The document provides an overview of the law around employee discipline and dismissal in Canada. It discusses the two types of termination - with cause and without cause. For termination with cause, the employer must prove just cause by showing misconduct occurred and it warranted dismissal based on all circumstances. Progressive discipline is recommended to establish just cause. For termination without cause, reasonable notice or pay in lieu of notice is required based on factors like length of service. The duty to mitigate requires reasonable job search efforts to reduce damages. Contractual termination clauses can displace common law notice periods if properly drafted.

1. Turf and Rec
February 25, 2020
“You’re Fired!”
Stuart Rudner
stuart@rudnerlaw.ca
416.864.8501
Presented by:
The Law of
Discipline & Dismissal
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Disclaimer
The user is authorized to use this presentation for the user’s own needs only, and is not
authorized to make copies thereof for sale or for use by others.
This presentation is not provided for the purpose of providing legal advice.
Every situation is unique and involves specific legal issues. If you would like legal advice
with respect to the topics discussed in this presentation, or any Employment Law
matter, we would be pleased to assist you.
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Two Types of Termination
1. With Cause: No further obligations to the employee
1. Without Cause: Notice or pay in lieu of notice
There is NO middle ground - no “near cause”
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Just Cause for Dismissal
“The capital punishment of employment law”
Employer must prove:
1. The alleged misconduct took place, and
2.The nature or degree of misconduct warranted dismissal,
bearing in mind all relevant circumstances
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Just Cause for Dismissal
Contextual Approach: Employer must consider all circumstances,
including:
● Length of service
● Disciplinary history
● Nature of position
● Mitigating factors
● Response to allegation
Has employment relationship been damaged beyond repair?
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Progressive Discipline
“Some lesser form of discipline was appropriate…”
● Warnings (verbal and written)
● Suspension (paid and unpaid) - risky
● Demotion (almost never an option)
● Keys:
○ Set out expectations
○ Warn of consequences
○ Allow reasonable time for improvement
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The Importance of
The Investigation
● Investigate first
● Ensure fairness, objectivity, thoroughness
● Give opportunity to respond
● Often, employee response is critical factor in determining
appropriate discipline
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● Best practice: clear warnings, progressive discipline,
culminating incident
● Single incident can be cause“culminating incident”
DOCUMENT EVERYTHING
Progressive Discipline Cont’d
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Without Just Cause
Must provide Notice of Dismissal or Pay in Lieu
Three potential sources of entitlement:
1. Employment Standards legislation
2.Common Law
3.Contract
*Can contract out of common law using an enforceable
termination provision
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ESA - Notice or Termination Pay
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Period of Employment Notice Required
Less than 3 months 0
3 months but less than 1 year 1 week
1 year but less than 3 years 2 weeks
3 years but less than 4 years 3 weeks
4 years but less than 5 years 4 weeks
5 years but less than 6 years 5 weeks
6 years but less than 7 years 6 weeks
7 years but less than 8 years 7 weeks
8 years or more 8 weeks
● all compensation/benefits to continue

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● Paid in addition to notice or Termination Pay
● If
○ employed for 5 or more years AND
○ Payroll is $2.5M or more
● 1 week per year of employment (prorated)
● Maximum 26 weeks
ESA - Severance Pay
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Common Law Notice
● By default, all employees are entitled to “reasonable notice”
● NOT one month per year
● Based on 4 primary factors:
● employee’s age
● length of service
● nature of work / character of position
● availability of similar employment
● Other considerations, such as inducement
● Cap of 24 months in absence of extenuating circumstances
● By default, all compensation/benefits to continue
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The Duty to Mitigate
● Reasonable notice is bridge to next job, not guarantee
● Duty to make reasonable efforts to search for new employment
● If fail: reduced damages
● If succeed: reduced damages
● This is reason for “clawback”
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Notice, Severance, or Both?
Options available to employers:
● Working notice
● Salary & benefit continuance
○ with clawback
○ without clawback
● Lump sum payment
● Combination of the above
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Working Notice
● Instead of money, keeping an employee on board for that time
● Usually not advisable, but sometimes it works
● All terms and conditions must remain unchanged
● Except: Give them a chance to look for work!
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Termination Tips & Tricks
● Unsure about cause? Consider hybrid approach
● Termination meeting
○ Have a witness
○ Respect and good faith
○ Short and sweet
○ Do NOT let them sign anything right away!
● Secure confidential information
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Contractual Termination Clauses
● Common law “reasonable notice” is default
● Can be displaced by contract
BUT
● Termination clauses often challenged
● Must be drafted very carefully
● Case law changes frequently - review REGULARLY with a lawyer
● It doesn’t always say what you think it does
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Termination Clauses
● Enforceable if done properly
● Avoid uncertainty of “reasonable notice” & reduce dismissal costs
● Use clear language
● Don’t go below employment standards
● Use saving clause
● Avoid “sole entitlement” type wording
● Consider mitigation, release
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The value of a termination clause
Example: A 65 year old Supervisor has worked with the same
employer for over 30 years with slim chances of re-employment
Written Contract: As little as 8 weeks’ pay
No Written Contract: Potentially 24+ months’ pay
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Entering Into the
Employment Contract
● Not worth the paper it’s printed on if not enforceable
● Courts will assess contract & termination clause in particular
● Latest trend is more pragmatic - enforce intention of parties even if
wording is not perfect
● Timing and consideration are key issues
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Consider This
● For contract to be valid, there needs to be valid consideration
SOMETHING GIVEN FOR SOMETHING GAINED
● For new job, consideration is work in exchange for job offer
● BUT - offer has to be signed BEFORE employee has been hired
● If contract signed after work starts - may not be valid at all
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For Existing Employees
For existing employees, when looking to change employment terms:
1)Provide new consideration, such as promotion, bonus, or something of
value
OR
1)Provide notice of change
- if they don’t accept new agreement - may be the end
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Questions
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THANK YOU!
Feel free to contact us if we can be of assistance. We’d be glad to speak with you.
416.864.8500
905.209.6999
www.rudnerlaw.ca
info@rudnerlaw.ca
100 Allstate Parkway Suite 600
Markham, ON L3R 6H3
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