Should termination be automatic for employee misconduct when there is a last chance agreement in effect?
By Jeffrey R. Smith
Sometimes, when an employee teeters on the edge of dismissal, the employer may decide to throw her a lifeline and a chance to save her job. That lifeline could involve a memorandum of understanding between the employee and the employer indicating the employee’s job is in danger and, if she repeats her misconduct, her employment will be terminated. This is often referred to as a “last chance agreement.”
When a last chance agreement is drawn up and signed by the employee, it can make terminating the employee easier if the issue leading to the problem is repeated. It makes the employee well aware of the precariousness of her situation, and takes away any possibility of the employee claiming she wasn’t warned. But if a last chance agreement is in effect, should dismissal be automatic if the employee gets into trouble again?
A Canada Post employee in British Columbia signed a last chance agreement in 2009 rather than be dismissed after threatening a co-worker and damaging a wall. Canada Post agreed to keep the employee on, but the employee would be subject to a last chance agreement that stipulated the employee must take anger management counselling within 30 days and keep the employer informed of his progress.
The employee attended sessions with an acquaintance who was a social worker, but it wasn’t true counselling. Both of them knew it, but they went through with the charade and told Canada Post the employee had completed the counselling. Eventually, Canada Post found out and the employee was promptly fired for violating the agreement as well as being dishonest. In upholding the termination, an arbitrator noted that the employee was well aware of his obligations under the last chance agreement and his actions showed he didn’t truly intended to correct his behaviour.
On the other hand, a few years ago, an Ontario garbage truck driver with a history of policy violations and disciplinary warnings was dismissed but reinstated by an arbitrator. As part of the reinstatement, the driver was put under an agreement that any additional violation of “a serious rule” regarding health and safety would end his employment.
About a year ago, this driver got into a fender bender at an intersection. It wasn’t serious, but the employer determined the driver failed to check his blind spot, which was a basic and essential safety rule for drivers. After he was terminated, an arbitrator reinstated him with a suspension, finding the driver’s rule violation was “not insignificant” but not serious enough to warrant dismissal. The last chance agreement didn’t define what a serious breach was, said the arbitrator, so it was open to flexibility.
So a last chance agreement may make an employee on the edge of the cliff aware of her situation, but it isn’t always automatic if there is room for interpretation. In the Ontario case above, the driver had already been fired but was brought back and given one last chance. No-one could say he didn’t have plenty of warnings and he wasn’t aware of how precarious his situation was. Should it matter how serious the misconduct was at that point? Shouldn’t a last chance agreement be just that: a last chance?
Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective. He can be reached at [email protected] or visit www.employmentlawtoday.com.
