In this article we provide a brief overview of the implications
of ending an employment relationship in British Columbia.
An employer may end an employment relationship: [a] with just
cause, or [b] with working notice (or pay in lieu of notice).
Just cause is misconduct which goes to the heart of the
employment relationship. An employer who has just cause to end the
employment relationship may do so without providing the employee
any notice or severance pay. Examples of misconduct that may
constitute just cause include:
[b] a serious act of dishonesty;
[c] a serious breach of a fiduciary duty;
[d] a conflict of interest;
[e] assault; or
[f] sexual harassment.
Usually, a single act of misconduct will not be sufficient to
establish just cause. However, where the act in question is serious
or is a “culminating” incident (the last in a series of
incidents), the employer may be justified in summarily dismissing
the employee. The threshold for proving just cause is quite high,
and the Courts have found that only the most serious misconduct
will give rise to just cause to fire an employee.
Economic considerations, including the business losing money, is
not just cause.
Notice or Pay
In the absence of just cause, the parties will have to provide
some combination of notice or pay in order to end the employment
contract. The parties may contract for the terms on which the
employment relationship will end - such provisions are common in
employment agreements. The parties may agree on any number or
formula to calculate notice or pay, provided it does not result in
the employee receiving less than the minimum employment standards
In B.C., the applicable employment standards legislation
entitles an employee to approximately one week’s notice, or
pay in lieu thereof, per year of service up to a maximum of eight
weeks notice or pay in lieu after eight or more completed years of
If the parties have not expressly agreed to the terms on which
the employment ends, or if those terms are less than the employment
standards minimum and hence void, the Court will imply a term of
reasonable notice. Determining how much notice is
“reasonable” is more an art than a science and the
Courts have consistently rejected fixed formulas for making such a
The Courts will look at the entire context of the employment
relationship to determine “reasonable”, but will focus
on four factors:
[a] the age of the employee (the older the employee the greater
the notice entitlement);
[b] the nature and character of the employee’s position
(the more senior the employee’s position the greater the
[c] the employee’s length of service (the longer the
employee has been with the employer the greater the notice
[d] the availability of alternative employment in the market
(the harder it is for the employee to find a new job the greater
the notice entitlement).
The Courts have fixed a rough maximum of 24 months for the
reasonable notice period.
An employer that does not give notice, must provide pay in lieu
of that notice. The pay in lieu includes not only base pay, and
also bonuses, pension contributions, car allowances, and in some
cases benefits and stock options, that the employee would have
received during the notice period had the employee worked.
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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Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
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