Establishing Just Cause Terminations, The Legal Test and Employer Best Practices in Alberta
Terminating an employee for just cause in Calgary, Alberta is one of the most serious steps an employer can take, and one of the most legally perilous. Courts in Canada, particularly under common law, regard dismissal for cause as the capital punishment of employment law. It is reserved for only the most serious breaches of conduct and carries with it the complete forfeiture of notice or termination pay. Because of this, employers must understand that the burden of proof lies with them, and that burden is high.
The legal Test
At the heart of the legal test is whether the employee’s conduct amounted to a fundamental breach of the employment relationship such that it became irreparably broken. Courts assess this through a contextual lens, weighing the nature and severity of the misconduct against the employee’s work history, the nature of their role, and whether the employer applied proportionate and fair disciplinary measures before deciding to terminate. One incident alone, unless it is extremely serious, such as gross dishonesty or theft, rarely justifies summary dismissal. More often, the employer must demonstrate a pattern of misconduct and provide evidence that lesser forms of discipline were attempted and failed.
Consider the Statutory and Common Law Framework in Alberta
Employers often misunderstand the relationship between cause and statutory termination pay. Under employment standards legislation, including Alberta’s Employment Standards Code, certain serious misconduct may relieve an employer of the obligation to provide statutory notice or pay in lieu. However, the common law standard for just cause is usually higher than the statutory threshold. This means an employer may believe they are justified in withholding termination pay but still face liability for wrongful dismissal damages if the court finds the termination did not meet the common law standard. Without careful consideration of both frameworks, employers expose themselves to significant legal risk.
Procedural Fairness
Reducing that risk begins with a consistent and well-documented progressive discipline process. Procedural fairness is key. Employers must investigate, give the employee an opportunity to respond, and maintain records at every stage. Skipping these steps or acting on vague or unsubstantiated claims undermines the employer’s position. Courts have shown they will not hesitate to award additional damages where a termination appears rushed, unfair, or retaliatory.
Common employer missteps include terminating without proper documentation, confusing underperformance with misconduct, and failing to communicate expectations in advance. Terminations that feel reactionary or personal tend to fall apart under scrutiny. The legal consequences of such errors can be costly, not only financially but also reputationally.
Even where ‘just cause’ defence is prove-able, and available to the employer, the easier route of ‘arranged resignation’, when properly negotiated and done would always prove to be a better option in terms of predictability and business case considerations. The Courts must be understood as a last option, especially for employers.
Avoid Boiler Plate Contracts in Alberta
An often-overlooked but critical safeguard is having strong, up-to-date employment contracts and internal policies tailored to the roles within the organization. Generic handbooks or boilerplate agreements are no substitute for documentation that clearly sets out job expectations, standards of conduct, and the consequences for breaching those standards. Courts review these documents when assessing whether the employee understood their obligations and whether the employer provided a fair process. Contracts that are tailored to the individual and compliant with current law can also clarify the definition of just cause, limit common law entitlements, and create a solid foundation for defensible terminations. A clear, consistent policy framework aligned with those contracts reinforces an employer’s position and provides necessary protection when difficult decisions need to be made.
Just Cause- A Legal Threshold, not a subjective judgment in Calgary, Alberta
For business leaders, the message is clear. Just cause is a legal threshold, not a subjective judgment. Employers must approach it with caution, strategy, and documentation. When done properly, with the right contracts, policies, and fair process, an employer can protect the integrity of the workplace while also minimizing exposure to claims that are costly to defend. The best defence to a wrongful dismissal claims often begins long before the termination meeting.
So, What’s the next Step:
It’s never too late to engage experienced legal practitioners to review your organization’s “on-boarding’ documents and employment contracts. With the practical strategy of ‘consideration’, the employer can re-align existing employment contracts to meet the desired legal standards that enable meaningful resolution and disengagement. It is also necessary to begin early to engage and document procedural disciplinary measures and apply those interventionist measures that would show the Court “you tried”. The Courts frown at killing a bumble bee with a sledgehammer. Seeking legal counsel in good time when the termination is brewing or earlier, cannot be over-emphasized.
