Resignations: Will I Stay Or Will I Go?

When it comes to resignations, the facts matter and the decision of Nagpal v. IBM certainly proves it. In another notable case on resignations in Ontario, Schabas J. had to determine whether an employee's failure to return to the workplace after his disability benefits were denied amounted to voluntary resignation or abandonment of employment.

This case also deals with some interesting issues of when policies can be incorporated by reference but that is a topic for another day.

The Fixed-Term Employment Contract: It's Your Funeral

fixed term contract
Ontario's Superior Court of Justice has issued a stark reminder of the perils of fixed-term employment contracts. In McGuinty v. 1845035 Ontario Inc. (McGuinty Funeral Home),1 released in July of this year, the Court awarded nine years worth of wrongful dismissal damages to an employee whose fixed-term contract was terminated early by the employer. Read More...

Risky Business: Alleging Cause If You Don't Have It

you are fired
So you have a problem employee that you want to terminate. Your employment lawyer reminds you that you would owe nothing to the employee in a "for cause" termination, but that it's unlikely that you could prove cause in the circumstances. She then goes on to assess your common law reasonable notice obligation in a "without cause" termination as being somewhere in the 10 to 12 month range.

You decide to take the risk and terminate the employee alleging cause. You feel that the employee is undeserving of a large termination payout and, in any event, hope that alleging cause will put pressure on the employee to go away or, at the very least, accept something far less than if terminated without cause.

While this strategy may work some of the time, it can also backfire. Below are two case summaries of recent decisions where employers learned the hard way to exercise caution when alleging cause.

Bonus Entitlement On The Basis Of Reasonable Expectation

A discretionary bonus may not be discretionary upon termination of employment. If a bonus has become an integral part of an employee's compensation, an employee may be entitled to that bonus during a reasonable notice period. In making this determination, courts will consider factors such as whether a bonus is received each year, whether bonuses were historically awarded, whether the employer had ever exercised discretion against the employee and whether the bonus constituted a significant component of the employee's overall compensation.

In a recent decision, the BC Supreme Court found that where, over the course of employment, a discretionary bonus has been awarded in a way that leads the employee to believe that the discretion will be exercised in the employee's favour, an employer's refusal to pay the bonus in a manner that is not fair or transparent can lead to a finding that the employer has breached the employee's contractual rights.

Can My Employer Dismiss Me Due To My Unseen Disability?

Employers should investigate further before immediately dismissing employees for violating workplace drug and alcohol policies. An employee's diagnosis of substance dependence would be considered a disability, which is a protected ground under the Canadian Human Rights Act (CHRA) for federally regulated employers. Read More...