Progressive discipline needed to terminate for cumulative misconduct

Henson v. Champion Feed Services Ltd., 2005 CarswellAlta 388, 2005 ABQB 215 (Alta. Q.B.)

An Alberta court has ruled a company was not entitled to fire an employee for cumulative misconduct because it didn’t have a progressive discipline policy.

Walter Henson was a shift foreman for Champion Feed Services Ltd. He’d joined Champion in mid-1995 and, despite having received five verbal warnings and one written warning for aspects of his job performance, had received a promotion, successive wage increases and profit-sharing bonuses. He earned $16.50 per hour when his employment was terminated.

Champion Feed Services prepares feed for various livestock and poultry according to predetermined formulas. On Aug. 26, 2002, Henson was to mix a batch of feed requiring four bags of Watoka mix. He used three Watoka bags and a fourth unmarked bag. Two days later the fourth Watoka bag was located.

Champion conceded it would not have fired Henson simply for making an error in preparing an order. But the company said he tried to cover up his mistake, that it was “totally unacceptable” and fired him because of a “build up of issues in his work history.”

Henson filed an action for unjust dismissal and when unsuccessful appealed the verdict.

The trial judge ruled Henson’s error constituted just cause for dismissal without notice. But the Alberta Court of Queen’s Bench said the judge was mistaken, because it was clear Henson was terminated for a buildup of issues in his work history. He had made an honest, albeit careless, mistake and termination was a disproportionate consequence, the court said.

The trial judge had also found Henson attempted to cover up his mistake, warranting his dismissal. But the court ruled, however, that evidence on this was “far from clear.” The company had proceeded on the basis Henson had told a colleague not to tell anyone about the fourth bag, but it was not established he’d told the colleague that. The trial judge’s inference of deceit was therefore unwarranted, the court said.

Ultimately it had to rule whether Champion had just cause to dismiss Henson.

A company using cumulative misconduct to prove just cause must give clear warnings about poor performance, and must give the worker a reasonable chance to improve, noted the court. While Henson had received warnings in the past, his record also includes a promotion to a position of responsibility, with pay raises and bonuses each year. He was never told of the concerns about his lack of close attention to production issues. He had never been told his job was in jeopardy. He was entitled to be told this prior to being terminated for a buildup of work issues.

The company did not have the coherence and consistency in its approach to discipline, ruled the court. It treats its employees on the basis of good faith rather than taking a punitive approach. This approach is commendable, but the company cannot then use a production issue as a ‘last straw’ event to justify termination, ruled the court. It awarded Henson six months’ pay in lieu of notice plus benefits.

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