Wrongful Dismissal in Ontario

Robert S. Greenfield

The term “wrongful dismissal” has led to much confusion for employees who want to know their rights after their employment has been terminated. The lawyers of Heydary Hamilton recognize that losing one’s job is stressful and confusing, and we hope this article will help you decide whether you should seek legal advice if you have been fired from your job or are having problems at work.

What’s “wrongful” in wrongful dismissal?

Many employees are surprised to learn that they do not have a right to keep their job. The truth is that an employer that wants to fire a worker is free to do so without even giving a reason. But when an employer does dismiss an employee, the employee is usually entitled to advance notice.

Most employers do not wish to give their employees any advance notice, and are required to pay the employee an amount of money to make up for that notice. This payment is also known as “pay in lieu of notice.” What makes a dismissal “wrongful” is when the employer neither gives advance notice nor gives the employee the proper amount of pay in lieu of notice.

How is the amount of notice determined?

The amount of pay in lieu of notice a former employee should receive depends on a combination of many factors such as the employee’s age, length of employment, and type of work performed. Generally, an employee with a long period of service with a company will be entitled to a larger payment than a similar employee with a shorter amount of service time.

In addition to evaluating the proper amount of notice, legal counsel can be helpful in ensuring you receive all employment benefits you are entitled to, including vacation pay, bonuses, outstanding commissions, stock options and any other compensation you should receive.

“Just cause” is an exception

An employee who is fired for just cause is not entitled to any payment or notice from the employer. Examples of just cause are when an employee steals from his or her employer, physically assaults another worker, or commits some similar severe misconduct. However, just because an employee may have done something wrong at work does not mean that there is just cause. Employers are frequently required to give a warning or impose some other form of discipline to an employee before terminating employment. For instance, a long-time employee who showed up late to work a few times and is fired will probably win a wrongful dismissal case and be entitled to damages. Even if you admit you made a mistake that led to the decision to fire you, you should check with a lawyer to determine whether you might still have a case for wrongful dismissal.

Quitting is another exception

An employee who decides to quit his job is not entitled to any notice payments from the employer, no matter how much service time there may be. The one exception to this is constructive dismissal, discussed next.

Constructive dismissal, or being forced to quit

It may sound strange, but sometimes an employee can be discharged without either the employee or employer even knowing it. A “constructive dismissal” is when an employer changes an employee’s work duties, salary, or other work conditions to the point that the employee essentially no longer has the original job he or she was hired to do. Another type of “constructive dismissal” is when the employer creates a work environment that is so unreasonable that the employee is forced to quit. When this happens, the employee is legally entitled to be treated as if he or she has been fired, and the employer would have to pay appropriate notice and other benefits to the employee. This is a complex area of law and you should consult with a lawyer if you think you may have a case of constructive dismissal.

Discrimination is another story

While an employer does not need to give a reason for dismissing an employee, if the reason turns out to be related to the employee’s religion, gender, race, disability, or other prohibited factors, that is a violation of the employee’s human rights and is illegal. The Ontario Human Rights Commission investigates these issues, but a fired employee might instead be able to bring a case for wrongful dismissal based on discrimination.

Union members

The information in this article does not apply to employees who are part of a union. If you are in a union, you should contact your union representative immediately if you have been disciplined or discharged.