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Proving cause remains an up-hill battle

Image: www.tylerstrading.com

A recent decision of the Ontario Court of Appeal, confirming a trial decision, once again demonstrates the difficulty employers will face in satisfying courts in this province that there was cause for dismissal.

In a trial decision released in December 2011, the Ontario Superior Court dealt with a case of a 17 year employee at PolyOne Canada Inc. PolyOne is a manufacturer of plastic pellets. The manufacturing process was described as a “complex and potentially dangerous one…” The company had therefore implemented a comprehensive safety program which emphasized what the company called, the “Cardinal Rules”. One of these rules specified that, the machinery had to be “locked out” before any maintenance or repair was done. Locking out prevented the machine from operating. This was done to ensure that it was impossible for the machine to accidentally start while being worked on, which would create an obvious hazard to the workers.

The plaintiff had worked for PolyOne for 17 years and held the position of supervisor. One evening, in order to address performance issues on one of the machines, the plaintiff attempted to clean out the hopper without locking out the machine. As indicated, this was a clear violation of the company’s safety rules, although the evidence at trial established that the plaintiff was never in any actual danger. The plaintiff acknowledged breaching further rules by failing to report the incident as soon as possible. Although the evidence on the actual sequence of events differed between the plaintiff and the defendant’s witnesses, the judge found that, regardless of which version of the events he accepted, the plaintiff’s actions were a “serious violation by a supervisor” of the company’s policies. The court found that the employee’s on going failure to report the error constituted a further breach of the safety rules.

The Judge found that “…the danger of unenforced safety rules in a workplace where heavy equipment operates constitutes a continuing risk;” and, that the failure to report was a more serious breach than the actual safety breach itself.

In spite of the judge’s findings as to the employee’s actions, she was even more critical of the employer’s investigations of the allegations. She criticized the company executive for destroying his notes once the summary of them had been typed. She also disapproved of the fact that various employees who witnessed the incident were interviewed together. It was the judge’s feeling that they should all have been interviewed separately, in order to better assess the credibility of their evidence. She found that the inclusion of the phrase “willful misconduct” in the initial draft of the report, prior to the completion of the investigation, revealed bias on the part of the employee investigating the incident. The fact that there was little difference between the initial version and the final draft further confirmed that bias. Finally, the judge held that the employee should have been given the opportunity to make a full response to the allegations once the employer decided that termination was a possibility. The judge found that the management of the company had been ignorant of a number of the facts that came out in evidence at trial, which facts supported discipline other than termination. Based on the principle of proportionality mandated by the Supreme Court of Canada in McKinley v. B.C. Tel, the judge found that the employee’s actions did not warrant summary dismissal.

However, in spite of the serious concerns over the employee’s conduct, the judge found that summary dismissal was not a proportionate response. The judge based this conclusion on the evidence called by the plaintiff as to how the defendant had dealt with serious various breaches of rules and policies by other employees at the plant. Given this history, the judge felt that summary dismissal was “out of line” with discipline meted out to those other employees. The judge therefore held that the employee’s actions did not constitute cause for dismissal. She ordered compensation of fourteen months’ pay in lieu of notice. It is interesting to note that in determining the appropriate amount of notice, the judge specifically rejects the one month per year rule as being without legal foundation.

The employer appealed the decision on one ground only—that the trial judge erred in relying on one specific incident of discipline of another employee in concluding that the discipline imposed on the plaintiff in this case was not a proportionate response. While the Court of Appeal agreed that the trial judge erred in relying on this one comparison, it still concluded that the dismissal was “not warranted in the case of a 17 years employee with an almost unblemished record.” It therefore upheld the trial judge’s determination of the plaintiff’s entitlement to notice.

What can we take away from the finding in this case? Employers are going to be hard pressed to make out a successful argument for cause for dismissal in all but the most flagrant cases of misbehavior. Employers are well advised, particularly in the situation of a long term employee, to resort to any discipline other than dismissal, up to and including a period of suspension. Such discipline should clearly specify that the end result of the failure to correct the behavior will result in a dismissal. In addition, an employer’s position would be buttressed by a clear policy of progressive discipline, which outlined the implications of specific types of employee misconduct.

Earl Altman
Partner
Garfinkle, Biderman LLP

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Earl Altman

Legal consultant at EA Consulting
Earl Altman was a partner at Garfinkle, Biderman and now heads his own consulting firm. Earl has practiced commercial and employment litigation. Earl’s practice focuses on employment disputes, including acting for employees and employers in wrongful dismissal claims, and in breach of contract and breach of fiduciary duty claims. Read more
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