Cause…or No Cause? The Ins
and Outs of Terminations for
Cause
David Greenwood
Melanie Francis
416.593.1221
The information and views expressed in this presentation are for information purposes only and are not intended to provide legal advice. For specific advice, please contact us.
Blaney McMurtry LLP - 2 Queen Street East, Suite 1500 - Toronto, Canada
www.blaney.com
What exactly are you doing when
you terminate for cause?
 Employees in Canada are entitled to reasonable
notice of termination, or pay in lieu there of
 In terminating for cause you take away that
general right – the employee is no longer
entitled to notice
 In terminating for cause you are saying the
employee’s conduct equals a fundamental
breach of the employee’s obligations to you as
an employer; the employee has essentially
repudiated the contract
How do we know there has been a
fundamental breach?
 the employees conduct interferes with the safe
and proper operation of your business
 the employment relationship would be
impossible to continue - it is too fractured or
has been irreparably harmed
 the conduct was incompatible with the
employee’s duties
Types of behaviours that might
result in a fundamental breach








Dishonesty
Theft
Insubordination
Sexual Harassment
Absenteeism or lateness
Workplace conflicts
Alcohol and drug use
Off the job conduct i.e. criminal activity
If this seems too easy…it is
 Not all employee misconduct treated equal
 We can not simply take a behaviour from the
previous list and terminate any employee that
engages in that type of behaviour
 In Canada, whether you as an employer have
just cause to terminate is based on more than
just an examination of the employee’s
behaviour
Why do we look beyond the
behaviour?
 Take theft as an example….
Theft cont.
 Employee steals $200 worth of materials from
the plant where he works
 If any theft may result in just cause for
dismissal, the employee would be terminated
 But, what if those materials were scraps,
destined for the garbage? And the employee, a
20 year employee with no previous discipline?
McKinley v BC Tel, 2001 SCC 38
 Supreme Court of Canada decision setting the
parameters for just cause
 Factual background of case
Mr. McKinley employed by BC Tel for 17 years
Medical issues required him to take a leave of absence
Upon return from leave he requested less stressful position
BC Tel refused accommodation request
Prior to trial, BC Tel learned Mr. McKinley had been
dishonest about his medical condition and his ability to work
 BC Tel abandoned its defence of frustration and argued it
had just cause to dismiss Mr. McKinley based on
his dishonesty





McKinley cont.
 At trial, the judge instructed the jury to
consider the extent of Mr. McKinley’s
dishonesty, in order to determine whether
dismissal was warranted
 On appeal, the BC Court of Appeal took an
opposite view, stating that dishonesty equals
cause and that this cause is not founded on the
degree of dishonesty
 The Supreme Court of Canada had to determine
which approach was appropriate
Alleged misconduct must be
viewed contextually
 The question is, in the circumstances, is the
behaviour such that the employment
relationship can no longer subsist
 Factors to consider:








Employee’s position
Nature and degree of misconduct
Single incident or repeated pattern of behaviour
Employment history
Acknowledgement of the misconduct/apology
Willful vs. accidental conduct
Issues regarding the investigation itself
Proportionality
DRUNK & INCOMPETENT:
THE HALLMARKS OF ANY
SUCCESSFUL ORGANIZATION
NEVER CRY OVER TAKING EXPIRED MILK
EXOTIC DANCERS ANYONE?
XXX
GET THE RAISE YOU REALLY WANT!
BUILDING CLIENT RELATIONSHIPS:
A LESSON FROM MIKE TYSON
IF IT LOOKS LIKE A DUCK AND
QUACKS LIKE A DUCK…IT MAY
NOT BE A DUCK
Summary
 The point isn’t just whether the employee did
what is alleged (although that will have to be
proven as well)
Proactive Steps
 It can be difficult to successfully terminate an
employee for cause
 But having the ability to terminate for cause is
an important element for most organizations
 Ensures proper functioning of the organization
 Prevents morale from being negatively affected
by a difficult employee
 That’s why it is important to take proactive
steps
Proactive Steps
 Clear organizational policies with respect to
acceptable behaviour
 But, keep in mind policies cut both ways
 Clear protocol for disciplining employees
 Regularly scheduled reviews
 Document, Document, Document