Many employers have policies about termination, and specifically
about what an employee is entitled to if terminated without cause.
It is a good idea to try to manage the cost of terminations,
but it needs to be done properly to be effective.
Oliver v. Sure Grip Controls is a
recent case where a termination policy was reviewed. The
employer tried to limit its liability by reference to the policy
set out in the employee handbook. The employer had gone to
the trouble of having the handbook reviewed and signed by the
employee, but the handbook included this underlined statement:
I understand that the Sure Grip Controls Inc Management
Team Handbook is not a contract of employment and should not be
deemed as such.
The court decided that the employer, by its own words in the
handbook, had defeated its argument that the handbook limited the
employee's rights on termination.
It is not clear where the statement came from, but we often see
such statements in employment policies that originate in the United
States. There, such a statement is used to ensure that
employment remains "at will" with the employer retaining
the right to terminate an employee at any time without notice or
compensation. That does not work for Canadian employers where
the obligation is to provide reasonable notice in the event of
termination without just cause. That obligation can only be
modified by an enforceable contract that meets minimum employment
standards set by statute. In other words, a Canadian employer
that wants its termination policies to be binding should not have
anything like the statement above.
It is possible to have a policy that manages an employer's
liability for termination without just cause, but it is always
better to have a clear contractual provision to that effect.
You can find a discussion of these issues in our 2013 Client Conference materials here.
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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