Dismissal For Cause in Canada – 5 Things You Must Know

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This lecture explains the fundamentals of the law of dismissal for cause in Canada. It provides examples of some of the circumstances when dismissal for cause is justified and provides an insight on an employee’s rights on termination for cause.

This lecture is taught by Amer Mushtaq, LL.B., M. Engineering , B.Sc. (Hons.), who is the Principal and Founder of the law firm, Formative LLP. Through his YouTube channel, YouCounsel,

Amer shares practical advice from his years of legal experience to help anyone access justice and achieve their goals. Subscribe today to learn more.

Amer also offers in-depth courses (by paid subscription) on various legal topics through http://www.youcounsel.ca/.


Show Notes:


Lecture Slides:

Machine Transcription:

Welcome everyone.  This is Amer Mushtaq from YouCounsel.

Today we’ll talk about the law of Dismissal for Cause in Canada.  We’ll cover some basic topics so you can understand the fundamentals of this concept.  Essentially, dismissal for cause occurs when an employer believes that an employee has done something wrong and and he or she deserves to be dismissed immediately from employment.  We will begin with the usual Disclaimer that this course is not legal advice.  If you have any specific questions, you must contact a lawyer or paralegal.

What is just cause for dismissal?  It is essentially an employee’s misconduct.  The misconduct is so bad that the employee deserves to be terminated immediately.  When a court is making a decision about whether a particular dismissal was justified as “just cause” or was it a “wrongful dismissal”, the court considers the circumstances in a contextual way.  It’s called the contextual approach.  This is something that you want to keep in mind.   What I mean by that, I will explain with an example.  If an employee was employee for about fifteen years with a stellar record, i.e., no disciplinary issues and one day the employee ends up disobeying his or her supervisor or manager or speaks improperly (in a derogatory manner) or something like that (which is completely out of line with proper employee conduct), does the employer have a right to dismiss the employee for cause?  The employer may think that this one incident is sufficient to dismiss for cause.  But when the court is looking at this conduct, the court is going to look at the entire fifteen years of record to see how the employee behaved in fifteen years, what kind of conduct he had with his managers and other employees and what not and the specific circumstances of this particular incident and then decide whether the decision to terminate him for “cause” was justified or not.  It’s a contextual approach and looks into a variety of circumstances before a decision is made. 

One thing you want to remember about dismissal for cause is thatit is considered the capital punishment of employment law.  In other words, what an employee has done is so bad—is so egregious, so heinous that he deserves the highest punishment.  In employment law, it is dismissal for cause.  These are not sort of small incidents of misconduct, but something that is really, really harmful, something really egregious.  In majority of circumstances, where the employer actually claims dismissal for cause when the cases are tried in court, majority of the time, the court does not find a dismissal for cause—unless the conduct that was alleged was so egregious that it deserved dismissal for cause. 

We’ll talk about it in a bit more detail by giving you some examples.  Let’s get into five things that I have indicated that you may want to keep in mind—(1) what happens to an employee’s rights when he or she is dismissed for cause?  Keep in mind, that when an employee is dismissed for cause there are No termination rights and No post-termination rights.  He or she does not get any termination rights,  termination pay, severance pay—nothing—no severance, no common law reasonable notice that employees without cause termination may be entitled to.  The terminated employee for cause does not get any of those rights.  The employee is not even entitled to employment insurance because it’s a dismissal for cause.  What you want to keep in mind is that (a) there are no post-terminations rights but the pre-termination rights are intact.  What I mean by that, is whatever salary, benefits, commissions, the employee has accrued up to the point of termination, he or she will still be entitled to that. He or she will not be entitled to any rights post-termination. Point number (2) Single incident: what I mean by that is whether a single egregious incidence of misconduct amounts to dismissal for cause? and the answer is yes it could be sufficient.  Going back to our example of the 15 years service employee who conducted himself improperly.  Let’s take that same employee who had a stellar record for fifteen years and then at some point in the present he steals a large amount of money from the employer.  That may be sufficient grounds, despite his or her fifteen year good conduct, to justify dismissal for cause. 

In majority of the cases, when somebody has worked for such a long time and has had no disciplinary issues or had no misconduct issues of that nature, then it’s unlikely that he or she will be found to be an employee deserving of dismissal for cause.  The point that you want to remember is that a single incident can amount to dismissal for cause.  You want to keep that in mind.  Violence at work—a significant violent issue at work may justify a dismissal for cause.  (3) What about infractions that are accumulated?  I want you to understand that there could be a series of incidents. I can quote an example.  For instance ongoing absenteeism or coming late to work or leaving early from work—if this kind of behavior is ongoing for a long time, and an employer has been issuing warnings and the employee has not been heeding all kinds of warnings—all this may cumulatively amount to dismissal for cause.  The employer may be justified—just because the infractions are not too significant but the fact that they have been repeatedly happening and the employee may have been receiving warnings for that, then that may amount to dismissal for cause as well.  (4) What about progressive discipline? And we get this question often when an employee is terminated for cause and he or she comes to us and states that he/she had never received any warnings or any suspensions and therefore the employer is not justified in terminating the employee for cause.  That may not always be the case.  Progressive discipline is not necessarily a prerequisite to termination of cause, it depends on one of these factors: (a) it may depend upon the employer’s workplace policies.   If the employer has workplace policies that require the employer to issue warnings and require the employer to provide progressive disciplining to the employee before terminating him/her, then you may have an argument that progressive discipline was a prerequisite.  Generally speaking, prior warnings or previous suspensions are not required.  It really depends upon the conduct.  The court is looking at the entire context of that conduct to decide whether the dismissal is justified for cause.

Let’s talk about some of the examples of just cause dismissal: (1) stealing or embezzling money from employers, obviously, is an example of where the dismissal for cause would be justified; (2) violence and workplace harassment including sexual harassment of co-workers or other people; sometimes violence and harassment outside of work may lead to dismissal for cause from employment; (this is an area that’s constantly changing and expanding and one needs to be mindful of that); (3) disobedience: of lawful orders may amount to dismissal for cause (4) discrimination with coworkers or other employees or the employer may cause dismissal on just cause basis.

Some of the examples where dismissal may not be justified are (1) performance issues: a lot of times we get cases where the employer has terminated an employee for just cause because the employee could not meet the performance matrix. I can tell you in majority of the cases that performance is not considered an element of just cause dismissal.  Performance is something that the court believes that the employer has a job to do due diligence to make sure that they have hired an appropriate employee who is able to perform based on their requirements. If they are unable to meet the employer’s standards then the employer can terminate them without cause but terminating with cause is not something that’s commonly acceptable.  (2) what about meeting targets? now a lot of companies provide certain target e.g., sales ( targets for objectives) that an employee must meet.  When the employee is not able to meet those targets, sometimes the companies try to terminate the employee for cause.  That’s also not generally acceptable.  The court will consider that the employer can terminate the employee without cause but not meeting targets is generally not considered grounds for dismissal for cause.

Other minor infractions for which I can give you different examples are: occasional coming to work late or actual occasional absenteeism which sometimes may be justified, sometimes may not;  rude behavior with your coworker, occasional rude behavior or with your superior—these kind of things – the mistakes that are sort of human mistakes that may happen just because of being in workplace and working with other people.  Those may not amount to just cause dismissal if somebody is not a well-liked person, based upon his or her behavior with others then the employer has always this inherent right to terminate an employee without cause and that’s the direction that the court prefers the employer to take.

What you want to keep in mind about dismissal for cause: is that it is the capital punishment of employment law world: someone has to have some done something so bad, so egregious that the without cause dismissal is not an appropriate remedy and they must be terminated with cause.  2nd  thing you want to keep in mind is that the approach that the court takes is contextual.  They look at a number of factors in deciding whether in the specific circumstances of that case the dismissal for cause was justified or not.  If you’re ever faced with “dismissal for cause” my suggestion is to contact an employment lawyer and have them review your circumstances.  They can advise you whether you have a case for wrongful dismissal or not. 

Hopefully this helps you understand the fundamentals of dismissal for cause.  If you need an explanation of any points or you have any other things that you want us to talk about, by all means contact us and we’ll be happy to add it in our future lectures.  Thank-you for watching.

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