Two recent Alberta employment law cases clarified the law on just cause for dismissal and calculating reasonable notice.
An Overview of Dismissals in Alberta
In Alberta, an employer needs just cause (a justifiable reason) to dismiss an employee immediately, without advance notice or compensation for their job loss. For all other dismissals (dismissals without cause), the employer must provide notice of termination or pay instead of notice. Each employee is entitled to a different amount of termination notice or pay. This amount depends on Alberta’s employment standards legislation, the employee’s employment contract, and the common law (judge-made law).
A written employment contract may include a termination clause that sets out the rules around terminating an employee. To be enforceable, the clause must meet or exceed the minimum requirements for termination notice and pay set out in Alberta’s Employment Standards Code. If a written employment contract contains an enforceable termination clause, the employee is entitled to the notice or pay set out in the clause. If a written employment contract lacks an enforceable termination clause, or the employment contract is unwritten, the employee has the right to reasonable notice, or pay instead of reasonable notice, under the common law.
A wrongful dismissal is when an employer dismisses an employee without cause and without enough notice or pay instead of notice. An employee who believes their former employer wrongfully dismissed them can sue that employer for damages (compensation). If their action succeeds, the court will calculate their damages based on the termination notice they were entitled to under their employment contract or the common law.
To defend a wrongful dismissal action, an employer might argue that the employee did not take reasonable steps to find new employment after their dismissal (failed to mitigate their losses). If that argument succeeds, the court may reduce the wrongfully dismissed employee’s damages award.
An employer defending a wrongful dismissal action can also argue that it had just cause to dismiss the employee. For just cause to exist, the employee must have been guilty of some serious misconduct that gave rise to a permanent breakdown in the employment relationship. Examples of serious misconduct include dishonesty, insubordination, chronic absenteeism (missing work), and harassment. If an employer proves that it had just cause, the court will dismiss the employee’s wrongful dismissal action because just cause extinguishes the employee’s right to notice of termination or pay instead of notice.
A Misrepresentation in a Job Application Can Provide Just Cause for Dismissal
In the recent case of Tudor v Accurate Screen Ltd, the court found that an employer had just cause to dismiss a recently hired executive employee who misrepresented his academic qualifications in his job application.
In March 2023, the employer, Accurate Screen Ltd. (Accurate Screen), issued a job posting for the role of Vice President (VP) of Business Development. Matthew Tudor applied for the role.
In his job application, Mr. Tudor said he was completing a Master of Business Administration (MBA) program at McGill University and expected to receive his MBA degree in November 2023. That was untrue. When he applied to Accurate Screen, Mr. Tudor was not enrolled in any MBA program and had taken no courses towards an MBA degree.
Accurate Screen relied on Mr. Tudor’s misrepresentation when it hired him. Mr. Tudor started work as Accurate Screen’s VP of Business Development in May 2023.
Accurate Screen began questioning Mr. Tudor’s qualifications after he performed poorly on a forecasting project involving statistical and quantitative analysis. The company then discovered Mr. Tudor’s misrepresentation. In January 2024, Accurate Screen immediately terminated Mr. Tudor’s employment for cause.
Mr. Tudor sued Accurate Screen for wrongful dismissal. Accurate Screen defended the lawsuit, arguing it had just cause to terminate Mr. Tudor’s employment.
The Court confirmed the factors to consider when determining whether an employer had just cause to dismiss an employee: the nature and extent of the employee’s misconduct, the surrounding circumstances, and whether immediate dismissal was a proportional response. After considering these factors, the Court concluded Accurate Screen had just cause to dismiss Mr. Tudor.
In reaching its decision, the Court said: “Embellishing one’s academic qualifications is not a mere error in judgment. It goes to the very heart of one’s moral compass and ultimately their abilities”. The Court found that Mr. Tudor intended to deceive Accurate Screen with his job application. It concluded that his dishonesty (misrepresentation) was serious enough to give Accurate Screen just cause to terminate his employment without notice or pay instead of notice. The court dismissed Mr. Tudor’s wrongful dismissal action accordingly.
A takeaway from Tudor v Accurate Screen Ltd is that a serious and intentional misrepresentation in a job application can be fatal to the employment relationship. Depending on the nature of the misrepresentation, the employee’s position, and its effect on the employment relationship, the employer may have just cause to terminate the employee.
How Much Termination Notice is Reasonable?
Another recent case, Dufour v Ricky’s Family Restaurants Ltd., FDF Brandz Inc., Humpty’s Family Restaurants and Humpty’s Restaurants International Inc. [Dufour v Humpty’s Family Restaurants], shows how courts deal with wrongful dismissal claims and calculate damages in such cases.
The plaintiff, Mary Dufour, worked as a server/cashier at a Humpty’s restaurant for nearly 10 years. She was a competent, valuable, and dependable employee.
On March 13, 2024, Ms. Dufour’s employer advised that her employment would end on April 22, 2024. The employer gave Ms. Dufour 40 days’ termination notice.
Ms. Dufour was 65 years old when her employment was terminated. She had a grade 12 equivalency certificate and past experience working as a server/cashier in the restaurant service industry. She tried to find new employment but was unsuccessful.
Ms. Dufour sued her former employer for wrongful dismissal. She claimed that 40 days’ termination notice was insufficient. Because Ms. Dufour did not have a written employment contract, she was entitled to reasonable notice, or pay instead of reasonable notice, under the common law.
The Court confirmed the factors it must consider to determine the reasonable notice an employee should receive. These factors include:
- the nature of the employment (the employee’s position);
- the length of the employee’s service;
- the employee’s age; and
- the availability of similar employment, considering the employee’s experience, training, and qualifications.
After considering those factors, including the difficulty of finding restaurant server/cashier positions for people over 65, the Court concluded that Ms. Dufour had the right to 11 months’ notice, much more than the 40 days’ notice she received.
The court awarded Ms. Dufour nearly $20,000 in damages (compensation) for her wrongful dismissal. It calculated her damages award based on the salary she earned while working at the Humpty’s restaurant and the additional notice she should have received.
The Court rejected the employer’s argument that Ms. Dufour failed to mitigate her losses by taking reasonable steps to find new employment. Following her dismissal, Ms. Dufour applied for around 50 jobs, mostly through hand-delivered résumés and telephone calls. The Court found these efforts reasonable given Ms. Dufour’s circumstances, emphasizing that mitigation efforts need not be perfect.
A takeaway from Dufour v Humpty’s Family Restaurants is that long-serving, older employees who work in unskilled positions and have limited job prospects may be entitled to a significant period of notice, or pay instead of notice, under the common law.
Key Takeaways
The two employment law decisions discussed in this article show that the circumstances of a dismissal matter. Serious misconduct, including dishonesty during the hiring process, may give an employer just cause to dismiss an employee without notice or pay instead of notice. When there is no just cause, the amount of notice or pay an employee is entitled to will depend on their employment contract or, if the common law applies, on factors such as their length of service, age, position, and prospects for finding similar employment.
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DISCLAIMER The information in this article was correct at time of publishing. The law may have changed since then. The views expressed in this article are those of the author and do not necessarily reflect the views of LawNow or the Centre for Public Legal Education Alberta.
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