Not a Lexis+ subscriber? Try it out for free.
LexisNexis® CLE On-Demand features premium content from partners like American Law Institute Continuing Legal Education and Pozner & Dodd. Choose from a broad listing of topics suited for law firms, corporate legal departments, and government entities. Individual courses and subscriptions available.
Yes, this is a crummy subject, for both sides of the issue. I have yet to meet an employer or HR person who looks forward to that awkward meeting, where they need to pull the plug. Even amicable separations are full of potential anxiety about how to treat each other fairly, while advocating for oneself.
Here are my top 5 tips for employers who have to do the difficult deed:
1. REALLY FOR CAUSE? Decide whether the termination is “for cause” (no notice or pay in lieu of notice required) or “without cause” (notice or pay in lieu required). The vast majority of terminations in Canada are characterized as “without cause” because it is very difficult to meet the “for cause” threshold in our courts. It is typically much cheaper to pay out at least a modest package than to drag everyone’s dirty laundry through an expensive court case to prove that someone didn’t “fit” or was not “meeting expectations”. Don’t forget to consult the employment contract, if any, to determine any contractual provisions that may apply to the termination.
2. THE LETTER: Assuming you decide it is a “without cause” termination, prepare a termination letter that sets out very clearly that the employment relationship will be over on a specified date. The Ontario Employment Standards Act requires employers to terminate employment in writing, and you want to avoid any miscommunication as to when the termination is effective and whether it was just some sort of temporary workplace discipline or time out.
3. THE MEETING: Whenever possible, conduct the termination in person, in a discreet area of the workplace. Prepare a brief script ahead of time and be ready to answer the inevitable question, “Why?”. Be equally prepared that you will never be able to answer the question to the employee’s full satisfaction. No one wants to hear that they are just a little bit incompetent, or are a terrible listener who could never accurately follow instructions, or that they are just not as good as the person in the cubicle next to them despite best efforts. Be honest, but be brief, and be clear that the decision is final. Hand them the termination letter for them to review at home. Don’t expect it to be a pretty meeting with happy hugs at the end, but there’s also no reason why it should be hostile in most situations.
4. THE ELECTRONIC DATA: Work with your IT folks – you never know how the employee will respond, and it’s always smart to capture the company’s data, and particularly the employee’s emails and any other key corners of the server to which the employee would have access. By preserving the information ahead of time, you avoid having to walk the employee out in many cases. Don’t forget to request and review any work-issued laptops, tablets, phones, etc.
5. THE RELEASE: If you are offering anything above the Ontario Employment Standards Act, get the employee to sign off on a release in exchange for such amounts. Employers must give at least the statutory amounts, but anything on top is the discretionary bucket for which the employer will want a release from all future liability arising out of the employment relationship.
Terminations are an inevitable part of any growing company, despite the most earnest and well-meaning leadership. Sometimes employees really will be happier in another workplace and you’re doing them a favour by pulling the plug. For those that thought they would be the next VP of Everything at your company, well, hopefully they’ll quickly land on their feet and forget all about suing you for not recognizing their awesome potential.
For additional updates, please visit Lisa Stam's blog, Employment and Human Rights Law in Canada
For more information about LexisNexis products and solutions, please connect with us through our corporate site.