Navigating the complexities of just cause termination can be a daunting task for any employer. The case of Arbor Tech Utility Services Ltd v Coderre serves as a crucial reminder of the legal standards and obligations employers must meet when dismissing an employee for cause. This blog explores the importance of progressive discipline, the necessity of providing employees with a genuine opportunity to improve, and the potential legal consequences of rushing the termination process.

Employer Pays For Just Cause Termination

In Arbor Tech Utility Services Ltd v Coderre (“Arbor Tech“), the Alberta Labour Relations Board (“the Board”) upheld the lower decision of an Employment Standards Officer, which held that an employer had failed to establish just cause and owed termination pay after dismissing its former worker without notice. In doing so, the Board illustrated some important aspects of just cause dismissals.

The Board in Arbor Tech demonstrated that demonstrating just cause is not only a matter of documenting a progression of disciplinary steps. Instead, progressive discipline requires providing employees under review with a real and substantive chance to improve their behaviour. When employers provide written warnings following real instances of insubordination, they also need to ensure that such disciplinary actions are followed by a reasonable period of time in which the employee can correct their mistakes.

Insufficient Grounds for Dismissal

The employee in Arbor Tech had been employed as a safety administrator for one year when she was dismissed for just cause in August 2023, receiving no notice or termination pay. In the employee’s termination letter, she was described as having engaged in “poor performance and insubordination”. The employee’s performance issues arose from her failure to satisfy the expectations of her role, and her insubordination derived from her repetition of mistakes after she had been notified of them.

Specifically, the employee had engaged in a course of misconduct that included failing to follow chain of command, failing to move boxes as instructed, failing to follow dress code, keeping an inaccurate personnel list, and lacking accuracy in her work. This trend resulted in a number of disciplinary actions that involved four separate verbal warnings and one written warning, all over the course of five months.

Employer Failed to Provide Opportunity for Performance Improvement

The final written notice, delivered on August 14th 2023, was followed up by a review of her work by her supervisors. During that review, the employee’s supervisors identified several more errors. On August 16th 2023, just two days after delivering the written warning, the employer terminated the employee for just cause.

In response, the employee filed a complaint under the Alberta Employment Standards Code, rejecting the employer’s allegations of cause and asserting that she was owed termination pay. Ultimately, the Board agreed that she had been wrongfully dismissed for cause, finding the employer had failed to provide a reasonable opportunity to improve performance following the written warning. The Board remedied the employer’s breach of the Employment Standards Code by awarding the employee one week’s wages in lieu of notice.

Importance of Timing

With so much focus on generating a reliable paper trail, employers considering a dismissal for cause can forget the importance of timing their actions correctly. While there are no strictly defined timelines for disciplinary action, Arbor Tech provides an example of a court making clear that employers must provide enough time for their workers to improve before considering dismissal for cause.

By opting to follow a final warning only two days later with a termination letter, the employer in Arbor Tech demonstrated that it had no intention of permitting the employee to improve. Although the employer may have taken a proportionate approach to discipline, its decision to dismiss without providing sufficient time to improve performance left it liable for termination without providing termination pay.

Following Procedures Not Enough

Employers who feel empowered to deprive employees of termination pay merely by issuing a written warning are courting disaster. While documenting every disciplinary step is necessary, it is by no means sufficient to justify a dismissal for cause. The principle behind termination procedures is, after all, to ensure that employers have provided employees a reasonable chance to maintain their employment by fixing their conduct.

Abusing the Disciplinary Process

While this case might be worrying for employers who seek to understand the exact number of days required for a dismissal for cause, it should also bring a sense of clarity as to the purpose of progressive discipline. A progressive and gradual approach to discipline, which is commonly demonstrated by having clear and detailed records, is a means of ensuring that employees who demonstrate competence will be protected from being dismissed without notice.

While employers are entitled to dismiss for cause workers that demonstrate an inability to maintain performance standards, they are not entitled to use the disciplinary process as a shortcut to depriving competent employees of their jobs without notice. Not only can doing so result in awards for termination pay, in some cases, it can expose employers to liability for constructive dismissal.

Proof of Insubordination Not Enough

Another aspect of Arbor Tech follows from the necessity of giving time to correct mistakes or fix issues. Although the employer in this case failed to give the employee a sufficient shot to improve, it did document a trend of poor performance. The employer, in other words, did have grounds for dissatisfaction with the employee’s performance.

In fact, the employee’s trend of incompetence was so consistent that the employer felt it rose to the level of insubordination. Whether the employee’s conduct was intentional or merely negligent, Arbor Tech undoubtedly involved an employee with performance issues. The presence of such issues illustrates the reality that even a regular trend of mistakes or carelessness is not enough to justify a dismissal for cause.

Enabling Improvement is Key

Alberta’s legal system, instead, expects employers to give employees the benefit of the doubt, permitting them in most cases to correct mistakes or misconduct. While acts of highly inappropriate conduct are exceptions to this rule, employees who fail to meet expectations are generally entitled to multiple opportunities to fix performance issues. This ensures that employees have some control over their employment and prevents employers from taking rash action against their workers when they make mistakes.

Reliable Alberta Employment Lawyers Are Here To Help

Through their decades of experience, the labour and employment lawyers at Getz Collins and Associates can advise on a multitude of legal matters. From understanding just cause for termination to what constitutes a fair performance management system in a workplace, our team is here to help. Based in Calgary and Strathmore, Getz Collins and Associates proudly represents clients in all surrounding communities, including Airdrie, Cochrane, Okotoks, Drumheller, Chestermere, and Hussar. To schedule a consultation, please contact us online or call 587-391-5600.