The generally accepted principle in just cause dismissals is that an employer will have cause to terminate an employee and be absolved from paying wrongful dismissal damages, if the employer is able to prove that the employee’s acts (or omissions) were so egregious that the employment relationship has been fundamentally and irrevocably ruptured.
All “just cause” arguments must first pass through the prism of McKinley v. BC Tel (“Mckinley”).1
McKinley stands for the proposition that an employee’s conduct cannot be viewed in a vacuum but instead, must be walked through a “contextual approach” to determine whether the sanction imposed by the employer is the proportionate response.
There is a two-pronged part to this test:
- first, the employer must prove that the employee committed the misconduct of which the employee was accused;
- then the courts will take a “contextual approach” and decide whether dismissal for cause was warranted under the circumstances or whether a more “appropriate” punishment should have been applied.
In other words, the courts will attempt to strike a balance between the crime and the punishment.
The Thresholds of “Just Cause”
The Ontario Superior Court of Justice has held that the threshold to demonstrate just cause for dismissal is higher under the Ontario Employment Standards Act, 2002 (“ESA”) than it is under the common law.
Under the ESA, an employer has just cause to terminate an employee who “has been guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and has not been condoned by the employer.”3
The “wilful” component connotes a certain mens rea (mental state) element that goes along with the actus reus (action) of the employee in question.4
Plester v. Polyone Canada Inc.5 considered the difference between wilful misconduct under the ESA and just cause at common law, concluding that wilful misconduct is a higher standard.
Wilful misconduct involves an assessment of subjective intent, whereas just cause is a more objective standard.
Wilful misconduct is colloquially described as “being bad on purpose.”
Careless, thoughtless, heedless, or inadvertent conduct, no matter how serious, does not meet the ESA wilful misconduct standard.
By contrast, common law just cause for dismissal may be found on the basis of prolonged incompetence, without any intentional misconduct.
In light of the Ontario Court of Appeal’s decision in Waksdale v. Swegon North America Inc.7, which may have invalidated many commonly utilized termination clauses, this distinction is more important than ever, and employees would be well advised to seek legal counsel or risk being denied any monies that may be owed to them.
Likelihood of Proving Cause
Proving just cause can be difficult for employers. The courts are loath to allow an employer to throw an employee out and pay the employee nothing.
Courts will often find a reason why an employee should receive their due.
To be sure, there are exceptions, but they are exceedingly rare.
Unless an employer has unassailable facts and those most rare commodities – unflagging resolve and money, many employer side lawyers would be doing their clients a favour by saving the time and negotiating them out of the mess by making an offer of severance to the former employee.
That said, let us look at cause for termination generally and a few cases where the dismissal was found to be for just cause.
Grounds for Just Cause
- Theft, fraud, breach of trust;
- Violence;
- Workplace harassment;
- Excessive absenteeism and lateness;
- Lying or evasive conduct during an investigation;
- Insubordination and insolence; and
- Conflict of interest.
While incompetence has been found to be grounds to terminate employment for cause, it is extremely difficult to do so. Courts are far more likely to rule that the employer should have terminated the employee on a without cause basis.
If you have been terminated from your employment, we are here to help. Please give us a call or book a free consultation.
References
1 2001 SCC 38
2 S.O. 2000, c. 41
3 O. Reg. 288/01, sections 2(1)(3) and 9(1)(6)
4 2018 ONSC 7617
5 2011 ONSC 6068, aff’d 2013 ONCA 47
6-1
7 2020 ONCA 391
