Can you dismiss an employee for cause due to poor performance?

The answer is yes, but it will depend upon the specific facts

Stuart Rudner

By Stuart Rudner

As regular readers will know, one of my favourite topics is summary dismissal.

My book, You’re Fired!, discusses the issue of when an employee can be fired for cause in extensive detail. One of the chapters addresses a question that I am often asked: “Can an employee be dismissed for cause as a result of poor performance where there is no misconduct?”

The answer is yes but, as we lawyers like to say, it will depend upon the specific facts.

The law is fairly clear: An employee can be dismissed where their performance does not meet the reasonable expectations of the employer. However, an employer seeking to dismiss an employee as a result of poor performance will be required to show that they made reasonable efforts to work with the employee before making the decision to dismiss. The employer must:

•set a clear and reasonable standard of performance

•communicate the expected level of performance

•measure the employee’s performance

•take appropriate action to address any concerns

•allow a reasonable time for improvement.

With respect taking "appropriate" action to address concerns, what is appropriate will depend upon the circumstances. But the employer must provide clear warnings that the employee’s performance is unacceptable and will result in dismissal if the deficiency is not remedied. Furthermore, it will usually be appropriate to provide some level of assistance through coaching, training, or similar efforts.

As should be self-evident, clear documentation is a necessity. Vague verbal warnings that an employee is not living up to expectations, or that they should improve, will not be sufficient. Employees must be told, in no uncertain terms, their performance is unacceptable and will lead to a termination of their employment if it does not improve.

Unfortunately, many supervisors and managers have not been trained in the art of performance management.  Furthermore, they are often reluctant to engage in the socially awkward process of discussing performance concerns and offering negative feedback. Simply put, most people do not like conflict, and will avoid it whenever possible, even if it means accepting mediocre (or lesser) performance.

As a result, it is rare that I see poor performance reviews. Typically, most reviews are what I would consider to be average, with indications that the employee is “meeting expectations” or something similar. Even when there are legitimate concerns, they are seldom raised and, when they are, the language is so watered down the message is often lost. 

This is where many employers effectively shoot themselves in the foot and weaken any potential allegation that they had for just cause for dismissal.

When I am consulted by a client seeking to dismiss an employee for cause on the basis of performance issues, the first thing that I will ask for is their file, and in particular, their performance reviews. Even in cases where I am told the employee has been a poor performer since the beginning, it is not unusual for me to find that the reviews suggest an average employee, and a further review of their file shows that they received regular salary increases and often received bonuses.

Furthermore, there will be no notations in the file with respect to concerns regarding the employee’s performance or warnings at dismissal will result if their performance does not improve. I have even seen some cases where managers have provided references, or recommendations on LinkedIn, praising the employee and their work product.

The bottom line is that it is possible to dismiss an employee as a result of performance issues. However, if employers want to have a reasonable chance to dismiss an employee for cause, they must ensure all managers and supervisors are trained in the art of performance management.

Concerns should be identified, discussed with the employee and clearly documented. Furthermore, the employee should be warned that dismissal may result if there is not a sufficient improvement in the level of performance.  Allowing a poorly performing employee to “slide under the radar,” receiving average performance reviews along with routine pay increases and even bonuses, will weaken any potential case for summary dismissal. Providing positive reviews can effectively eliminate any chance of satisfying a court that just cause for dismissal exists.

Of course, if just cause cannot be proven, it is always open to an employer to terminate the relationship with appropriate notice or pay in lieu thereof. However, that may be a costly alternative.

Stuart Rudner is a leading HR Lawyer and a partner in the Labour & Employment Law Group of Miller Thomson LLP, a national law firm. He provides clients with strategic advice regarding all aspects of the employment relationship, and represents them before courts, mediators and tribunals. He is author of You’re Fired: Just Cause for Dismissal in Canada, published by Carswell. He can be reached at 416.595.8672 or [email protected]. You can also follow him on Twitter @CanadianHRLaw and join his Canadian HR Law Group on LinkedIn.

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