Wrongful Dismissal is where an employer has dismissed an employee, but the termination breaches either the terms of the contract of employment, a statutory provision, or an aspect of common law that cannot be contracted out. The following are some examples of wrongful dismissal. Stacey R. Ball – Employment Lawyer in Toronto can help if you are dealing with wrongful dismissal.
1. Not Enough Notice
An employee is entitled to proper notice of their termination. If they are not provided with sufficient notice, then there is a wrongful dismissal. The correct length of notice period depends on many factors, including but not limited to: whether the Employment Standards Act (the “ESA”) minimum notice applies, the common law reasonable notice applies, or if the employment agreement provides for a different, but still legal, notice period calculation.
2. Not Enough Severance
Severance is essentially pay in lieu of notice. As such, if an employer decides to provide severance pay instead of working notice, the employer must provide enough severance that reflects what the employee would have received if they had worked through the proper notice period. If the severance provided is not sufficient, then there is a wrongful dismissal.
3. Unfounded Allegation of “Just Cause”
An employer is not obligated to provide an employee with notice or with severance if they have “just cause” to terminate the employment relationship. However, if the employer asserts just cause, but it is later determined by a court that the employer lacked cause, there is a wrongful dismissal.
4. Benefits Are Not Continued
An employee is entitled to have benefits continued throughout the entire notice period. Once again, this is to reflect what the employee would have had access to if they had worked through the proper notice period. If the benefits are not continued for this period, there may be a wrongful dismissal.
5. Commissions Are Not Paid Over the Notice Period
If an employee would have made commissions if they worked through the proper notice period, then there may be a wrongful dismissal if those commissions are not provided when an employee is given pay in lieu of working through the notice period.
6. Bonuses Are Not Paid Over the Notice Period
If an employee would have received a bonus had they worked through the notice period, then the non-provision of that bonus may constitute a wrongful dismissal. Further, it is possible that an employee may be entitled to a pro-rated bonus that becomes payable beyond the notice period. However, it is also possible that the employment contract contains a provision that removes the employer’s obligation to account for bonuses in the severance package.
7. The Employee was Constructively Dismissed
If an employee was constructively dismissed (i.e., an employee resigned as a result of a hostile work environment), there may be a wrongful dismissal if the employer refuses to pay severance.
8. A Contractor was not Provided any Notice
Often, employers will label their workers as “contractors.” However, whether or not those workers are truly “contractors” or actually employees in the eyes of the law will depend on multiple factors, and not just the label used by the employer. Further, even if a worker is a contractor, they may be a dependent contractor and still entitled to a notice period or severance. There could be a wrongful dismissal if neither a notice period nor severance are provided.
9. The Employer did not Fulfil Obligations Contained in the Contract
Where the employment contract specifies terms and conditions that are to be followed in the case of termination (e.g., how benefits or bonuses will be paid) and the employer does not follow these (i.e., fails to uphold its contractual promises to the employee), then there may be a wrongful dismissal.
10. The Termination was Before the End of a Fixed Term
A fixed term employment contract specifies when the end date of the employment relationship is. If the employee is terminated before this date, there may be a wrongful dismissal.
11. A Probationary Employee was Terminated Without any Notice
The ESA provides that an employer does not owe any notice or pay in lieu before 90 days. If a probationary period extends beyond 90 days, then the employer will owe the employee either notice or pay in lieu. Further, the employer is not allowed to terminate a probationary employee in bad faith. If someone is fired as a probationary employee without notice or severance after the 90 day period, or if there was bad faith, there may be a wrongful dismissal.