employers allowed to terminate me if I am on doctors leave with a left hand injury. I am doing therapy for my hand and should be able to return to work in about 5 weeks. I have updated my employers on my status a few times and they sent me a text saying my job was no longer available for me>

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    1. I'm not a lawyer and I don't give legal advice. Broadly speaking, Canadian employers have an obligation (under human rights law) to accommodate temporary or permanent physical disabilities to the point of undue hardship. Your recourse (assuming you are not a unionized worker) is to contact your provincial human rights agency and query about how to file a complaint. This will be slow and tedious. In the meantime, you are best advised to (1) seek other employer and (2) file a claim for employment insurance. Do not lose the text your employer sent you as that is evidence for both human rights and EI. I hope that is helpful.

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  3. Hello, great article! What are the expectations around getting my pay check in Alberta since I was fired under probation with no notice or pay. Do they have to get it to me within a certain time period?

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    1. Thanks for your note Megan; apologies for the delay; the university is closed over the Xmas break. Alberta requires the employer to pay you any owed earnings within 3 working days if they terminate your employment.

      You can read more about this here: http://work.alberta.ca/documents/Payment-of-Earnings.pdf

      You can trigger enforcement by calling the Employment Standards call centre at 1-877-427-3731 (toll-free) (note they are closed until January 2, 2017).

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    2. Thanks, good to know! They took a good long time to get me my check... and they stiffed me a few weeks of tips. Is there anything I can do??!

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    3. Again, I suggest that you contact Alberta's employment standards contact centre to find out your options around tips.

      In terms of the delay, most employment laws centre on remediating the error rather than punishing the employer. Given that the employer paid you (however late), it is unclear to me what further remedy employment standards might provide.

      Of course, if you know that the employer engages in practices that violate the employment standards code, you might flag that for employment standards and ask them to investigate (which, if nothing else, will be a huge pain in the ass for the employer).

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  4. Hi, anyone here a lawyer? I need advise. My husband was terminated for what they say "just cause". He was involved in insurance fraud allegation. He was new working in the company when this co-worker asked him if he had made claims on massage. My husband being naive, gave this guy his insurance log in infos. He honestly thought that he will get appointments for massage etc... then he found out a money was deposited into his account because the guy made claims in his behalf. Then he was asking for half of it and said, easy money huh? This guy eventually get fired because he apparantly is doing that same tactics with others, and othets knew because they do it several times. This guy also changed the bank info in my husband's account and all the claims he did, at one time amounting to $900 were stolen from him.

    Now there has been investigation in the company and from the insurance. He and other seven people were being investigated and talk to. My husband was fired, while others, were given second chance. I don't think this is fair. My husband is being singled out.

    Pls help. What should we do?

    Thanks.

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    1. Sofia, I' not a lawyer and thus cannot give you legal advice. I see you have two main options: (1) accept the termination and move on or (2) seek legal advice about your ability to contest the termination (perhaps seeking pay in lieu of notice for the termination). Much will turn on the jurisdiction you reside in and the specific facts of your husband's situation. Best of luck moving forward.

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  5. Hello - looks like this blog is still active, hoping to get some advice.

    My wife was terminated from her company today, after returning from maternity leave 3 weeks ago, and after working for her company for 4+ years.

    She was working part time for the past 3 weeks, and it was plain to see that her employer had no real plan for her return to work. She was sent around to different offices, not provided a real schedule of work, and was sent home early a couple of times because there was no real work to be done due to overlapping staffing at the offices in the same role.

    The office which she was initially posted at upon her return from leave was only open for 1 week after her return due to scheduled restoration activities (there was a leak and the office needed to be cleaned up). That office is temporarily closed for the restoration activities. However; the entire group of staff at that office was also terminated a few days ago, including the main dentist. They all received severance pay.

    At her dismissal meeting today, the reason for dismissal given to her was "multiple complaints from other staff, that she was abrasive and difficult to work with". This was the first time she had heard of these complaints. There was no prior warning and no substantiated proof of these complaints given. There was no opportunity for correction of behaviour. I'm fairly certain that in the 9 working days she had after her maternity leave, she could not have aggravated that many people, considering her relations with her colleagues before her maternity leave were quite good.

    This dismissal is especially difficult for us because she was working to gain enough hours for a second maternity leave. Her employer knew that she was pregnant before her dismissal.

    My questions are:
    1) If she receives severance pay, does that mean she was dismissed through no fault of her own?

    2) Can she receive employment insurance? Or is she ineligible due to the "complaints" received against her? How would her employer need to prove "just cause"?

    3) Although the reason for dismissal was not pregnancy related, would the actions of the employer upon her return to work create a human rights case for her? Her job was obviously not protected from her maternity leave. Yes, technically she worked for 3 weeks and was then terminated for an unrelated reason - but it just seems so strange. There was no job stability, no plan, nothing.

    4) What recourse do we have for this situation?

    Thanks for your help.

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    1. Thank you for your note. I’m not a lawyer, I don’t give legal advice, and things differ from province to provinces. I am happy to walk you through the questions you have.

      1. Terminations can be for cause (employee did something wrong, no notice or pay owed) or non-culpable (no employee misconduct, employee gets notice or pay in lieu). Sometimes employers will give notice or pay even if there was misconduct in order to avoid a wrongful dismissal complaint. And sometimes they will shit talk a worker in an entirely non-culpable dismissal (perhaps to make the worker fear for her reputation or be less likely to advocate her for interests).

      My guess would be that, if your wife got money, it was non-culpable termination. The employer should have provided a record of employment (ROE). An ROE will include a reason for termination (usually a letter code with the legend on the back of the ROE).

      2. You wife may be eligible for EI. It depends on the reason for dismissal on the ROE and whether she has adequate weeks of employment to qualify. On the issue of weeks of employment, that she just came back from mat leave may be an important factor in the calculation of eligibility. I would contact Service Canada, and explain the circumstances: servicecanada.gc.ca 1-800-206-7218 If you are eligible, you can file for EI online.

      3. Whether the termination was related to your wife’s mat leave and/or current pregnancy is really the key question here. You should phone your provincial human rights office and query this. An employer is not usually required to keep a staffer on if there is legitimately no work. That said, the employer cannot discriminate against a women who is or was pregnant on that basis.

      The whole deal (the shuffle around offices, lack of work, getting sacked with no real warning, getting severance when there was an allegation of poor performance) all totally causes my spidey sense to tingle. This looks like an employer who doesn’t know much about HR trying to shuffle an employee out the door.

      4. Besides filing a human rights complaint, you may have recourse through the courts. This depends on how much severance you got. Most provinces set out a minimum notice period for non-culpable terminations in their employment standards or labour standards law. But, an employee is terminated without cause is entitled to both minimum statutory notice and common law reasonable notice.

      Reasonable notice (or pay in lieu of notice) is typically longer than minimum notice unless the employee has signed a contract equating the two (you may wish to look in any employment contract your wife signed about severance or termination pay. Assuming the contract is silent (or there is no contract), simply paying the employee minimum notice does not insulate the employer from a wrongful dismissal claim for reasonable notice.

      Whether suing the employer is worthwhile is a tough call and you should really consult a lawyer. With only four years of service, you might not get much more than the severance. Although the hinkey stuff about your wife being pregnant again and the potential for reputational harm for the employer might shake loose some extra cash.

      Beyond that (and an EI claim), you wife’s best bet is to look for new work to try and mitigate the lose. Best of luck!

      Bob

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