Employment law Victoria BC

Wrongful Dismissal

This outline is selective and topical, for discussion purposes only. It is not legal advice. Do not apply any of the information set out in this outline prior to discussing it with your lawyer. Velletta & Company represents both employers and employees. This article contains information to assist you with understanding your rights.

Disclaimer

Employee Information

1. What is “wrongful dismissal”?

“Wrongful dismissal” is a legal definition. If your employer fires you without good reason (“just cause”) they must give you proper notice that your job is ending, or financial compensation in place of this notice (“reasonable notice”). If your employer fails to give you reasonable notice you are wrongfully dismissed. In British Columbia, when an employer lets go an employee, they must comply with the minimum standards set out by the Employment Standards Act. This law entitles an employee to expect a minimum of one week’s pay after three months of employment, to a maximum of up to eight weeks pay after eight years or more. However, these are the bare minimums, and you may be entitled to much more compensation under the common law (decided cases) — up to 24 months in some cases! If you are a member of a union, a collective agreement may protect you.

2. Who has a claim for wrongful dismissal?

Anyone fired or laid off may be entitled to financial compensation from their employer. But, if you are thinking about quitting your job, talk to a lawyer before resigning. In many cases, no matter how bad your situation is at work, if you quit or resign, you may lose all rights to any compensation unless they situation is handled properly.

3. What is “just cause”?

“Just cause” is serious. If you steal from, lie to, or cheat your employer, courts will usually find your employer had “just cause” to fire you, and under these circumstances, your employer does not have to give you any notice or pay you any compensation. For practically all other cases, before firing you your employer should warn you first in writing and give you a chance to remedy any failings. You can’t (and shouldn’t!) be fired just because business is bad or you are no longer needed, unless you are paid the compensation you deserve.

4. How do I know if I’ve been given “reasonable notice”?

Notice is the amount of warning that your boss must give you before you are fired. Compensation is the salary you would have earned during the notice period. As stated above, you may be entitled to up to 2 years of pay, as well as fringe benefits during the notice period. It all depends on the type of job, how long you’ve been employed, your age, and the chances of finding similar employment.

5. What happens if I find another job?

If you find another job at the same or better pay and working conditions, your entitlement to compensation will be reduced. But if you have been wrongfully dismissed, it is important that you look for similar employment. The law requires you to lessen your losses by looking for a similar job. If your former employer can prove that you have failed to seek other employment, your former employer may not have to pay you as much for his wrongful actions.

6. How do I get help?

If you are having trouble with your employer or have been fired, it is important to understand your rights. When an employer treats you unfairly, your lawyer can represent you. Sometimes a letter from your lawyer will be enough to get you the compensation you deserve. In other cases it will take a lawsuit. If you are a member of a trade union, talk to your union representative. If you are not a union member, a lawyer can help you to decide what compensation is owed to you. This article provides general information for employees. If you have any questions or wish to comment on any of the information in this article please click here .

Employer Information

1. Are you thinking of terminating an employee?

Terminating an employee is extremely complicated in British Columbia, and it is important that you are well informed in order to protect your rights and prevent future litigation. If you are having trouble with an employee, it pays to understand your rights as well as the rights of the employee under the law before terminating his or her employment.

2. Do I have to pay the fired employee severance pay?

Unless you have very good reasons for firing your employee, you will likely have to provide the employee with working notice, or with some financial compensation in lieu of that notice. In British Columbia, there are three different standards that may apply when you sever an employment relationship. They are:

a) the Employment Standards Act;
b) common law (decided trial cases); and
c) collective agreement (for union-based employees).

The Employment Standards Act is a law that sets the bare minimum standards for compensation and conditions of employment in the Province. When an employer terminates an employee, this law provides that an employer must pay out the employee as little as one week’s pay or as much as eight week’s pay. Depending upon the circumstances, the common law may allow additional compensation rights to a former employee. In fact, in some cases you may be required to pay out as much as 24 months salary to a fired employee! Monetary common law obligations are fact-driven and informed by previous legal decisions. Factors such as age, seniority, managerial responsibilities, and the availability of similar employment all go into these calculations. Ask your lawyer for help fashion a package which will avoid difficult and demoralizing litigation.

If your employees are unionized and have a collective agreement, termination may be governed by that contract. It is strongly recommended you consult with a lawyer prior to termination to evaluate how much compensation you should be paying out.

3. What if I had good reasons to fire my employee?

You may think you have good reasons to fire an employee, but the law may dictate otherwise — you have to have “just cause.” Just cause is a legal description. In cases of theft, fraud, dishonesty or blatant insubordination courts will generally find that an employer is within their rights to fire the employee without warning and without compensation. Unfortunately, most cases are not that black and white.

If you wish to terminate an employee for just cause, it is extremely important to document the employee’s failings in his or her personnel file. The employee should get written warnings and an opportunity to correct their failings before termination is considered. Unfortunately, economic difficulties on the part of the employer are not just cause. You cannot fire an employee or lay them off just because business is bad, unless you are prepared to pay them compensation. Remember, it is important to determine whether you have legal just cause. to fire an employee before you fire him or her.

4. What is “the duty of good faith”?

The Supreme Court of Canada has recently added a new wrinkle to the difficulties employers face in firing an unproductive employee. The “duty of good faith” requires employers to treat fired employees with honesty, dignity and compassion when firing them. Failure to do so can cost you additional damages on top of any severance pay you might owe the employee. Before you run afoul of this requirement, get competent legal advice.

Summary

If you are planning to terminate an employee, or are being sued by a former employee, you should speak with a lawyer immediately. Your lawyer will help you to determine whether you have just cause for the termination. He or she can also help you calculate reasonable notice periods, and structure a termination agreement which may prevent future costly litigation. Your lawyer will work to represent your interests in making the process as painless and risk free as possible.

Call our office to arrange for a free, initial consultation with Michael J. Velletta to discuss your real estate, corporate or business matters.