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Study Notes for HRM 3420 Final Exam.doc

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Department
Human Resources Management
Course
HRM 3420
Professor
Chris Sweeney
Semester
Winter

Description
Study Notes for HRM 3420 Final Exam Chapter 15 – Dismissal Without Cause An employer does not need just cause to dismiss a non-unionized employee. Provided that dismissal doesn’t infringe a statute, an employer may dismiss such an employee as long as the employer provides notice of dismissal or payment in lieu of notice. Serious Misconduct = “just cause”, then NO reasonable notice of termination is required  Downsizing/economic reasons ≠ “just cause”, the reasonable notice or pay in lieu is required. FRUSTRATION OF CONTRACT Sometimes an employment contract might come to an end without notice as a result of unforeseeable consequences (floods, fires, explosions or if employee goes to jail or loses necessary license to perform the job)  The situation is however problematic when an employer alleges frustration of contract because of an employee’s prolonged illness. Under Ontario Human Rights Code, the employer must accommodate a disabled employee unless it creates an undue hardship. Example Of Contract Being Frustrated Because Of Employee’s Physical Incapacity Demuynck v. Agentis Information Services Inc. (2003) FACTS: Demuynck work for the employer as a clerk for 18 years. In 1996, she injured her right elbow in a fall unrelated to work. She continued working until mid-1997, but then left work and began to receive short-term disability benefits. Her doctor postponed the date of return 4 times. Eventually, the employer sent her a letter of termination, which didn’t mention frustration of the contract, but instead was saying that the employer is undergoing a considerable change. She was offered 12 month of pay in lieu or a “top up” of her earnings if she became employed. She rejected and sued for damages equivalent to 16-18 months of pay in lieu of notice. ISSUE: whether the contract of employment became frustrated by the employee’s physical incapacity. DECISION: The court found that the employment contract had become frustrated and Denuynck wasn’t entitled to wrongful dismissal damages. Frustration of contract occurs when an employee’s incapacity of such a nature that the further performance of employment duties is impossible or would be radically different from what was outlined by the contract. In determining whether a contract had been frustrated, a court is going to consider a number of factors, such as: 1) The term of contract, including provisions relating to sick pay(if employee can be back to work within the time of the sick days provided) 2) How long the contract was likely to last in the absence of sickness (indefinite v. contract) 3) The nature of employment (is the employee easily replaceable or holding a key position) 4) The nature of illness or injury (the length of recovery) 5) The employment history (long-term relationship is not likely to be frustrated) WRONGFUL DISMISSAL How much notice is reasonable?  an employer must ensure that its separation package at least meets the statutory minimum requirements set out by the Ontario Employment Standards Act, 2000.  then an employer must assess what constitutes reasonable notice under the common law. Under the common law, the answer depends on the unique circumstances of every particular case. Bardal v. The Globe and Mail Ltd. FACTS: At that time, Bardal disclosed to the employer how important it was to him that the position being offered be permanent, given his age. Once hired, Bardal advanced through the company. After 17 years of service, the employer asked Bardal for his resignation in order to reduce company costs. When Bardal refused to comply, the employer sent him a letter of termination of employment without notice. Bardal was successful in obtaining employment, albeit at a lower salary. ISSUE: what constitutes reasonable notice, given the circumstances of the contract. DECISION: 1 year notice for Bardal Bardal factors to be considered when granting a separation package: 1) the employee’s age 2) the employee’s position 3) the employee’s length of service 4) the employee’s level of compensation 5) the availability of similar employment, given the employee’s experience, training, and qualifications.  The Notice Period Is Not Equivalent To Time It Takes To Find A New Job Bain v. insurance Corp. of British Columbia (2002) FACTS: 57y.o. Bain had worked as a junior manager in IT department for 7 years when the employer dismissed him. The employer gave him a 7-months’ pay in lieu of notice, but he sued for additional damages and argued that he should receive 18-20 months notice due to scarcity of IT jobs on the market during the economic recession. ISSUE: whether the wrongful dismissal should reflect the current economic climate. DECISION: the Court held that the appropriate notice period is not equivalent to the length of time that takes an employee to find a new job. Economic situation is considered as one of the factors in determining the reasonable notice period, but it should not receive undue weight. Bain was entitled to 12 months of pay in lieu on the basis of Bardal factors in his case. Jamieson v. Finning International Inc. – the Court awarded an employee a longer notice period because his job skills as a millyard systems manager in the heavy equipment supply industry were so specialized that there were limited opportunities for him to find similar employment. In 1999, the Court rejected the rule of “one month of notice for every year of service” in Minott v. O’Shanter Development Co., stating that it undermined the flexibility of the Bardal test by overemphasizing the length-of-service factor.  Cronk v. Canadian General insurance Company confirmed the principle that senior-level employees are entitled to lengthier period of notice. (see cases document) However, there’s one case where a lower skilled position was awarded more than 12 months’ notice  Russo v. Lawrence Park Medical Centre Ltd. (2002) FACTS: 67y.o. Russo had worked for the employer for 25 years as a parking lot attendant. Upon termination, the employer provided her with 21 weeks’ notice. She sued for wrongful dismissal damages. ISSUE: whether the notice period was appropriate in the circumstances. DECISION: the Court held that Russo was entitled to 13 months’ pay in lieu of notice and that lower-level employees are not bound by a 12- month ceiling on reasonable notice. All relevant Bardal factors should be taken into account. In this case, Russo was 67 y.o., spoke little English, was undergoing physiotherapy for an injury, and had poor prospects for re-employment. In addition to Bardal factors, there are a couple of other factors that might be considered in determining reasonable notice period.  if an employer lures an employee away from a secure position, the Courts tend to find the reasonable notice period to be longer  pregnancy is also one of the factors to be considered, since it probably will affect an employee’s ability to find a new job. That’s how in Ivens v. Automodular Assemblies Inc, the Court awarded a 27-y.o. pregnant employee, who had 2 months service with the employer as an assembler, with 8 weeks’ pay in lieu. What’s Better For An Employer: Working Notice Or Pay In Lieu Of Notice? During a working notice, an employer should provide the terminated employee with sufficient opportunity to look for a new job.  In Kelly v. Monenco Consultants Ltd., the employer gave the employee working notice while he was on assignment in Nigeria. The court found that the notice was illusory because he had no practical opportunity to look for a job until he completed his Nigerian assignment. It maybe inappropriate to ask an employee to work through the notice period, if the employee is terminated on the basis of performance problems.  Elg v. Stirling Doors(2002) – a 54 –y.o. manual laborer after 14 years of service, was terminated because the employer felt that her attitude was causing a decreased morale in the workplace. He gave her an 8 weeks’ working notice. Upon being notified of termination, Elg did little work and used every opportunity to slow production down. In addition she verbally abused the employer. After a few days of such work, the employer fired Elg for “just cause” of willful misconduct. DECISION: The Court held that the employer lacked “just cause” for immediate dismissal. Elg’s conduct was a predictable consequence of the employer’s decision to provide termination notice, rather than pay in lieu. Additionally, the Court found that 8 weeks’ notice wasn’t enough to satisfy the employer’s common-law obligation. Elg was awarded 8 months’ notice instead. Chapter 11 – Managing Employee Performance and Conduct 1) Performance Appraisals even if a poorly performing employee remains on the job, the employer has laid the legal foundation for dismissing an employee with cause. The employer becomes in a stronger legal position when dismissing an employee on performance-related grounds.  should be conducted regularly and objectively based on the following principles: - be honest and balanced. Identify both strength and weaknesses. - Clearly communicate job standards to each employee. - Use a standard form to ensure that employees are evaluated consistently. - Allow the employees an opportunity to respond to an evaluation, both on the form and orally. - Document the evaluation - Provide employees with a copy of the evaluation and have them acknowledge in writing that they have received it. The acknowledgement should indicate that an employee’s signature does not mean that she agrees with the contents of the appraisal, simply that she has read it. 2) Progressive Discipline – the idea that discipline for less serious infractions should be imposed in a series of increasing steps.  each of these steps must be documented. If misconduct continues despite these disciplinary actions, an employer may eventually be entitled t dismiss the employee for cause.  helps to avid condonation (occurs when an employer is aware of misconduct and takes no disciplinary action within a reasonable time.) Daley v. Depco International Inc. – shows the value of adopting a clear disciplinary procedures. FACTS: Daley was 58 y.o. and had worked for Depco for 13 years when he was fired on the basis of “cumulative just cause”. In the previous 28 month there had been 9 documented incidents of misconduct. Depco used a 5-step progressive discipline policy set out in the employee handbook: 1) counseling, 2) verbal warning, 3) written warning, 4)suspension, 5) termination The employer has document multiple occasions of serious misconduct with the counseling methods that were applied in every occasion. Daley sued for wrongful dismissal. ISSUE: whether the employer had just cause to terminate Daley on the basis of his cumulative misconduct DECISION: the Court found that Depco had just cause. The Court concluded that Daley’s performance fell below any reasonable standard of conduct that his employer was entitled to expect. “the series of acts cumulatively do amount to enough bricks to constitute to a just cause wall” 3) Suspensions Without Pay - might constitute constructive dismissal under the common law (even if it’s just for a few days) because the right to work in exchange for pay is considered as a fundamental part of the employment contract. In Carscallen v. FRI Corp., the court found that a week-long unpaid suspension of a marketing executive, along with several other disciplinary measures, amounted to constructive dismissal. In Haldane v. Shelbar Enterprises Inc., that Court stated that the right to suspend an employee may be an implied term of an employment agreement, but the onus is on the employer to prove that this implied term applies in the circumstances.  if practiced as a disciplinary step, suspension without pay should be included in the employment contract.  Lengthy Suspension Without Pay constitutes Constructive Dismissal Reininger v. Unique Personnel Canada Inc. (2002) FACTS: Reininger was a long-haul driver who had been employed for more than 12 years with an above average performance record, when he was charged with impaired driving while operating his own car. His license was immediately suspended for 90 days. The employer suspended him without pay for 10 months before the trial has even reached its verdict. Reininger sued for damages in lieu of notice. ISSUE: whether the suspension until trial constituted constructive dismissal DECISION: the suspension constituted constructive dismissal. The loss of drivers license affected Reininger’s ability to perform the job, so the employer had an implied contractual right to suspend him. The length of the suspension however was unreasonably long, less drastic measures could’ve been taken. 4) Probation – in the absence of a contractual provision authorizing this action, the imposition of probation may constitute a fundamental change to the employment contract and give the employee the right to sue for damages for constructive dismissal. 5) Temporary Layoffs – has to be mentioned as one of the contractual terms, otherwise an employee might sue for constructive dismissal damages. (13 weeks or less under ESA) 6) Attendance Management (culpable –blameworthy act and innocent absenteeism – legitimate reasons) An employer may apply progressive discipline if culpable absenteeism occurs.  if employee’s absence is related to “disability”, he is entitled to accommodation from the employer, unless this constitutes an undue hardship. If an employee’s absen
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