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The case of the tempting bagel

Scary or even evil conduct on the part of employees is not necessarily just cause for dismissal
Shutterstock/Brian A. Jackson

By Stuart Rudner

Halloween seems like a good time for a reminder that scary and even evil conduct on the part of employees is not necessarily just cause for dismissal. Many employers fail to grasp that they cannot fire an employee for any misconduct, even if it upsets or frustrates them. While there may be good reason for discipline, that does not necessarily equate to just cause for dismissal, which our courts have repeatedly referred to as the "capital punishment of employment law.”

The law of summary dismissal is dreamily complex. To begin with, most employers do not realize that when assessing whether there is just cause for dismissal, they cannot look at the alleged misconduct in isolation. Our courts have made it clear that a contextual approach must be used in which all relevant factors are taken into account.

This will include the individual’s length of service, "record" of past transgressions, past disciplinary actions, the nature of the employee’s position, any mitigating factors, and the employee’s response and behaviour when confronted.

Ultimately, the question to be asked is whether the employment relationship has been irreparably broken. When an employer tells a court that they had just cause for dismissal, what they are effectively saying is that given the circumstances, they could not continue to employ and trust the individual.

In a recent Small Claims Court decision that was affirmed by the Divisional Court, an employer took the position that there was a culminating incident which justified summary dismissal. While there is no reason to doubt the employer's honest belief that they had just cause for dismissal, both courts confirmed that while the employee had clearly engaged in misconduct worthy of discipline, summary dismissal was too harsh.

Garreton v Complete Innovations Inc. was heard by a Small Claims Court judge due to the relatively low value of the claim. The plaintiff, Marcela Garreton, was a full-time employee for a little less than two years. On June 7, 2012, she bought bagels for an internal training session she was running. Another employee who was not attending the session asked for a bagel and the plaintiff asked her to wait until all the attendees got their food. The impatient employee then tried to grab one of the bagels, and the plaintiff grabbed her wrist. The other employee swore at her, took the bagel and left. The employee immediately reported Garreton to the CEO who, after interviewing Garreton, suspended her with pay for two days. According to the court, when Garreton returned to work on June 12, 2012, she was given a letter of termination which relied on the bagel incident and two earlier incidents concerning Garreton’s conduct in the workplace and for which she received warning letters.

The Small Claims Court judge found that there was no just cause for dismissal. She found that the prior two incidents were not serious, and she was critical of both Garreton and the other employee involved in the “bagel incident,” which she found did not amount to workplace violence. Further, the trial judge found that the suspension was the discipline imposed for the bagel incident and the company could not then impose further discipline for the same matter.

So, two (costly) lessons learned by the employer:

  • You cannot penalize an employee twice for the same transgression.
  • The threshold for establishing just cause for dismissal is high.

The employer actually learned a third lesson in that case: A termination clause that is, or even might be, in breach of applicable employment standards legislation will not be enforceable.

In that case, there was a termination clause, but it did not provide for severance pay as is required in Ontario, in certain circumstances. Even though those circumstances did not exist, the fact that the clause could breach the legislation was sufficient to render it invalid.

As I have often stated, one of the biggest mistakes employers can make is to react hastily. When misconduct is suspected, employers must investigate properly and then, if it is clear that the employee did engage in misconduct, the employer must assess the appropriate form of discipline. In order to do so, a lawyer specializing in employment law should be consulted, as the risk of getting it wrong is high, along with the potential liability.

© Copyright Canadian HR Reporter, Thomson Reuters Canada Limited. All rights reserved.

Stuart Rudner

Stuart Rudner, Employment Lawyer and MediatorStuart Rudner is the founder of Rudner Law (RudnerLaw.ca), a firm specializing in Employment Law and Mediation. He can be reached at stuart@rudnerlaw.ca, (416) 864-8500 or (905) 209-6999, and you can follow on Twitter @RudnerLaw.
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