It is always a good idea to call your employment lawyer before an employee’s dismissal even if the employee has signed an iron clad termination clause. Most of my clients do so and sometimes the call helps the client save thousands of dollars.
This past week – like most weeks – I had a number of calls from clients who wanted to terminate an employee.
In one case, the employer wanted to terminate a poor performer without just cause. For various reasons, I always want to know the backstory to a potential dismissal so I started asking questions. It turns out the employee was disabled and had very recently requested accommodation. Although I have no doubt the disability had nothing to do with the desire to terminate, the employer had not done a good job of documenting several bona fide performance concerns, had not warned the employee that his employment was at risk, and internal discussions about the dismissal did not take place until after the employee had disclosed the disability. I therefore outlined the additional legal liability the client could assume if the employee were terminated at this particular time. Because the employee had a mental disability and I was concerned a termination might exacerbate this condition, I told the client that the non-termination costs associated with the proposed dismissal could be significant.
Lessons to be learned:
- Make sure every employee signs an employment contract with a legally enforceable termination clause. For blogs discussing how termination clauses are being successfully challenged by employees, click here.
- Always call your employment lawyer before terminating an employee even if the employee has signed a legally enforceable termination clause.
- To avoid additional legal liability, it is sometimes necessary to delay an employee termination. Damages for human rights violations, punitive damages, and the intentional infliction of mental stress can far exceed the termination pay an employee is owed under an employment contract. For blogs discussing non-termination pay damages, click here.
For over 25 years, Doug MacLeod of the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him at 416 317-9894 or at [email protected]
A recent case underscores the importance of including a properly drafted termination clause in your organization’s employment contract. The Facts In March 2010, CIGI hired Mark Menard, a chartered accountant, as Senior Director of Finance. He was responsible for the...read more
If you are a director or a party to a unanimous shareholder agreement did you know that you are personally liable for unpaid wages and you could go to jail for up to one year for failing to pay them? So if you are a small business owner, have signed a unanimous...read more
Some recent changes in the law make Ontario’s employment laws more employer-friendly - especially for small businesses. This blog discusses five of these changes. Eliminating a scheduled increase in the minimum wage Under Bill 148, the minimum wage was scheduled to...read more