Employment Law (Ontario) - Dismissal for Cause - Misconduct
BY: Katherine L. Wood, B.A., LL.B.
Part III.6.(a)-III.6.(b).(i) Common Law of Employment - Dismissal for Cause - Misconduct
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III.6.(a): Dismissal for Cause - General
An employer may terminate an employment contract for just cause without giving notice to the employee. In cases where the employment contract is terminated without cause, the employer must give reasonable notice or provide pay in lieu of reasonable notice. Dismissal without cause and without sufficient notice or pay in lieu of notice is wrongful dismissal.
A contract of service may provide that the employer has the right to dismiss the employee at any time for incapacity or breach of duty, and that the employer is to be the absolute judge as to the manner in which the employee performs his or her duties. Where there is such a provision, the employer need not show sufficient cause for dismissal, as the power of dismissal has been submitted to the sole, absolute judgment and discretion of the employer. The degree of reasonableness required in arriving at the decision may depend on the terms of the contract and the circumstances of the case.
Dismissing an employee for a reason which does not fall within the ambit of a clause allowing termination for specified reasons repudiates the contract, which is rescinded if the employee accepts the repudiation. The employer may not thereafter attempt to raise the contractual power of termination as a defence to a wrongful dismissal action.
If an employee has been guilty of serious misconduct, habitual neglect of duty, incompetence, conduct incompatible with the fulfilment of his or her duties or conduct prejudicial to the employer's business, or has been guilty of wilful disobedience of the employer's orders in a matter of substance, the law recognizes the employer's right to summarily dismiss the delinquent employee.
In dismissing an employee for cause, the employer need not state the grounds for dismissal.