Fired with cause or without cause – Does it matter?

April 26, 2016

By: Ashley Iyathurai, Law Office of Jeff Jiehui Li

Disclaimer: The information contained in this article is general in nature and does not constitute legal advice. You should contact Jeff Li or another lawyer if you are concerned about your employment issues.

Whether you are an employee, or an employer, it is important to understand when an employer can dismiss an employee without cause. The employment relationship is contractual in nature, and an employer is entitled to fire its employees as it wishes.

However, if an employer does terminate the employment relationship, the employer is required to provide reasonable notice to the employee. What this looks like and how long this notice period will be requires an assessment of a number of different factors.

But, where an employee is fired for cause, the employer is not required to provide reasonable notice to the employee. Because there is no requisite notice period in this situation, the employer is not required to compensate the employee if the employer fails to give reasonable notice. Given that pay in lieu of notice can vary greatly based on an employee’s position and employment contract, this can add up to a substantial amount for an employee. Therefore, being fired with cause can put an employee at a substantial disadvantage by freeing the employer from this notice requirement.

It is important, therefore, to understand what just cause is, and what kinds of behaviour will give rise to just cause. Just cause, sometimes called dismissal for cause, includes:

  • serious misconduct
  • habitual neglect of duty or incompetence
  • conduct that is incompatible with the employee’s duties or is prejudicial to the employer’s business
  • willful disobedience of an employer’s orders

Significantly, however, just cause is not limited to only these types of situations. There is no firm rule as to what will constitute just cause. Each situation will differ and the alleged misconduct will be considered wholly in order to determine if the dismissal is justified. A court will look to the surrounding circumstances, the level of seriousness of the offence, and the extent to which the behaviour has affected the employment relationship.

The misconduct will also be viewed differently depending on the nature of the employment relationship as well. Standards may differ based on the particular workplace, and the employee’s position within the organization. For example, professionals will usually be required to meet higher standards with respect to their conduct. As a result, something that may have otherwise been acceptable if done by someone in a different position may be grounds for cause in the professional context.

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