For many managers and employers, terminating an employee is one of the most difficult decisions to make in the process of doing business. Dismissal is often a last resort, however there may be various factors that render termination as the only option.
In Ontario, it is very important that employers act in accordance with the Employment Standards Act, 2000 (ESA), and any other applicable provincial or federal legislation or common law when dismissing an employee. If you fire an employee improperly, you or your business could be subject to a lawsuit and may be required to pay damages and the reasonable legal costs of the employee.
Don’t terminate before understanding the obligation of reasonable notice
According to the ESA, termination and severance of employment without just cause requires the employer to terminate an employee having given reasonable advanced notice or payment in lieu thereof. Employment notice periods established within the ESA are dependent on the length of an employee’s period of employment.
What many employers fail to consider is that the ESA outlines only the minimum statutory requirements. The employer must be mindful of any other obligation to which it may be bound by the common law. An employer should consult with an Employment lawyer prior to termination of the employee to receive advice on what obligations it may have related to reasonable notice. Other situational factors beyond a simple calculation of length of service, such as the employee’s age, ability to find work and role performed, must be considered before an employer can properly identify the obligation of reasonable notice required for that particular employee.
Don’t terminate for just cause without adequate proof
If an employee has engaged in wilful misconduct or a prohibited act during business hours it seems like the right action to pursue summary dismissal. If you decide to dismiss for cause, you do not have to give reasonable notice, however, you do need sufficient proof in case the employee decides to sue for wrongful dismissal. It is the employer's responsibility to prove reasonable grounds for termination in court, and documentation will be necessary to support the employer’s case. An employment lawyer will be able to advise and navigate you through the process of determining whether there are sufficient grounds to terminate for cause and understand the risks in doing so before termination.
Don’t fire the employee without legal advice
There are a number of legal and financial consequences that may occur due to the termination of an employee. Any decision to terminate should be reviewed and advised upon by your Employment lawyer. Your lawyer can answer any questions you may have about severance and termination and will be able to guide you through the process, which may include tips about the exit interview and answering questions from the employee. This will ensure that you are best protected from employee litigation.