Effectively dealing with dismissals and terminations May 2012


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Effectively dealing with dismissals and terminations May 2012

  1. 1. Effectively dealing with dismissals and terminations by Toronto Training and HR May 2012
  2. 2. 3-4 Introduction to Toronto Training and HRContents 5-7 8-17 Definitions Calculating termination pay 18-19 Mass terminations 20-21 Recall rights 22-23 Employment contracts 24-27 Rodrigues case (B.C.) 28-29 Social media 30-31 Constructive dismissal before resignation 32-34 Examples of constructive dismissal 35-36 Examples of summary dismissal 37-44 The act of dismissal 45-47 Transferring an employee where performance has been poor 48-50 The fairness doctrine guide 51-52 Things to consider when terminating employment 53-54 Conclusion and questions Page 2
  3. 3. Introduction Page 3
  4. 4. Introduction to Toronto Training and HR• Toronto Training and HR is a specialist training and human resources consultancy headed by Timothy Holden• 10 years in banking• 10 years in training and human resources• Freelance practitioner since 2006• The core services provided by Toronto Training and HR are: - Training event design - Training event delivery - Reducing costs - Saving time - Improving employee engagement & morale - Services for job seekers Page 4
  5. 5. Definitions Page 5
  6. 6. Definitions 1 of 2Wrongful dismissalConstructive dismissalTerminationTemporary layoff Page 6
  7. 7. Definitions 2 of 2THE LAWFarber v Royal Trust CompanyEvans v Teamsters Local Union No.31Wronko v Western Inventory Service LtdEmployment Standards Act 2000 Page 7
  8. 8. Calculating termination pay Page 8
  9. 9. Calculating termination pay 1 of 9 EMPLOYMENT STANDARDS ACT 2000 An employee who does not receive the written notice required under the ESA must be given termination pay in lieu of notice-this is a lump sum payment equal to the regular wages for a regular work week that an employee would otherwise have been entitled to during the notice period An employee earns vacation pay on his or her termination pay-employers must also continue to make whatever contributions would be required Page 9
  10. 10. Calculating termination pay 2 of 9 EXAMPLE-REGULAR WORK WEEK Elaine has worked for three and a half years but her job has now has been eliminated and her employment has been terminated-Elaine was not given any written notice of termination Elaine worked 40 hours a week every week and was paid $12.00 an hour plus she also received four per cent vacation pay Page 10
  11. 11. Calculating termination pay 3 of 9 EXAMPLE-REGULAR WORK WEEK As she worked for more than three years but less than four years, she is entitled to three weeks pay in lieu of notice. Elaine’s regular wages for a regular work week are calculated: $12.00 an hour × 40 hours a week = $480.00 a week Her termination pay is calculated: $480.00 × 3 weeks = $1,440.00 Page 11
  12. 12. Calculating termination pay 4 of 9 EXAMPLE-REGULAR WORK WEEK 4% of $1,440.00 = $57.60 Finally, her vacation pay is added to her termination pay: $1,440.00 + $57.60 = $1,497.60 Result: Elaine is entitled to $1,497.60 Page 12
  13. 13. Calculating termination pay 5 of 9 EXAMPLE-REGULAR WORK WEEK 4% of $1,440.00 = $57.60 Finally, her vacation pay is added to her termination pay: $1,440.00 + $57.60 = $1,497.60 Result: Elaine is entitled to $1,497.60 Page 13
  14. 14. Calculating termination pay 6 of 9 EXAMPLE-NO REGULAR WORK WEEK Tony has worked at a nursing home for four years- he works every week, but his hours vary from week to week His rate of pay is $12.00 an hour, and he is paid six per cent vacation pay Tony’s employer eliminated his position and did not give Tony any written notice of termination-he was ill and off work for 2 of the 12 weeks immediately preceding the day his termination date Page 14
  15. 15. Calculating termination pay 7 of 9 EXAMPLE-NO REGULAR WORK WEEK Tony earned $1,800.00 in the 12 weeks before the day on which his employment ended, and he is entitled to four weeks of termination pay Tony’s average earnings per week are calculated: $1,800.00 for 12 weeks ÷ 10 weeks (Tony was off sick for two weeks therefore these weeks are not included in the calculation) = $180.00 a week Page 15
  16. 16. Calculating termination pay 8 of 9 EXAMPLE-NO REGULAR WORK WEEK His termination pay is calculated: $180.00 × 4 weeks = $720.00 Then his vacation pay on his termination pay is calculated: 6% of $720.00 = $43.20 Finally, his vacation pay is added to his termination pay: $720.00 + $43.20 = $763.20 Result: Tony is entitled to $763.20 Page 16
  17. 17. Calculating termination pay 9 of 9 WHEN TO PAY Termination pay must be paid to an employee either seven days after the employee is terminated or on the employees next regular pay date, whichever is later EXEMPTIONS Page 17
  18. 18. Mass terminations Page 18
  19. 19. Mass terminationsSpecial rules for notice of termination may applywhen the employment of 50 or more employees isterminated at an employers establishment within afour-week periodForm 1NoticeExceptions Page 19
  20. 20. Recall rights Page 20
  21. 21. Recall rightsWhat are recall rights?An employee who has recall rights and who isentitled to termination pay because of a layoff of35 weeks or more may choose to:keep his or her recall rights and not be paidtermination pay at that time;orgive up his or her recall rights and receivetermination pay Page 21
  22. 22. Employment contracts Page 22
  23. 23. Employment contractsKEY AREAS TO BE ADDRESSED:RemunerationConfidentialityRestrictive covenants (non-competition and/ornon-solicitation)Probationary periodsTermination provisions Page 23
  24. 24. Rodrigues case (B.C.) Page 24
  25. 25. Rodrigues case (B.C.) 1 of 3POINTS TO CONSIDERResist the temptation to summarily dismissdisruptive employees and instead consider thefollowing before making any decisionHas reasonable opportunity to improve beengiven? The longer the service of the employee, themore time must be given to address shortcomings-Rodrigues was a 16-year employee who was givena mere month to improve, then fired after only aday Page 25
  26. 26. Rodrigues case (B.C.) 2 of 3POINTS TO CONSIDERWere there prior warnings?If an employee has never been informed theirbehaviour is unacceptable, the employer haseffectively condoned the behaviour-the employermust inform the employee of the changedexpectations Page 26
  27. 27. Rodrigues case (B.C.) 3 of 3POINTS TO CONSIDERHow specific are the warnings?Vaguely telling an employee they must improvetheir attitude is insufficient-the employer mustclearly spell out in what respects their conduct isdeficient Page 27
  28. 28. Social media Page 28
  29. 29. Social mediaWest Coast Mazda Page 29
  30. 30. Constructive dismissal before resignation Page 30
  31. 31. Constructive dismissal before resignationRusso v Kerr Bros. Ltd Page 31
  32. 32. Examples of constructive dismissal Page 32
  33. 33. Examples of constructive dismissal 1 of 2Unilaterally revising an employee’s contract tointroduce a very narrow termination clause withoutconsideration (i.e. without something in return,such as a bonus payment)Revising an employee’s job description to removesignificant aspects such as supervising a team orleading an important ongoing part of the businessMoving an employee from a corner office to acubicle Page 33
  34. 34. Examples of constructive dismissal 2 of 2Decrease in compensationmoving an employee from straight salary to alower salary with commissionchanging positions into a lower pay scaletransferring an employer to a jurisdiction with ahigher cost of living but no salary increaseremoving a car bonuscutting hours Page 34
  35. 35. Examples of summary dismissal Page 35
  36. 36. Examples of summary dismissalTheft, fraud or deliberate falsification of recordsFighting or assaulting another personDeliberate damage to company propertySerious incapability through alcohol or drug useSerious negligence causing unacceptable loss,damage or injurySerious acts of insubordination Page 36
  37. 37. The act of dismissal Page 37
  38. 38. The act of dismissal 1 of 7Prepare for the meeting at which the dismissal isto take place very thoroughlyBe certain of the facts of the case and the precisereasons the decision to dismiss has been arrived atOrganize practical matters such as pay in lieu ofnotice before the meeting takes placeConsider in advance the likely reaction of theindividual and prepare an appropriate response Page 38
  39. 39. The act of dismissal 2 of 7Talk to employees concerned firmly butsympathetically as it is important that theyunderstand the decision is final, but they should begiven as much practical assistance in planning fortheir future as is possible-including outplacementprograms if appropriateWhere possible avoid the need for employees toleave immediately as this is likely to be humiliatingand cause ill-feeling Page 39
  40. 40. The act of dismissal 3 of 7CHECKLIST:Prior to terminating an employee, review theemployee’s employment contract to determinewhat severance obligations are owed-if theemployee is on a fixed-term contract considerwhether there may in fact be a severanceobligation to the employee by virtue of theexpiration of that contract or the fact that therehave been a series of fixed-term contracts Page 40
  41. 41. The act of dismissal 4 of 7CHECKLIST:When there has been alleged misconduct in theworkplace, employers should ensure that anobjective and thorough investigation is completed-if assistance is needed to conduct theinvestigation, the help of an experiencedworkplace investigator should be sought Page 41
  42. 42. The act of dismissal 5 of 7CHECKLIST:Following an investigation into the allegedmisconduct and prior to making the decision toterminate an employee for cause, the employershould consider whether there is an option otherthan terminating the employee-the level ofdiscipline imposed must be proportional to themisconduct Page 42
  43. 43. The act of dismissal 6 of 7CHECKLIST:Always consider the employee’s explanation ofmisconduct before terminating employmentIf the decision is made to terminate an employee,consideration should be given to other potentialissues that may arise in the termination so carecan be taken to deal with them. These issues mayinclude human rights considerations andemployees who are on leave Page 43
  44. 44. The act of dismissal 7 of 7CHECKLIST:Prepare a termination letter in advance of themeeting and have it ready to give to the employeeat the meeting-also, plan the termination meetingin advance including what will be said, when andwhere the meeting will be conducted, who willconduct the meeting, and possible questions thatmay arise Page 44
  45. 45. Transferring an employee where performance has been poor Page 45
  46. 46. Transferring an employee whereperformance has been poor 1 of 2 National Bank v Chandran (Alberta) Ensure the employee is provided full details of the case against them and is permitted to respond If the employee disputes the facts, conduct an objective investigation Understand that a disciplinary letter warning of termination may ensure a demotion becomes a constructive dismissal, even if it is too minor a demotion to be so otherwise Page 46
  47. 47. Transferring an employee whereperformance has been poor 2 of 2 In deciding whether a demotion might be a constructive dismissal, consider what effect it may have on an employees career progression-the court placed considerable weight on the impact the transfer would have on Chandrans chance of reaching his career goals Page 47
  48. 48. The fairness doctrine guide Page 48
  49. 49. The fairness doctrine guide 1 of 2 Has appropriate training been provided? Is the standard of performance reasonable? Has the standard of performance been tested and found fair? Has the standard of performance been communicated? Do employees understand the standard of performance? Page 49
  50. 50. The fairness doctrine guide 2 of 2 Are all employees meeting the standard of performance? Has a fair investigation been conducted? Is there actual documented proof of a deficiency? Has the investigation been void of discrimination? Is the discipline appropriate? Page 50
  51. 51. Things to consider whenterminating employment Page 51
  52. 52. Things to consider when terminating employmentCause is almost impossible to proveConsidering there is likely to be a pay-out, typicallynever state why the employee is no longer wantedin the organizationHow much notice? Page 52
  53. 53. Drill Page 53
  54. 54. DrillPage 54
  55. 55. Conclusion and questions Page 55
  56. 56. Conclusion and questionsSummaryVideosQuestions Page 56