In the context of termination, there is often confusion, anger and upset when an employee is terminated but receives no reason as to why. Often, employers do not provide a reason or notice of termination. Can they do that? Is it legal to terminate people without giving a cause?
It depends. If your employer is terminating your employment on a without cause basis, then they do not have to provide a reason for termination. If your employer is terminating your employment for just cause, then reasons should be provided.
What is without cause?
Without cause refers to the right of employers to end the employment relationship at free will. It is without cause situations that employers need not provide reasons for terminating the employment relationship. In Alberta law, there is a mutual right of both employers and employees to terminate an employment contract at any time. However, employers must provide “reasonable notice” or “notice in lieu”.
Reasonable notice refers to providing the employee with enough time to find alternative employment. Often, employers will provide employees with either working notice or a payment in lieu. Working notice is where the employer requires you to work until the end of the notice period while payment in lieu is a lump sum payment for the period of time you should be working. The period of time is determined in accordance with the Employment Standards Code.
In addition to reasonable notice, employers will offer “severance” which is an additional lump sum amount given to the employee in exchange for the employee waiving any claims against the employer. In these circumstances, it is good practice to seek independent legal advice to ensure that the amounts being offered are reasonable.
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What is just cause?
Just cause refers to the employers’ right to terminate an employee where the employee has done something that fundamentally breaks down the employment relationship wherein the relationship can no longer continue. Misconduct, dishonesty and theft are some of the reasons that are used for just cause.
However, in law, every employer has to meet certain thresholds prior to the termination, particularly:
- Any incidents have been prudently investigated, wherein the employee has been given the opportunity to explain;
- The employer disciplines in a proportional manner, i.e. a first time offence for arriving late to work should not result in immediate termination; and,
- The employee should be given the chance to correct the behaviour.
Where an employer terminates an employee for just cause, and the situation warranted the termination, the employer does not have to provide the employee with reasonable notice.
However, if your employer has terminated you for reasons that are not serious enough to break down the employment relationship, or where they summarily terminated your employment, it is always worth it to seek independent legal advice to protect your rights.
Please contact Osuji & Smith for all your employment law inquiries.