Introduction
Dismissing an employee is never an easy task. It is a delicate matter and if done unjustifiably may lead to a labour dispute. Specifically, dismissing an employee based on unjustified reasons can result in a lawsuit against the employer.
This article outlines the steps that need to be taken in order to ensure that dismissal is justified.
Definition
Employment law in Ontario is governed by the Employment Standards Act (2000) (the “Act”).
Dismissal or termination of employment occurs when the employer:
- dismisses or stops employing an employee;
- constructively dismisses an employee and the employee resigns; or
- lays an employee off for a period that is longer than a temporary layoff.
Constructive Dismissal
Constructive dismissal occurs when an employer makes a significant change to a term or condition of the employee’s employment without the employee’s consent. Constructive dismissal may occur in the following instances:
- a considerable reduction in the salary, hours of work, or position;
- when the employer gives the employee an ultimatum – to quit or be fired and the employee resigns; or
- when an employer harasses or abuses the employee.
Constructive dismissal is a complex process and therefore it is recommended to seek the advice of an employment lawyer in order to understand your rights and know your options.
Temporary Layoff
A temporary layoff occurs when an employer limits or cuts back on the employee’s work without terminating the payment. An employer has the right to put an employee on temporary layoff without providing a date on which the employee will be called back to work. Temporary layoff may not last longer than 13 weeks out of 20 consecutive weeks. Also, during the temporary layoff the employee will earn less than half of the earnings during the regular employment period.
Under the Act, the employer is not required to give an employee a written notice or a reason for being on temporary layoff. If an employee is terminated for longer than the temporary layoff period it means that he or she is dismissed or fired. However, in this case the employee is still entitled to termination pay.
The Requirements for a Lawful Dismissal
According to the Act the requirements for a lawful dismissal include either a written notice of termination, termination pay, or a combination of these items. Importantly, the termination notice and pay must equal the length of notice the employee is entitled to receive depending on the employee’s length of employment.
Employment Contract
A written employment contract may help in the situation of a labour dispute or termination of an employee. Employment contracts should include provisions regarding employment termination. It is crucial to educate yourself regarding such matters, as termination provisions may include important details such as conditions that limit termination to specific causes, or employment security promises.
As an employer, you should always review employment contract termination provisions in order to prevent a potential lawsuit against you.
Dismissal without Notice
Some employees are not entitled to a written notice of dismissal. The reasons for this may include:
- being guilty of willful misconduct;
- disobedience;
- willful neglect of duty;
- being employed for less than three months; or
- refusing to accept reasonable alternative employment.
Termination Pay
An employee who does not receive a written termination notice must receive termination pay in lieu of notice. Termination pay is a payment equal to the regular wages paid for a regular work week. An employee may also collect vacation pay and other benefits awarded during regular payment periods on his or her termination pay. The regular work week depends on how long the employee was employed. For example, if the employee was employed for a period of three years, the termination pay should equal that of three weeks payment.
For a complete breakdown of requirements regarding the termination pay please visit the Ontario Ministry of Labour website at www.labour.gov.on.ca.
Important Details
Besides ensuring a justified dismissal process, an employer must also conduct a safe exit session with an employee. It is important for an employer to make sure that a dismissed employee maintains confidentiality regarding the company’s business and affairs. Furthermore, the employer should remind an employee to return all the documents and records belonging to the company. Also, it is recommended to have another person present during the final talk to ensure that each party is satisfied.
Seeking the Advice of a Professional
If you have decided it is time to seek the advice of a professional ensure to email us your contact information and one of our lawyers will contact you promptly.
Disclaimer
Nothing on this website constitutes legal advice. If you face a legal issue, you should take specific legal advice from a lawyer before taking any action. Three60Legal takes every reasonable step to ensure the accuracy of the information on this website. However, Three60Legal accepts no liability for any loss or damage arising in any way from the use of this site.
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