Trevor R. Thomas
Wrongful dismissal claims are a common subject in employment law, but what actually constitutes a wrongful dismissal? To avoid dispute, we encourage employers to communicate their end-of-job policies to all employees, and for employees to learn their rights and entitlements when it comes to dismissal.
What Is an Employee Entitled to at the end of a Job?
An employee who is being let go is usually entitled to a certain amount of prior notice, or an equivalent amount of pay, when asked to vacate their position. The maximum amount that a BC employee can be legally entitled to under the Act is eight weeks of notice or eight weeks of pay. However, the general upper limit at common law (generally, the law based on the decisions of the courts) is 24 months!
The biggest determiner for how much an employee is owed when they are being let go is the length of their employment at that company. Length of employment and amounts owed are broken down as follows in the BC Employment Standards Act:
Duration of employment Amount owed
< 3 months No notice, no amount of pay
3 months to 1 year 1 week notice or 1 week’s pay
1+ years 2 weeks notice or 2 week’s pay
3+ years 1 week of notice or pay per year of employment, capped at 8 weeks
While only one or the other (notice or pay) is required by BC law, some employers choose to give departing employees a combination of some notice and some pay. For example, an employee that has been at the job for four years might be given two weeks of notice along with two week’s severance pay.
We always recommend that employers make this information available in an employment contract that would be reviewed and signed by the employee at the time of hiring. Clearly communicating end-of-job expectations goes a long way toward easing the stress related to a termination.
In a lot of cases that we see, however, employees do not have written employment contracts. In these cases, the Employment Standards Act is helpful. The above table of entitlements applies to all employees whether or not they have a written contract. However, only with a written contract can you really limit severance to the minimums of the Employment Standards Act.
When it comes to more complex disputes, it’s helpful to look at BC common law. Examining the outcomes of similar cases can help build a framework by which we can consider all the factors at play in a wrongful dismissal case — things that might place an employee at more of an advantage or disadvantage. For example:
The employee’s age
Their role in the organization
How long we would expect it to take this employee to find a new job, factoring in extenuating circumstances like a pandemic, or preexisting health conditions
What is the Process for Letting Go of an Employee?
We often see questions like this from employers who have never had to fire an employee, and are looking for guidance on how to do it correctly.
When you’re holding a termination meeting, you want to make sure you’re prepared in advance. Always have your documents in order before you begin the process.
Documents to prepare might include:
A letter of termination
A release document (in cases where you might be offering an employee additional severance pay)
A record of employment
A draft reference letter
The general purpose of a termination meeting is to go over all these documents and provide the employee a chance to ask questions. It is to ensure that you and the employee are on the same page and any potential issues can be addressed before they become significant claims.
Do You Need to Tell an Employee Why They’re Being Let Go?
It’s common for companies to offer a general reason for a termination, particularly if the termination is due to factors that are not directly reflective of an employee’s performance. For example, downsizing, restructuring, or budget cuts. And, of course, most employees will want to know why they are being let go. That said, there is no legal obligation for an employer to provide a specific reason for a termination (the exception is a situation where the employee is being let go for “just cause”. In such cases, an employee has engaged in severe misconduct such as fraud, theft, or physical violence in the workplace, and therefore has a legal right to be informed of the reasoning).
When is a Claim Against an Employer Justified?
If the employer has not abided by the above laws and procedures when firing an employee, then that employee may be entitled to file a claim against that employer. What type of claim will depend on the details of the situation.
In BC there are three general categories of claims that we frequently see:
Claiming Compensation Owed
This is a relatively common claim, and one that can usually be easily resolved. Claims like this occur when an employee has not received the notice or severance pay that they were owed upon termination. For example, if an employee had been working at a company for four years and was given two weeks of written notice but no amount of pay, they could file a claim for two week’s worth of severance pay from the employer.
Through the Employment Standards Act, this is a pretty straightforward process. Employees can submit complaints through the Employment Standards website. We usually encourage people to try to resolve these issues independently, because often the amount of money that’s owed is not large enough to offset the expense of hiring an employment lawyer.
Claiming Wrongful Dismissal
Wrongful dismissal claims tend to have overlap with claims of insufficient notice or compensation, as well as human rights complaints. Generally a wrongful dismissal or wrongful termination just means that the employer did not follow the correct process for terminating an employee. In some cases, an employee may be owed additional pay, or there may be an issue where the employee feels that they do not deserve to be let go — for example, if they are being let go due to a health issue, disability or other potential Human Rights ground.
Perhaps an employer lets go of an employee with minimal notice and no severance pay, citing consistently poor work performance. The employee, however, believes that they were wrongfully dismissed, because they were under the impression that their performance had been good, or they were never informed of their poor performance or given an opportunity to correct it.
In such a case, you could file a wrongful dismissal claim. To do so, you’ll need to prepare some proof that the employer was in the wrong when they fired you. An employment contract and a termination letter are a good place to start. Then, in the case of the above example, if you were fired for apparently poor performance, then you would need proof that the employer had given you feedback on your performance at some point. This can mean records from performance reviews, or any communication with your employer (such as emails) that shows discussion about your performance.
Human Rights Complaints
The other thing to be mindful of when terminating an employee is human rights concerns. For employers who are considering terminating an employee, it’s important to consider any health issues that have been disclosed by the employee that might have affected their performance or caused them to act a certain way at the workplace. If an employee is indeed suffering from a health issue that is causing them to underperform, then if they are let go because of that, they may be able to file a human rights complaint.
Say someone worked at a company for four years. They had a mental health condition that was fully disclosed to their employer at the beginning of their employment. In this case, the employee performed their job adequately for a while, but after two years, they experienced a downturn in their mental health which negatively impacted their work performance. Despite the employer’s prior knowledge of this employee’s health issue, the employer chose to terminate the employee after a period of poor work performance, offering them no pay and no working notice.
For human rights complaints, an employee can hire an employment lawyer or file independently through the Human Rights Tribunal website. It’s always important to consider the cost of hiring a lawyer versus the potential for compensation. We encourage individuals to try to file claims independently and resolve these issues themselves, but we do also see situations where a claim that seemed simple at first evolves into a more complex case. If a case becomes too complex to be resolved on the individual level, even seeing a lawyer for a brief consultation might help you better understand what you can do.
The Bottom Line
One of the things to keep in mind, and one that we hear all the time, is that the process of letting go of any employee can feel impersonal, and can be very emotionally taxing. We like to recognize that all of our clients are human beings and deserve to be treated as such, and we encourage employers to take the same attitude. Too often we see employees who are fired and feel as if they are being treated as meaningless to the company.
It’s always best to approach the termination process with a sense of humanity. An employee being let go is losing a significant part of their life and livelihood, so be aware of that, and be thoughtful. Understand that you are altering this person’s future. Open dialogue between an employer and employee throughout the duration of a job and during the end-of-job process is a significant way to reduce the stress burden on the employee, and ensure that any potential disputes are resolved before they can snowball. There’s the law, and then there’s treating people like people.
Get in touch with us to discuss!