When an employee is fired from their job there are a number of legal consequences, and legal requirements that are triggered on behalf of both the employer and the employee. For this reason, decisions to terminate employees should not be taken lightly, and should only take place after the employer has considered the consequences as well as their obligations.
All Employment relationships are governed by the employment contract. The type of employment contract will depend on the nature of the employment.
There are many different types of employment and there are different legal implications for each. Some employees have to be concerned with a collective bargaining agreement or the Canada Labour Code. The majority of employees that I see are governed by the Employment Standards Act.
The Employment Standards Act sets out the minimum requirements of employers. When terminating an employee an employer must give reasonable notice, or pay in lieu of reasonable notice, in accordance with the act unless there is just cause for termination. An employer may also have to pay reasonable notice as determined by common law factors. These factors include the employee’s age, the length of service, nature of the job being performed, and the availability of work in the field.
There are times when an employer may provide “working notice”. This is usually done when an employer knows that the company is winding up or that a position is being terminated and they believe that there is still a good working relationship with the employee.
Employers should be very careful when alleging that there is cause to terminate an employee. Alleging cause and failing to pay the minimum under the Employment Standards Act can be seen as bad faith negotiations and increase the liability of the employer to pay damages to the terminated employee.
If an employee is terminated without cause, they also have legal obligations if they are seeking payment in lieu of common law notice. The Employee has a duty to mitigate their damages by attempting to find replacement employment. If the employee fails to mitigate their damages, they would have great difficulty in winning their claim for wrongful dismissal.
Replacement employment doesn’t mean taking any possible job that is available but seeking out reasonable employment based on the employee’s qualifications. An employer would have difficulty arguing that a long haul truck driver failed to mitigate her damages because she refused to apply for jobs in the financial sector which would have provided the same pay.
If you are considering terminating an employee, or have just been terminated by an employer, I recommend seeking legal advice as soon as possible to understand the legal implications of the termination.
Scott Buchanan is an associate at the law firm of Cobb & Jones LLP. For more articles, visit the Library Page at www.cobbjones.ca.