Working notice doesn’t always work

“You are the kind of employer that employees shoot," says employee put on working notice

Working notice can be appealing to employers who don’t have the resources to hand out the large amounts of cash that often go hand-in-hand with dismissal without cause. But the recent case of Elg v. Stirling Doors shows, in some cases, employers might be better off handing over the cash rather than having an employee work through a hostile notice period.

Theresa Elg was a long-term employee of Stirling Doors Ltd., a manufacturer of kitchen cupboards. She was a competent manual labourer who was neither criticized nor disciplined for job performance in the first nine years she worked for Stirling.

In October 1999 Stirling’s co-owner, Rick Weishar, called a meeting of Stirling’s eight employees. At the meeting, he blamed Elg for a deterioration in workplace morale and reduced productivity. He also criticized her for refusing to help others when her work was finished. Elg reacted negatively to the criticism. She began isolating herself by refusing to speak to co-workers and refusing to use the employee lunch room. None of the concerns expressed by Weishar about Elg were documented, nor was she further reprimanded, disciplined or warned about the consequences of her conduct.

On Dec. 10, 1999, Elg’s employment was terminated. She did not receive any prior warning or notice of termination. Because Stirling did not allege just cause, Elg was offered eight-weeks’ notice – the statutory minimum – in the form of working notice. This offer was accepted by Elg and she began her period of working notice on Dec. 13, 1999.

It quickly became apparent working notice was not a good idea. When Elg returned to Stirling on Dec. 13, she did little work, much of what she did was wrong and she created inordinate waste. The next day, she engaged in disruptive work tactics which impacted on the productivity of other employees. On that day Weishar and Elg had an unpleasant exchange, each accusing the other of causing workplace chaos. Elg told Weishar the notice period would be “eight weeks of hell” and there was nothing that he could do about it. She said, “You are the kind of employer that employees shoot.”

Weishar reported the statement to the police. He immediately terminated the period of working notice, citing wilful misconduct as the grounds for immediate dismissal for just cause. Stirling paid Elg for the two days of working notice and no more. Elg subsequently sued Stirling for wrongful dismissal.

At trial, Stirling took the position that Elg’s conduct on Dec. 14 constituted just cause warranting immediate dismissal. Stirling relied on a provision of the Employment Standards Act which provides that an employer can dismiss an employee for cause during the period of working notice if the employee is “guilty of wilful misconduct or disobedience or wilful neglect of duty.”

The trial judge didn’t accept the employer’s argument and blamed Stirling for creating the environment in which Elg found herself by giving her working notice instead of pay in lieu of notice. The trial judge said:

“Working notice is an institution almost invariably predestined to fail. The consequence of (Weishar’s) decision was predictable. Only the precise form of that consequence was uncertain. Weishar created the environment. There was a florid exchange marked by hostility and anger. Weishar will not now be heard to invoke the readily foreseeable confrontation made possible by his actions as a basis for a claim that Elg was dismissed for cause on Dec. 14.”

The court found Elg had been wrongfully terminated on Dec. 10. Stirling was ordered to pay Elg, who was 54 at the time of her dismissal, the equivalent of eight-months’ notice. She was also entitled to recover the overtime she would have earned during the notice period, based on a three-year average of her overtime earnings at Stirling.

The court’s decision in Stirling means employers should rethink whether employees dismissed without cause should receive pay in lieu of notice instead of working notice. In most cases, employers would prefer cutting ties with recently dismissed employees and pay out the notice period in order to avoid the very problems Stirling faced with Elg. Employers who prefer working notice usually do so because they either want to get value for the money they are paying out or because they may not have the financial resources to pay the large sums of money which often accompany dismissals without cause.

This case demonstrates that an employer can often lose control of the terms of dismissal when an employee is forced to work through the notice period in a hostile environment. The court in Stirling appears to be sending a message to employers – if things go badly during the period of working notice, then you have no one to blame but yourself.

For more information see:

Elg v. Stirling Doors, 2002 Carswell Ont 2574 (O.S.C.).

Mark Mason is an employment law lawyer and civil litigator with Goodman and Carr LLP in Toronto. He can be reached at (416) 595-2171 or mmason@goodmancarr.com.

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