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Can you be fired for one act of misconduct? The courts say: Maybe!

Employment lawyers receive calls from employees who have been fired for "cause" or from employers that think they have "cause" to fire an employee.   These calls put us in the position of having to explain the difference between "cause" versus "without cause" termination.   The difference is significant for one essential reason.  In without cause terminations, employers are required to provide reasonable notice or pay in lieu of reasonable notice.  On the other hand, in cause terminations, the employer is not required to provide any notice or pay in lieu of notice.  Given the significant difference, employers will want to take advantage of the opportunity to terminate for cause.    However, an erroneous conclusion about whether cause exists can be costly, and if the dispute ends up in court, the consequences can be severe for the employer found to have wrongly alleged cause. 

The definition for "cause" has been stated as this:

 

If an employee has been guilty of serious misconduct, habitual neglect of duty, incompetence, or conduct incompatible with his duties, or prejudicial to the employer's business, or if he had been guilty of wilful disobedience to the employer's orders in a matter of substance, the law recognizes the employer's right to summarily dismiss the delinquent employee.

 

Generally, one instance of misconduct will not be sufficient for an employer to justify termination for cause. An employee is entitled to warnings in the form of a progressive discipline. However, there are instances where one act of misconduct can lead to an employee being fired immediately for just cause. When this occurs, the employer does not need to provide the employee with reasonable notice of termination, or pay in lieu thereof. Below are some instances where this can happen.

Workplace Dishonesty

The most common reason for dismissal with cause is due to dishonesty. An employee can be terminated with cause if he or she intentionally acts dishonestly and where the conduct seriously harms the employer's interests or reputation, or where the conduct reveals an untrustworthy character which undermines the position of responsibility. Instances of workplace dishonesty include theft, fraud, deception and breach of trust. If the dishonesty is due to theft, a common reason for dismissal with cause, proof of theft is on a balance of probabilities (more likely than not) and the dismissal is justified even if the employee is acquitted of criminal charges.

Whether an employer is justified in dismissing an employee for dishonesty is based on the context of the situation and the alleged misconduct. To justify dismissal, the dishonesty must give rise to a breakdown of the employment relationship.

In the recent case of Complex Services Inc. and Unifor, Local 199 (Hennessy), Re, the arbitration panel found that a single incident of theft can amount to just cause for dismissal. The grievor was employed as a security guard at a casino for ten years at the time he was discharged. The grivor stole sixty dollars in cash from a wallet in the lost and found area of the casino. The employer conducted an investigation of the video surveillance and the log records, and contacted local police. The grievor testified he was addicted to narcotics and at the time of the theft, he was suffering from withdrawal. The arbitration panel found that although the grievor provided evidence that he attended various treatment centres for addiction in the past, there was no evidence that at the time the theft was committed, the grievor was suffering from his addiction or that he committed the theft because of his addiction.  This case shows that the courts will take a contextual approach when analyzing a just cause for dismissal. If reasonable evidence supports a human rights claim for the workplace dishonesty, the employee may not be terminated with cause for a single act of dishonesty. However, lack of such evidence is enough to justify a dismissal with cause.

Insubordination

It is a fundamental term of employment that an employee will obey his or her employer's lawful instructions. Conduct amounting to insubordination sufficient to establish cause for dismissal is when the employee's behaviour goes to the root of the contract. The employer's order must be either clear and specific or the employee's insubordination must be a breach of policies and procedures well known to the employee,  of a serious nature with no reasonable explanation, and the disobedience deliberate and intentional, rather than an honest mistake. The insubordination must strike at the employer-employee relationship in that the relationship is so damaged that it could not be carried on.

Absenteeism and Lateness

Chronic lateness or persistent/prolonged absence from work is an adequate reason for termination with cause if the employee is culpable. This means that an employer cannot fire an employee for chronic lateness or absence if the reasons are related to an employee's medical condition, religion, family responsibilities, or any other protected ground under the Ontario Human Rights Code. However, even if the employee is culpable, an isolated incident, will not justify dismissal with cause except in circumstances where the employee was not only absent, but also insubordinate. For example, in Giancola v Jo-Del Investments Ltd., the Ontario Court of Appeal upheld the trial decision, finding the employer had cause to dismiss the employee. The employee took a 5 week vacation after only providing the employer with one hour's notice and without arranging a replacement, despite a clear warning from the employer not to do so.

Sexual Harassment

Not all sexual harassment will justify dismissal, but sexual harassment involving a non-consensual physical component is the most serious. Since this conduct is a criminal act, one transgression can warrant an immediate termination of an employee's employment.

Our courts will continue to apply a contextual approach in analyzing whether acts of misconduct amount to just cause for dismissal. Employers continue to face a high burden in defending just cause dismissals, but in the event of even a single act of misconduct, an employee can still be lawfully terminated.

To reach the author of this blog, Jean-Francois Lalonde, email jflalonde@viceandhunter.ca or call 613.232.5773 x 246.

Jean-Francois Lalonde is an Ottawa, Ontario employment lawyer and wrongful dismissal lawyer practicing with Vice & Hunter LLP. He has extensive experience practicing in the areas of employment law and is a part-time professor at La Cité Collégiale teaching Employment Law for Paralegals.

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