Peter Straszynski discusses terminations without cause including
the difference between "with cause" and "without
cause" termination and what an employee is entitled to when
terminated without Just Cause as part of the Torkin Manes
LegalPoint Video Series.
Q. What is the difference between a "with
cause" and without cause" termination?
There are basically 2 types of termination of employment by an
employer.... with "just cause" or "without
just cause"..... "Just Cause" exists where an
employee has been guilty of very serious misconduct, dishonesty or
other serious breach of the terms of their employment...... Where
there is just cause, an employee can be fired without any notice or
payment.... Just Cause is very difficult to prove and the
overwhelming majority of terminations are "without just
Q. What is an employee entitled to when terminated
without Just Cause?
In the case of any "without cause" termination, there
are typically 3 important considerations.....
1. Statutory Minimums
First, we have to consider minimum entitlements under the
Ontario Employment Standards Act.... The Act sets out bare
minimum standards for notice or payments on termination.....
It's common for employers and employees to misunderstand these
as "maximum" entitlements or obligations.... This is
wrong.... These standards are "minimums" only. The
statutory minimum standards are the first consideration.
2. Written Contract, if any
Next, we look at any written contract of employment to see if it
says anything about termination entitlements..... Some contracts
set specific entitlements that are different than the statutory
minimums..... These contracts may very well determine what the
employee will be entitled to...... But remember, there are a
variety of technical reasons why the terms of a written contract
may not be enforceable, which any experienced employment lawyer
will be able to identify.... Written contracts are the second
consideration ....If you would like to learn more about Contracts,
see our related video on the topic....
3. The Common Law
If there is no written contract determining entitlements.... or
if the contract is not enforceable for any reason... then the
"common law" applies..... This is the 3rd
consideration..... At common law, employees are entitled to
"reasonable" notice of termination or payments
instead..... There are a few important things to know about
"reasonable" notice or pay...... First, this is what
judges get to decide in "wrongful dismissal" cases....
taking into consideration the employee's age, position and
length of service, it is not unusual for Judges to award in the
range of 1 months' notice or pay per year of service, and
possibly more...... Importantly, this common law notice or pay is
"inclusive" of the statutory minimum requirements that
we've already identified..... And finally, this "common
law" entitlement may be affected where the terminated employee
finds new work quickly...... We call this
Every time we look at a termination of employment, we have to
carefully examine each of the factors discussed in this video, in
order to determine what a particular employee's entitlements
will be. It's not always simple to determine.... Employers are
very well advised to get proper advice prior to implementing any
termination..... It's equally important that employees get
proper advice before signing any release or other agreement in the
context of a termination.
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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