It is a natural instinct for employees, having just suffered the devastating news of losing their job, to focus on the “why.”
“But I just had great performance review!”
“But they replaced me with someone more junior!”
Unfortunately, these sentiments – which seek to point out that the dismissal is not warranted or is not “fair” – are seldom relevant to the legal question of wrongful dismissal.
It is a very common misconception that the “wrongful” part of “wrongful dismissal” describes the reason for the dismissal – in other words, that the rationale was baseless. But that is not what wrongful dismissal is about.
Wrongful dismissal is not “wrong” because the employer had no good reason for the dismissal; it is “wrong” because the employer failed to provide enough notice or enough compensation to the employee at the time of the dismissal.
Most employers in Ontario can effectively hire and fire on a whim. Your employment lawyer will still have to determine whether the compensation and/or notice provided or offered is appropriate and lawful. But, in most cases, the employer need not show any sound basis or explanation for the decision.
Employees are often told their dismissal is due to “restructuring.” This leaves many employees frustrated and scrambling to make sense of this concept.
“But they replaced me with someone else!”
“Why did I get fired by my colleagues didn’t?”
“Restructuring” is often just code for “our business decision to fire you is not something we care to explain.” And, in most cases, there is nothing legally wrong with that.
Exceptions to every rule
There are, of course, exceptions to every rule.
Unionized employees are often protected by “just cause” provisions in their collective agreements. These provisions often provide job security to employees unless the employer can show “cause” (i.e. that the employee did something terrible to justify getting fired). Most employees in Ontario, however, lack any such security.
Another exception is found in federally-regulated workplaces (such as banking, transportation and telecommunications). A small segment of workers in Ontario work for industries that are governed by the federal Canada Labour Code, instead of the provincial Employment Standards Act. The Canada Labour Code contains a unique requirement that employers must have a good reason before dismissing most employees. The Labour Code imports the same kind of job security found in unionized workplaces, into non-union, federal workplaces.
When reasons really are “wrong”
We’ve just explained how employers usually don’t have to show a good reason for firing someone. That is not to say that a bad reason for firing someone can’t be relevant. There are a few reasons which an employer cannot point to as the rationale for dismissing someone. For example, the Ontario Human Rights Code prevents employers from firing someone because of their age, sex, disability, religion, or other protected grounds. When an employee claims that their dismissal was motivated by discrimination along one of these Code-protected grounds, then the reason for dismissal becomes legally relevant.
Similarly, employers can’t fire someone for standing up for their statutory rights such as those set out in the Employment Standards Act or the Occupational Health and Safety Act. Where an employee claims their dismissal was a result of their inquiry or demand for compliance with these statutes, the claim is called a “reprisal” claim and, again, the reason for dismissal becomes legally relevant.
Leaving aside the exceptions above, the reason an employer decides to fire someone is usually their business, and their business only. A lack of good reason does not make a dismissal “wrongful.” It is an employer’s failure to abide by the common law standard of reasonable notice (or to provide compensation in lieu thereof) which turns a dismissal into a “wrongful” one.
Employees should always consult a local employment lawyer when their employment comes to an end to ensure that they are being treated fairly and in accordance with the law.
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