Month: August 2021

If your employment has been terminated without cause, you are entitled to either a notice period or to pay in lieu of such notice. The amount of notice varies depending on a number of different factors including your age, character of employment, and length of service, among others. In a decision earlier this year, the British Columbia Supreme Court considered another factor: inducement by your employer. That case was Younesi v. Kaz Minerals Projects B.V.

Factual Overview

Mr. Younesi was employed with Kaz Minerals Projects B.V. as an Engineering Manager for just over two months. Before joining Kaz Minerals, Mr. Younesi was working as a project manager for National Grid USA, a position he held for two years prior to joining Kaz Minerals. At National Grid, he earned up to $155,000 USD and enjoyed health care benefits, 401K contributions as well as paid vacations. It was no doubt a comfortable position to have.

Mr. Younesi gave all this up, however, when he was approached and actively recruited by Kaz Minerals. The Court acknowledged Mr. Younesi was “headhunted” by Kaz Minerals. In their offer letter, Kaz Minerals projected that Mr. Younesi would be employed or just under two years. The letter also provided Mr. Younesi with a comparison of the compensation offered by Kaz Minerals against his current employer, National Grid. Notably, Mr. Younesi was promised a substantial increase in base salary and vacation entitlements for the nearly two years he was expected to work.

It is no surprise that Mr. Younesi accepted the offer. Clearly, this comparison of compensation was intended to induce Mr. Younesi to leave his current position with National Grid and to join Kaz Minerals. It was convincing, and it worked. Mr. Younesi left a comfortable position to work for Kaz Minerals.

Understandably, he was very upset when he was fired only two months later.

The Role of Inducement in Assessing Notice Period

Where an employee has been induced to leave secure employment, this can be an important consideration in determining the amount of reasonable notice. Presumably, an employee would not leave a secure position if there had not been at least an implied agreement of job security with the new employer. This is not a new concept. In the 1984 decision Hooker v. Audio Magnetics Corp. of Canada Ltd., an employee who was induced away from a secure position was awarded 14 months’ notice despite only having worked one year with the new employer.

In Mr. Younesi’s case, the Court had no trouble concluding that he had been induced to leave his prior job. The compensation comparison was sufficient to draw this conclusion.

In referring to the offer, the Court said, “It was designed to be an irresistible offer having regard to Mr. Younesi’s personal circumstances.”
Inducement is a matter of degree. The inducement in one case may not be as attractive as the inducement in another. In this case, the inducement was fairly strong and Mr. Younesi was quick to bite.

The Court, in considering the inducement, concluded that it was reasonable to increase the notice period owed to Mr. Younesi by an additional two months.

Duty to Mitigate Overview

Once dismissed, an employee assumes the duty to mitigate. This means they are expected to minimize their losses by making reasonable attempts to find alternative employment. The entire purpose of granting employees a reasonable notice of termination and notice period is to enable them to find new employment. It is only reasonable, therefore, to expect that they use their notice period actually searching for new employment.

Importantly, the employee is not expected to accept just any job. A dismissed employee is under no obligation to accept a lower paying job. An employee is instead expected only to apply for jobs that are comparable to the one they were terminated from. Comparability depends on a number of factors including salary, hours of work, responsibilities, and distance from home, among others.

Failure to mitigate might entitle an employer to a reduction of the damages they are ordered to pay. The employer has the burden of showing that the employee did not make reasonable efforts to mitigate their losses. This is no easy task. They must show that the employee’s efforts were unreasonable in all aspects and, subsequently, that the employee would have secured a comparable position had they acted reasonably.

How to Meet Your Duty to Mitigate

It is important that a dismissed employee has some way of showing that they did make reasonable efforts to mitigate. Otherwise, they may see their entitlements reduced.

Thankfully, it is not difficult to meet this duty. The standard is reasonableness, not perfection. You do not need to begin your job search immediately. You do not need to be submitting applications all day, every day. As previously mentioned, the employee does not need to accept any job offer they might receive. If the employee’s field is highly specialized and therefore presents limited job opportunities, that employee does not need to search as extensively. In some cases, a few inquiries are sufficient. It is always a question of fact on a case-by-case basis whether or not the employee has made reasonable efforts to secure comparable alternative employment.

The best way to ensure that an employee meets their duty to mitigate is to keep records of all their efforts to find alternative employment. This might include time spent on networking or browsing employment websites such as Indeed. An employee should keep track of every job application they send out and to whom. If there is a job posting available but it offers employment that is not comparable to the employee’s previous position, this should also be noted. If the employee is invited for an interview, this should be recorded. Whether a job offer is received or not must also be recorded.

At Ball Professional Corporation, we provide our clients with a pre-built template for use in their mitigation efforts. Working with this template and completing it with the details of your job search will assist us in negotiating the best outcome for you in your particular case.

That’s it – you’ve had enough. You’re ready to quit your job. You know you’re supposed to tell your employer beforehand, but you’re not sure exactly when you’re required to do so. It is commonly believed that two weeks’ notice is required. However, this is not necessarily the case. As we will see, some employees may be required to give notice much further in advance than just two weeks.

Is Notice Required At All?

Just as employers are required to give employees reasonable notice of termination, employees are likewise required to give their employers reasonable notice of resignation. The purpose is to give employers a reasonable opportunity to hire and train a replacement for the departing employee.

How Much Notice is Required?

The amount of notice you will be required to give your employer will vary. For this reason, two weeks’ notice may or may not be appropriate. The factors to consider in determining how much notice is appropriate include the employee’s responsibilities, their length of service, their salary, and the length of time it would reasonably take the employer to either replace the employee or take steps to adapt to its loss. Obviously, if you have worked with a particular employer for a very long time and in a very specialized role, it will be more difficult for them to find a replacement and therefore you should expect to give a greater notice period than if you were employed in a minor role for a relatively short period of time.

For example, in the case Sure-Grip Fasteners Ltd. v. Allgrade Bolt & Chain Inc., three employees resigned: one was a general manager, and the other two were salespeople. The general manager was found to owe their employer a greater notice period than the two salespeople. Specifically, the general manager owed 6 months of notice whereas the two salespeople only owed their employer ¼ months.

It is also possible for your employment contract to provide a specific period of time during which notice of resignation must be given. These can be greater than two weeks. It is therefore essential that you review your contract of employment prior to submitting your notice of resignation.

Can an Employer Fire You After Giving Two Weeks Notice?

When an employee gives notice of resignation, he or she may be asked to work their notice period or be sent home for the duration of it. Either way, the employee must be compensated for the entire period. Moreover, if the employee gives notice of resignation and is subsequently terminated, the employer must still pay the remaining notice. For example, if an employee gave their two weeks notice of resignation and was terminated after a single week, that employee would still be owed the remaining week from the notice period.

Notice According to the Employment Contract

The Employment Standards Act (ESA) provides that employees with less than two years of service, must give one week of notice. If the employee had two years of service or more, he or she must give two weeks notice. It is common for employees to believe that they must always give two weeks notice of resignation. However, as the ESA states, it can be even just one week.

The employment contract is also relevant for this subject. The contract may include longer notice periods than the ESA. If an employer believes the position could be very difficult to fill, a longer notice of resignation clause may be included. Therefore, if an employee is planning to resign, they should check the employment contract to see how much notice they must provide their employer.

Consequence of Failing to Give Notice

If you do not give your employer reasonable notice of your resignation, you might be liable to your former employer for damages. These damages are measured by assessing the cost to the employer resulting from your failure to give such reasonable notice. The employer must prove that it incurred costs, expenses or damages that were greater than what the employer saved by not having to pay your salary during what would have otherwise been your notice period.

However, it is not enough for the employer to show only that your unexpected resignation inconvenienced them. Furthermore, the employer also has an obligation to mitigate their losses (i.e., they must actually make an effort to find a replacement for you).

Play It Safe

Giving notice of your resignation is understandably an awkward and uncomfortable thing to have to do. But, it is also the safest thing to do.

You might be concerned about how your employer will react once you’ve given your notice. Can they fire you immediately? Unfortunately, they can. However, you don’t walk away with nothing! When this happens, courts generally hold that it is the employer who has terminated the employment, not the employee. Giving your notice of resignation is not grounds for your employer to summarily dismiss you. If they do, you will remain entitled to compensation in the form of pay in lieu of reasonable notice.

Even if you are happy with your current job, a day might come where you must choose between the job you have and a job being offered to you. This is already a difficult decision to make. It can become more difficult when you begin to wonder what your current employer might do if they found out. You might wonder whether or not they could fire you for receiving the job offer. Can they fire you? Below, that question will be answered.

The Short Answer

Yes, they could fire you. But this is no surprise! As long as you are not unionized, your employer can terminate you for any reason and at any time. But if they do choose to terminate your employment, you will be entitled to either a reasonable notice of termination period or to payment in lieu of notice, provided that you are not being terminated for “cause”.

The question, therefore, is not whether you can be terminated for receiving a job offer – the answer to that is yes. Rather, the real question is whether or not receiving a job offer enables your employer to terminate you for cause, thus stripping you of your entitlement to reasonable notice or pay in lieu.

Note that if you are a member of a union, your collective agreement will generally specify that you cannot be terminated without just cause. Therefore, it would be essential for your employer to prove they had just cause if they wished to fire you as a result of this job offer.

Does Receiving a Job Offer Constitute Just Cause?

Employers have the right to summarily dismiss an employee where the employer has “just cause” for doing so. In this case, they are not required to provide the employee with reasonable notice or pay in lieu of notice.

The grounds upon which just cause can be established are well founded. They include such grounds as insubordination, incompetence, insolence, absenteeism, negligence, neglect of duty, dishonesty, criminal activity and violence, among others. Notably, receiving an offer for alternative employment is not included. This does not constitute just cause. So, although your employer can certainly fire you for it (as they can for just about any other reason), they must provide you with reasonable notice or pay in lieu.

Competing with an Employer?

Interestingly, one ground for summary dismissal is competing with your employer during the course of the employment relationship. One might argue that receiving an offer to work elsewhere constitutes such competition, especially where the potential new employer is a direct competitor of your current employer. The reason such competition amounts to just cause is due to the implied obligation of employees not to compete with their employer or to assist a competitor during the employment relationship. This is a component of the employee’s general duty of good faith and fidelity. But, it must be emphasized that this obligation applies during the employment relationship. If all you’ve done is receive a job offer, you cannot truly be said to be competing with your employer during the employment relationship unless you accept the job offer and actually commence working with the competitor. As long as you do not do that, it is very unlikely your current employer could argue that they have terminated you for cause.

So, rest assured – receiving a new job offer will not give your employer grounds to terminate you summarily.

As an employer, you will come to find that there are many different kinds of employees. Some are hardworking, reliable, trustworthy and dependable. Others are not. You might decide that your business would be better off without employees who are unreliable, untrustworthy, underperforming and thus not dependable – in other words, incompetent. Of course, in Ontario employers are entitled to terminate their employees for any reason provided they are given either reasonable notice of termination or pay in lieu of notice. But, if the incompetence of the employee establishes “just cause”, you can terminate them without that notice or pay in lieu of notice. For that reason, it is always better to terminate for cause.

The central question, therefore, is whether or not incompetence justifies summary dismissal for cause.

Can Incompetence Justify Summary Dismissal for Cause?

It is certainly possible for an employee’s incompetence or substandard performance to justify summary dismissal. However, it is a difficult standard to meet. The employer must show “gross incompetence”. Generally, the employer must also prove the following:

• (1) That the employer has established reasonable objective standards of performance;
• (2) That the employee failed to meet those reasonable objective standards;
• (3) That the employee was clearly warned of their failure to meet those standards;
• (4) That the employee understood that their employment would be at risk if they continued to fail to meet those standards; and
• (5) That the employer has provided the employee with reasonable time to correct the performance. Failure to provide the employee with a reasonable time to correct their performance will preclude a finding of just cause for dismissal.

If the employer’s expected standards are not reasonable to begin with, courts will be very reluctant to find that an employee was incompetent in failing to meet those unreasonable standards. For instance, in the 1996 decision Gorman v. Westfair Foods Ltd., a Manitoba Court found it unreasonable for an employer to require an employee to consistently meet a specific benchmark where that benchmark is informed by factors beyond the employee’s control.

Cumulative Incompetence

Normally, a single incident of incompetence or carelessness will be insufficient. However, just cause may arise where there has been a number of incidents of incompetence that, although individually insufficient, taken together will cumulatively justify summary dismissal. In these cases, the employer must show that the employee was warned about and given an opportunity to correct their substandard performance and that the cumulative failings would prejudice the employer’s business.

In Ross v. Willards Chocolates Ltd., Justice Galt stated:

“I do not think it is necessary to rely upon such a single instance where the employee’s conduct shows a general laxity and disregard of instructions in a business requiring energy, accuracy of accounts, and strict adherence to instructions, such as this business required.” (emphasis added)

Important Takeaway for Employers

The above discussion should make it clear that it is no easy task to dismiss an employee for cause because of incompetence. If this is your goal, it is essential that you ensure you have reasonable objective standards in place, that you’ve communicated these standards to your employees, that you’ve provided them with warnings where they fail to meet these standards, and that you’ve provided them with a reasonable opportunity to correct their behaviour. Failing to take any of these necessary steps will likely preclude you from dismissing an employee summarily.

What is Insubordination?

Insubordination, or disobedience, occurs where an employee intentionally refuses to obey an employer’s lawful and reasonable order. That order must be within the scope of the employee’s job duties. Examples of insubordination might include:

• a) Refusing to comply with an employer’s reasonable order to return to work;
• b) Consistently failing to arrive to work on time;
• c) Consistently abandoning your shift without permission;
• d) Refusing to carry out a necessary order when instructed to do so; and
• e) Refusing to follow reasonable orders intended to address safety hazards.

When Will Insubordination Justify Dismissal Without Notice?

Insubordination may justify the summary dismissal of an employee (i.e., dismissal without notice) because insubordination constitutes a complete disregard of an essential condition of the employment contract: that the employee must obey the proper orders of the employer. This is fundamental to an employment relationship as, without this condition, no employer would be able to direct their workforce.

To justify summary dismissal, the employee’s insubordination must be willful. If the employee fails to obey an order because the order was not clear, or because the employee was reasonably confused as to what the employer expected, there may not be cause for summary dismissal. For this reason, an employer who fails to give their employee clear and unequivocal instructions should not terminate that employee if they fail to perform the task. This also applies where an employer merely gives their employee a “suggestion” rather than an order.

• (a) Single Incident of Insubordination

A single incident of insubordination will very rarely justify summary dismissal. This will only occur in exceptional circumstances.

Such an exceptional circumstance may be where the single incident of insubordination amounts to a repudiation of the contract of employment. It is important that the insubordination be related to some matter of substance. A minor incident would therefore be unlikely to justify summary dismissal. If the employer conducts itself such that it gives the impression that the order is inconsequential, the employer may not be able to dismiss employees for failing to comply. Whether the insubordination has irreparably damaged the employment relationship will also be a factor in determining whether the termination is justified.

Where a single incident of insubordination does not justify summary dismissal, an employer should instead impose progressive discipline such as verbal or written warnings.

• (b) Multiple Incidents of Insubordination

A single minor incident of insubordination will not justify summary dismissal. However, multiple minor incidents of insubordination might. For example, an employee who consistently fails to show up to work on time despite receiving several warnings may be summarily dismissed for insubordination. Several instances of insubordination, when viewed cumulatively, can therefore justify summary dismissal.

When Can an Employee Refuse an Order?

It is generally true that employees have an obligation to obey the orders of their employers. However, that is not always the case. In some scenarios an employee will be entitled to refuse an order and will not be found insubordinate.

For example, employees cannot be summarily dismissed for failing to obey orders that:

• a) They are not required to perform (e.g., an employee cannot be fired for refusing to work during a lawful labour strike);
• b) Are given by somebody without the proper authority to give orders;
• c) Are unlawful (e.g., an employee cannot be fired for refusing to work overtime hours when those hours are contrary to the Employment Standards Act, 2000);
• d) Are unreasonable in light of the norms of contemporary society; or
• e) Are unsafe (under Part V of the Occupational Health and Safety Act, workers in Ontario have the right to refuse unsafe work).

An employee is not insubordinate simply because they disagree with their employer on business matters, even if they express that disagreement in front of their fellow employees. Furthermore, insubordination will not be cause for dismissal if the employee has a reasonable explanation for the disobedience.

Toxic (or “Poisoned”) Work Environments

If you are working in an environment where you believe you are the victim of bullying, discrimination, or harassment, you may be working in a toxic or “poisoned” work environment. These environments are illegal. A work environment that is toxic may violate the Ontario Human Rights Code (“OHRC”) and the Occupational Health and Safety Act (“OHSA”). If the toxic environment is not addressed by the employer, this could amount to a constructive dismissal. In every employment relationship, there is a fundamental implied term that the employer will treat the employee with civility, decency, respect and dignity. Further, the employer has a common law duty to provide a safe system of work. As such, they also have a duty to prevent abuse and inappropriate conduct by co-workers.

The employee, as the claimant, bears the burden of proof. The test to establish a toxic or “poisoned” work environment is an objective one. This means that the employee’s subjective feelings or genuine belief will not be enough. Instead, there must be evidence that could lead a reasonable bystander to conclude that a poisoned workplace environment was created.

Under the OHSA

Under the OHSA, workplace harassment is defined as “engaging in a course of vexatious comment or conduct against a worker in a workplace that is known or ought reasonably to be known to be unwelcome.” This includes sexual harassment. Captured by this definition are unwelcome comments that are offensive, embarrassing, humiliating and demeaning as well as intimidating or discriminatory.

The OHSA requires employers to conduct investigations into incidents and complaints of workplace harassment and to subsequently inform the complainant and alleged harasser of the results of such an investigation.

Note, however, that it is far more common for an employee to seek remedies under either the OHRC or through constructive dismissal, as discussed below. This is because employees do not recover damages where an employer is found to have violated the OHSA.

Under the OHRC

Under s. 5 (1) of the OHRC, all employees have a right to equal treatment without discrimination based on the following grounds: “race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orientation, gender identity, gender expression, age, record of offences, marital status, family status or disability.” These are known as prohibited grounds. There must be no harassment or discrimination in the workplace relating to any of these grounds.

An employee who is experiencing harassment or discrimination contrary to the OHRC may be working in a toxic or “poisoned” environment.

Potential Constructive Dismissal

An employee may be constructively dismissed if their employer, by their own conduct or by their failure to prevent the conduct of others, has treated the employee so poorly that it is impossible to continue the employment relationship. In such a case, the employer has by its conduct demonstrated its intention to no longer be bound by the employment contract.

Usually, a constructive dismissal will not follow a single, standalone incident. It could, if the incident is particularly egregious. However, generally speaking, a constructive dismissal will require serious wrongful behavior that is persistent or repeated.

If you have indeed been constructively dismissed from your employment, then you can sue for constructive dismissal. The exact amount of compensation you can recover may vary depending on a number of factors, including your age, length of service, and availability of similar employment, among other considerations.