In Max Aicher (North America) Limited, v Richard Bell, and Director of Employment Standards, the Ontario Labour Relations Board (“OLRB”) confirmed that an employer does not owe a statutory duty of procedural fairness to employees when terminating for wilful misconduct.
Background
The Employer is a supplier of hot rolled rebar. The respondent Employee worked in the production of rebar for several years. However, after it was discovered that the Employee engaged in deliberate sabotage of production on two separate occasions, he was terminated for wilful misconduct, disentitling him from any notice of termination or severance pay. Given the conclusive evidence obtained during its investigation, the Employer did not give the Employee an opportunity to defend himself against the allegations prior to termination.
The Employee filed a claim for termination pay and severance pay with the Employment Practices Branch. The Employment Standards Officer (“ESO”) determined that the Employer had failed to provide the Employee with procedural fairness, as he was not given the opportunity to provide his version of events before termination or participate in the Employer’s investigation. Accordingly, notwithstanding the deliberate sabotage, the ESO found the employee was entitled to severance pay and termination pay, and issued an Order to Pay because the Employer did not give the Employee the opportunity to participate in the investigation.
The Employer brought an Application for Review with respect to the ESO’s decision to the OLRB.
OLRB’s Decision
At the OLRB, the Employer made the following submissions:
- The Employee’s acts of sabotage constituted wilful misconduct; and
- Employers do not owe a duty of procedural fairness when terminating an employee under the Employment Standards Act, 2000 (“ESA”).
The OLRB agreed that the Employee’s behaviour rose to the level of wilful misconduct under the ESA. More notably, the Board agreed that the Employer owed no duty of procedural fairness to the Employee under the ESA before terminating his employment.
The OLRB confirmed that nothing in the ESA or its regulations imposes a duty of procedural fairness (including the opportunity to be heard) upon an employer who seeks to rely upon an employee’s wilful misconduct, disobedience or wilful neglect of duty with respect to terminating the employee’s employment:
- There is nothing in the Act of the Regulations which imposes a duty of procedural fairness (including the opportunity to be heard) upon an employer who seeks to rely upon an employee’s wilful misconduct, disobedience or wilful neglect of duty in invoking sections 2 (1) 3 and 9 (1) 6 of Regulations 288/01.
Additionally, the Employer highlighted that the law allows employers to rely on “after acquired cause” in seeking to uphold the discharge of an employee for cause. In such cases, employees will never have the opportunity to provide their side of the story prior to termination. Accordingly, the Employer argued that it would not be possible for employers to owe a duty of procedural fairness at common law. The OLRB agreed, stating the following:
- MANA argued that an employee could never be given the opportunity to answer charges based on after acquired cause because the employment relationship is ended before the cause is even known. Accordingly, they argue that the employer can not owe a duty of procedural fairness at common law. I agree.
Ultimately, the OLRB found that the Employee engaged in wilful misconduct within the meaning of Regulation 288/01 such that he was disentitled to notice of termination and severance pay. Moreover, the OLRB found that the Employer’s failure to provide the Employee with the opportunity to participate in the investigation or provide his version of events prior to terminating his employment did not deprive the Employer of the ability to rely upon the Employee’s misconduct in order to terminate his employment without termination pay or severance pay.
Takeaway
The OLRB’s decision supports the premise that an Employer does not owe employees a duty of procedural fairness under the ESA. Despite this, it is still advisable to fully investigate an incident(s) of wilful misconduct, including speaking to the employee involved, prior to making the decision to terminate the employment relationship.
If you have any questions about workplace law generally, please do not hesitate to contact a Mathews Dinsdale lawyer.
The authors gratefully acknowledge the assistance of Amelia Latour, a Summer Student, in the Firm’s Toronto office.
