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Delayed termination of employee sometimes weaken position for just cause dismissal

We cannot continue to tolerate John’s misconduct, and we have decided to dismiss him for cause… once we get through the trade show next month.”

Famous last words? Well, they will certainly weaken the position that just cause for dismissal existed in the circumstances. If an employer truly believes that they have just cause for dismissal, the employee should not be permitted to continue working, as that is entirely inconsistent with the notion that the employer could not continue to keep the employee on.

I have discussed summary dismissal many times in various forums, and I will not review the law in detail here. However, I want to address this somewhat common occurrence where employers make the decision to fire an employee for cause, but hold off on doing so until it is convenient for them. Simply put, it is a mistake.

The fundamental basis for dismissing an employee for cause is that the employment relationship has been irreparably harmed, and the employer cannot possibly be expected to continue employing the individual in question. In many cases, this is at least partially based upon the assertion that the required degree of trust no longer exists. If you intend to take the position that you could not trust the employee anymore, how can you justify allowing them to continue working, representing the organization, or handling sensitive matters?

As discussed elsewhere, the threshold is high; summary dismissal is often referred to as the “capital punishment of employment law”. While courts and arbitrators will agree that in some cases, summary dismissal is warranted, it is not an easy burden to meet. Allowing the employee to continue working for a period of time after the decision has been made because there will be a time when it is more convenient to let them go is an easy way to sabotage your case. After all, how compelling will it be when you advise the court that, given the circumstances, you could not possibly continue to employ the individual, when the evidence reveals that you allowed them to continue working for days or weeks after you discovered the misconduct and made the decision to dismiss?

The case Soost v. Merrill Lynch Canada Inc. is a good example of this mistake. The employer sought to justify dismissal of a star financial advisor based upon his failure to abide by various policies. During the course of trial, Merrill Lynch argued that it could no longer trust Mr. Soost and therefore had just cause to dismiss him. However, this position was contradicted by the fact that Merrill Lynch waited weeks to dismiss Soost after the decision to do so had been made. As the Court stated:

[114] But most significantly, in my view, is the fact that despite having reached a consensus after the April 26th meeting that Soost had to go, and within days to dismiss for cause on May 4th, the Defendant waited until May 18th to execute its decision to terminate. That delay suggests to me that whatever faults the Defendant thought Soost had, they were not sufficient to justify immediate action. And if that is so, there is no reason why the Defendant could not have given Soost some notice of his termination. The suggestion by Merrill Lynch that it could no longer trust Soost or had questions about his honesty were clearly not so profound or pressing as to cause it to immediately terminate him once it had reached its decision. Instead, it waited almost two weeks to do so.

So what should you do? First, if you suspect misconduct, it will often be advisable to suspend the employee with pay while you investigate. Investigate fairly and thoroughly. Then, if the decision is made to dismiss the employee for cause (hopefully with the advice of an employment lawyer), do so immediately. Do not allow the employee to continue working until the next big event is complete, or the busy season has ended, or their replacement has been trained. Doing so will expose you to extensive cross-examination and, ultimately, a likely finding by the judge that your very own actions contradict the assertion that summary dismissal was warranted.

Stuart E. Rudner
Rudner MacDonald LLP
Canadian Employment Law

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Stuart Rudner, Rudner Law

Employment Lawyers and Mediators at Rudner Law
Stuart Rudner is a leading HR Lawyer, mediator and a founding partner of Rudner Law, a firm specializing in Canadian Employment Law. At Rudner Law, their approach is simple. They want to understand your circumstances, your concerns, and your goals. They will then ensure that you understand the legal regime along with your rights and obligations. Once that is done, they work with you to design a cost-effective strategy that meets your needs. They want to be your trusted advisor.Read more
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