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Terminating an Employee for Cause

August 3, 2021

In BC employment law, there are two broad categories of terminations: “for cause” and “without cause.” Without cause doesn’t mean that there was no reason for an employee to be let go, rather that the employee is still entitled to a number of weeks of notice, or an equal amount of severance pay in lieu of notice.

“Just cause” terminations are those where the employee has forfeited their right to notice or pay in lieu of notice. This can happen when an employee has engaged in serious misconduct (for example, violent or criminal behaviour) in the workplace, or has consistently exhibited extremely poor performance over a period of time, despite opportunities for improvement.

It’s important to note that “just cause” is often considered the “capital punishment” of employment law. It is a severe way to fire someone, and in the absence of actual illegal activity in the workplace, BC courts generally uphold a very high threshold for this type of termination.

What Constitutes “Just Cause”?

Within the category of “just cause,” there are two broad types of employee behaviour that can lead to termination.

Serious Misconduct

This type of just cause is fairly self-explanatory. Things like assaulting coworkers or customers, intentionally destroying company property, or stealing funds can all lead to just cause termination.

Performance Issues

Severe performance issues can lead to just cause terminations, however, performance-based just cause terminations tend to be a bit more difficult for employers to establish.

For example, an employee who was hired for a job with specific hours shows up late once or twice in a few months. It’s not in line with your expectations as an employer, but a few instances of lateness are not enough to justify a dismissal for cause.

As another example, say you have an employee who is consistently showing up hours late or is absent without notice several times per week. After a few weeks, you give them a verbal warning that they will face repercussions if they do not improve their attendance. After a few more weeks with no improvement, you escalate to a written warning. If the employee is still chronically late or absent, then in this situation you potentially have a case for firing this employee with cause.

Building a Case for Just Cause

Just cause is considered a last resort for employers to terminate an employee who is actively resistant to correcting unacceptable behaviour. In any just cause case where the employee has not committed serious misconduct, a court will be looking for evidence that you:

  1. Clearly communicated your expectations for employee behaviour in the workplace

  2. Notified the employee that they were not meeting those expectations

  3. Explained to the employee exactly where and how they were failing to meet your expectations

  4. Provided the employee adequate time, tools, and opportunity to correct their behaviours

  5. Provided the employee adequate opportunity to explain their behaviours, if those behaviours were due to extenuating circumstances outside of the job

As an employer, if you want to establish a just cause termination, you almost always need to be able to provide evidence that you’ve conducted some sort of performance review, provided the employee with a performance improvement plan, and have attempted progressive discipline prior to resorting to just cause.

As an employer, it’s always a good idea to talk to an employment lawyer before you begin the process of terminating an employee for cause, to confirm that this type of firing is indeed justified.

Have an Employment Contract or Written Agreement

In an ideal world, every employer would have a robust written contract for all their employees. Unfortunately, in many cases there isn’t a detailed written document. Even if there is no written contract, employer expectations can be implied. The environment and culture of an organization will be indicative of employer expectations — for example, if everyone at the company usually dresses in jeans and T-shirts, the implication is that the dress code is casual. Likewise, if employees tend to show up to and leave work at different times without reprimand, this implies a level of flexibility with working hours.

There’s nothing wrong with either of the above examples. But, be aware that in a workplace where schedule flexibility is implied, it will be very difficult to terminate an employee with just cause for something like chronic lateness.

Encourage Open Communication

From the above, it’s clear that a just cause case can really only stick if there is evidence that the employer has communicated their expectations to the employee.

Communication of expectations might look like an employment contract, performance reviews, or messages and emails that identify instances where an employee’s behaviour was not in line with expectations.

Even if the workplace culture implies that showing up right at 9:00am is important, if an employee consistently shows up to work at 9:15 or 9:30, the onus is still on the employer to provide some written notice to the employee that their lateness is unacceptable.

Communication can go both ways. Sometimes, poor performance can be related to an issue that an employee is experiencing outside of the workplace — for example, a physical or mental illness, a change in medication, or a death in the family. If reduced performance is due to extenuating circumstances outside of work, then this will be taken into consideration by the courts in a just cause case. Further, terminating an employee for poor performance with the knowledge that those performance issues were due to a health issue, for example, can potentially turn into a human rights issue.

An employer needs to give an employee space to communicate issues like this. If you notice a sudden downturn in performance from an employee who was previously reliable, the first step might be to check in with that employee, and potentially offer support. The employee should not feel obligated to reveal any personal information, however, as an employee if you are given the opportunity to disclose circumstances that may be affecting your performance, and you still elect not to, that can weaken any complaint that you might later make against your employer.

Provide Opportunities for Improvement

If the employee is made aware of their shortcomings in the workplace, then the court will also look at whether they were given opportunities to correct the behaviour.

In a case where an employee is making a lot of errors or doing the job poorly, an opportunity for improvement might mean offering the employee additional training or guidance. Discuss options with the employee, and ask them what tools or resources would be helpful to them. Giving the employee an opportunity to improve their performance could potentially solve those performance issues and avert the need for termination. If the employee’s performance does not improve, or if they are specifically resistant to improvement, then that can strengthen a case against them.

Start with Progressive Discipline

Progressive discipline goes hand-in-hand with communication and opportunities for improvement. Going through steps of progressive discipline means clearly demonstrating to the employee that you do not condone their behaviour.

Ideally, a workplace should have a policy that details the steps of escalating discipline for an employee who is consistently not meeting expectations. For unionized jobs, a detailed progressive discipline policy should be outlined as part of a collective agreement.

In general, progressive discipline will be a tiered process, and can look something like this:

  1. First offence: verbal warning

  2. Second offence: written warning

  3. Third offence: temporary suspension

  4. Fourth offence: termination with cause

However you choose to conduct progressive discipline, the discipline should be appropriate and proportionate to the circumstances. A suspension may be overkill for a lateness or attitude issue, but a verbal warning is likely not a severe enough reaction to an assault on another employee.

Implied Expectations and Condonation

Another thing to be aware of is condonation. Say, for example, that as a manager you don’t really care about punctuality. Sometimes your employees show up late, but they still do their job, so you never mention the lateness. You condone this behaviour.

If one day you leave the company and a new manager comes in who is a stickler for punctuality, this new manager still wouldn’t be able to fire existing employees for lateness, because that creates a situation that is obviously unfair. Condonation essentially means condoning a behaviour or standard through your own reaction to it. You can condone behaviour by allowing it to happen on a regular basis, or by giving someone who behaves a certain way a raise or a promotion. The courts will examine condonation in a workplace in any given just cause case. So it’s important to not only be clear about your expectations, but to be consistent with them, and to have a dialogue with other managers or supervisors who may oversee the same group of employees.

The Termination Process

The actual process of terminating an employee for cause is almost the exact same as without cause. You still have to follow all the requirements in terms of paying them their wages, accrued vacation pay, and any other money owed. The only difference is that you aren’t offering severance or notice — after the termination meeting, the employee is basically out the door. It’s important, then, to make the employee aware that they are being let go with cause. You can include a brief overview of why, but if you’ve done your due diligence with communicating expectations and engaging in progressive discipline, the employee should already know why they’re being let go.

A final thing to keep in mind is that the courts do look at proportionality in cases of just cause. As we mentioned, just cause is really the capital punishment of employment law. It’s a very severe punishment, and one that can have significant repercussions for the employee. As such, a court will usually look at the severity of the circumstances under which a person is being fired in the context of how long they’ve been working for a company and their overall employment history. For someone who has been a reliable worker for several years, but had one really bad day and yelled at a customer, a just cause case is probably not going to stick.

As an employee, if you feel like you’ve been treated unjustly by an employer, you can make an employment standards complaint, in terms of just getting your minimum termination pay. You can also sue for wrongful dismissal, and in just cause cases, wrongful terminations are often a lot more cut and dry, but it’s important that you collect adequate information and evidence to defend yourself.

The law in this area is very well settled, so court cases will come back to specific facts. BC labour law around terminating employees makes it fairly hard to fire somebody for just “mediocre” performance. This system is designed to place a little more power in the hands of employees. In the vast majority of cases, an employee is still entitled to notice and/or severance pay.

As with dismissals without cause, we always recommend that employers treat their employees as human beings, and recognize that being let go, whether with or without cause, is an immensely stressful experience. Fostering a fair workplace environment that encourages open dialogue and provides opportunities for growth and improvement can go a long way toward reducing employee turnover, and in many cases prevent the kinds of performance issues that lead to termination.

We encourage you to seek legal advice when considering a dismissal for just cause – contact us!