Just cause for termination: A glimpse of the legal landscape

What constitutes just cause?

Stuart Rudner

What is just cause for termination? A practical definition is pretty tough to formulate. Reconciling the body of law that exists is difficult when seemingly minor infractions are sometimes found to constitute just cause, while more egregious behaviour is often not.

The bottom line is that the existence of just cause cannot be determined using “hard-and-fast” rules; instead, each case must be assessed based upon its own unique set of circumstances. For that reason it is instructive to periodically review recent cases where just cause has been alleged in order to see when the courts have agreed and when they have not. Synopses of some recent examples of cases where just cause was alleged, but not necessarily found, are set out below.

Just cause “brick by brick”

Daley v. Depco International Inc.: This decision was rendered by Justice Randall Echlin who was, prior to his call to the bench, a leading member of the employment law bar. Gian Daley was employed in a non-union shop. The company had an employee handbook that provided for a system of progressive discipline.

Over an 18-month period starting in August 2000, Daley was disciplined for nine different incidents, ultimately resulting in his dismissal for cause. The offences included carelessness, suspected alcohol impairment, unreported absences and altercations with colleagues. The employer sought to rely on all nine incidents to justify the termination.

However, since the employee handbook provided that incidents would be removed from an employee’s record after one year, Justice Echlin considered only those incidents that occurred within the year prior to termination.

In his decision Justice Echlin found that while each of the incidents, on their own, might not be sufficient to prove just cause, the series of incidents, viewed as a whole, amounted to “enough bricks to constitute a just cause wall.” In reaching this decision Justice Echlin referred to the Supreme Court decision in McKinley v. BC Tel, which required that allegations of just cause be considered in a contextual approach, taking into account all of the relevant circumstances.

Although that decision was rendered in the context of alleged dishonesty, Justice Echlin suggests such an approach should be taken in all cases where just cause is alleged.

Attempted poisoning: Not just cause?

Canadian Broadcasting Corporation Radio-Canada v. Canadian Media Guild: The grievor was a reporter in a small town. He ran a story relating to Mr. Hamilton, the head of an organization opposed to government cuts. Hamilton called the grievor and threatened to complain to the press council about the story and about the grievor. Subsequently, Hamilton publicly questioned the grievor’s ethics and complained to the CBC and CRTC about the grievor.

The grievor, upset by Hamilton’s conduct, decided he would exact his revenge by buying a box of chocolates, spitting on them, and then sending them to Hamilton. In furtherance of his plan, he purchased a box of chocolates. Later, at home preparing chicken for dinner, the grievor threw the chocolates on the dirty floor. He then took two of them and rubbed them in the thawed, raw chicken and then replaced them in the box. He mailed the package to Hamilton.

Later that night the grievor began to have second thoughts. He made efforts to contact Hamilton and warn him, and eventually succeeded in doing so. Hamilton called the police. The grievor, presumably realizing the precarious position he was in, told his employer what had happened. After a disciplinary investigation meeting, he was dismissed. Through his union he grieved the dismissal.

The arbitrator found the grievor’s behaviour fell within the range of an act demonstrating extreme lack of judgment and maturity, all the way to indicating a level of mental instability. The arbitrator identified the key issue as whether the employer, faced with questions about the grievor’s maturity, judgment, and even mental stability, should have to run the risks associated with maintaining such a person in its employ.

He referred to previous cases dealing with dishonesty, and then compared the grievor’s conduct. The arbitrator took notice of the fact that the misconduct in this case was brought to an end by the grievor himself, who then confessed his wrongdoing. The arbitrator contrasted this with cases where an employee’s inappropriate behaviour is discovered by others, and found that the facts in this case suggested a lower risk of recurrence.

The arbitrator found the behaviour in question was not journalistic misconduct, and there did not exist sufficient evidence that the reputation of the CBC would have been significantly damaged if the grievor had been disciplined rather than dismissed.

He also referred to a psychological assessment that found a low risk of recurrence of such inappropriate behaviour. In his conclusion the arbitrator found the grievor could have been suspended, without pay, pending an assessment of the likelihood of recurrence. Given the results of such an assessment would have shown a low likelihood of recurrence, the arbitrator found the grievor should not have been dismissed.

Failing to submit to a drug test after an accident

International Union of Operating Engineers, Local 955 v. Construction Labour Relations: This is a labour arbitration decision dealing with the termination of an employee for failing to submit to a drug test. The employee in question was a crane operator with 28 years’ experience.

His crane smashed into a live light fixture, which nearly resulted in the death of two people. After an investigation relating to the grievor, the crane signaller and a scaffolder, the conclusion was reached that human error was to blame. The other two employees agreed to submit to drug tests but the grievor refused and was terminated as a result.

The employer had a drug and alcohol testing policy modelled on the Canadian Model for Providing a Safe Workplace Alcohol and Drug Guidelines and Work Rule, although the arbitration board found there were significant inconsistencies between the two and suggested those should be rectified by the employer.

The board found the individuals that made the decision to terminate were operating under the mistaken impression the only disciplinary response to a refusal to undergo testing was termination.

This “created a fundamental flaw in the process.” Furthermore, the board found the investigation meeting which took place was cursory and seemed to have been held solely for the purpose of identifying the employees involved in the accident so they could be tested. There was no consideration given to whether there were reasonable grounds to believe the use of alcohol and drugs did not cause the accident, as required by the policy.

The board found the grievor should have been suspended pending a root cause investigation which would have shown there were insufficient grounds for termination. Like the case above, the decision to terminate was found to have been inappropriate.

Smoking on company premises — where there’s smoke, there’s fire

American Standard Inc. v. United Steelworkers of America, Local 13292: The grievor was terminated for violating the employer’s no-smoking policy which provided that any incident of smoking on the premises would result in termination.

The employer was involved in a manufacturing process that used chemicals which emitted highly flammable vapours that are subject to explosion. No one disputed the reasonableness of the no-smoking policy.

There was a factual dispute regarding whether or not the grievor was actually smoking. Given that smoke was observed wafting up from a bathroom stall which the plaintiff subsequently exited, the arbitrator accepted the company’s position that he was smoking on company premises (and rejected the union submission that there was, at best, only circumstantial evidence of this.) In a real life example of the old adage that “where there is smoke, there is fire” the arbitrator held the discharge was proper.

What should employers conclude from all of this? It is still hard to identify a hard-and-fast rule for when just cause exists. If anything, Justice Echlin’s decision makes it clear there is no rule that can be universally applied. Every case must be examined based upon its own unique set of factors and circumstances.

For employers faced with inappropriate behaviour on the part of an employee, it is important not to react too quickly without giving due consideration to the circumstances as a whole. They should take the time to conduct a proper investigation, suspending the employee with pay where appropriate.

Employers should make efforts to speak to managers and others that might have relevant knowledge of the facts and of the employee in question, and to consult with their in-house or outside counsel with respect to whether or not a termination for cause should be pursued and, if so, how to best go about it. If a court disagrees with the employer’s assessment, and finds there was no just cause, it will be exposed to a significant damages award.

This in-depth look at just cause was provided by Stuart Rudner. He practices civil litigation and employment law with Miller Thomson LLP’s Toronto office. He can be reached at (416) 595-8672 or via e-mail at [email protected].

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