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A frustrating dilemma

When licensing requirements change, should an employee be given a chance to regain the license before dismissal?

By Jeffrey R. Smith

There are certain professions that are licensed, which is generally a good thing. Licensing means there are professional standards that someone must maintain and there is an overseeing body — whether governmental or professional — that checks in to make sure the licensed individual is upholding those standards. And that, hopefully, ensures the job is done right and done well.

But what happens if licensing standards change and suddenly an individual who used to meet the standards no longer does? If a job requires a license and the individual has that license when hired, what are his employment rights if the requirements for that license change and his license is no longer valid?

This issue came up a few years ago when new legislation came into force that changed licensing requirements for security guards. One of the changes was that, in order to qualify for a security guard license, individuals had to have a clean criminal record.

This caused a problem for a security guard at an Ontario casino, who had a conviction for a break-and-enter when he was younger. Before the legislative changes, it didn’t affect his ability to hold a security guard license, which he had when he was hired by the casino in 2000. But when the new legislation came into effect in 2007, he suddenly didn’t have one. Since he no longer had a license, he couldn’t legally be employed as a security guard. The casino claimed frustration of the employment contract and terminated his employment.

The former guard sued for wrongful dismissal and won, as the trial court found the casino should have given him a chance to get a pardon for the past criminal charge, which would have enabled him to renew his license. However, an appeal court overturned the decision, finding an employer couldn’t be bound by an employment contract when it’s illegal for the employee to perform services under that contract. This would be something “radically different” from what was agreed to when they entered the contract, said the appeal court.

The trial court’s ruling is understandable in that it might be considered fair to give the employee a chance to remedy the situation, since it wasn’t the employee’s fault the contract was frustrated. However, should the employer be expected to wait for an uncertain amount of time until the employee is qualified again? From the employer’s perspective, if it’s illegal for an employee to do the job he was hired for, the course of action would seem to be pretty simple. But from the employee’s perspective, dismissal might seem unfair if there’s a chance to regain the license. Who’s right: the trial court who was on the employee’s side, or the appeal court who was on the employer’s side?

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 or visit

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Jeffrey R. Smith

Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective.
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