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It is always difficult for an employer to prove just
cause. In an earlier post, we discussed
performance based just cause. This post looks at a recent
case from British Columbia that found just cause based on
dishonesty, breach of contract and breach of the duty of good
faith.
Ernst was hired as a senior executive by a Vancouver based
company to market a system for the secure distribution of
recorded music over the internet. At the time, he was living
in Alberta. He negotiated a written employment contract
that said he would initially work from his home in Alberta, that if
he was required to move to Vancouver the employer would pay
the reasonable expenses of the move, and that his salary would be
increased annually by not less than the cost of living increase in
his province of residence.
Without telling his employer, and with a little deception along
the way, Ernst moved to Mexico. He eventually told the
employer he was working from home in Mexico and the employer
expressed its displeasure. Ernst failed to respond to the
employer's request to make a proposal on how he would deal with
several concerns raised by the employer. The employer did not
take immediate action because Ernst was working on a major
contract with Warner. Three and a half months later,
Ernst was dismissed for just cause.
The court found in favour of the employer. It held that
Ernst had breached his employment contract by moving to Mexico and
that the unilateral move and his failure to accept his
employer's directive that the move was unacceptable gave the
employer cause. The delay in dealing with the matter did not,
in all the circumstances, mean the employer had condoned the
move.
Ernst did not help his case by also being deceptive about some
vacation and sick time and by his argumentative and evasive
testimony at trial. The court ruled that he had
"breached his duties of good faith and honesty, and revealed a
character that undermined and seriously impraired the essentail
trust and confidence [the employer] was entitled to place in
him."
The decision, Ernst v. Destiny Software, has a helpful
and comprehensive review of the basic principles of dismissal for
cause (see paragraphs 117 – 126).
The employer won in this case, but proving cause is
still an uphill battle.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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