Canadian Employment Law Today

4 Canadian HR Reporter, a Thomson Reuters business 2014 Employment contract bars unjust dismissal complaint Termination clause speci ed Canada Labour Code minimums — which employer ful lled — and employee had no evidence of unjust dismissal factors By JUSTin TETREaULT L AST YeAR, the Federal Court had the opportunity to settle an ongo- ing debate about whether or not terminations without cause are permitted by the Canada Labour Code. is was an important question because of the unique statutory regime governing federally reg- ulated employers and the possible rem- edies — such as reinstatement — that are available to employees who have been un- justly dismissed. Put simply, if a without- cause termination is not considered to be "unjust," then those employees terminat- ed without cause would not be permitted to seek redress under the code. After reviewing the code in its 2013 judgment in Atomic Energy of Canada Ltd. v. Wilson, Justice James O'Reilly con- cluded, " ere is no basis for concluding that the CLC only permits dismissals for cause. at conclusion would fail to take account of the clear remedies provided in ss. 230 and 235 (notice and severance) for persons dismissed without cause." Instead, according to Justice O'Reilly, the code sets out the following regime for dismissals: • An employer can dismiss an employee without cause so long as it gives notice or severance pay, as required (ss. 230 and 235). • If the employee believes the terms of her dismissal were unjust, she can fi le an unjust dismissal complaint (s. 240). • In addition, the employee can complain if she believes the reason given by the employer for the dismissal was unjusti- fi ed or if the dismissal is otherwise un- just (such as based on discrimination or reprisal). • If the adjudicator concludes that the dismissal was unjust, she has broad re- medial powers (s. 242(4)). • e only exceptions to the general right to make a complaint is where the dis- missal resulted from a layoff for lack of work or a discontinuance of the employee's position, or the employee has some other statutory remedy (s. 242(3.1)). Sigloy v. DhL express After Wilson, there was some question about how the ruling would be applied by code adjudicators and what its repercus- sions would be. is year, in Sigloy and DHL Express (Canada) Ltd., Re, the fi rst reported de- cision to consider Wilson, the issue was whether an adjudicator had jurisdiction to hear a complaint of unjust dismissal where the employer did not allege just cause and the employee's notice and sev- erance entitlements were governed by an employment contract. Filo Sigloy was hired by DHL Express (Canada), Ltd. on or about Sept. 20, 2010, into a bargaining unit position. On May 1, 2012, he was promoted to a non-union position for which he signed an employ- ment contract containing the following termination clause: " is agreement and your employment hereunder may be terminated as follows: (a) You may terminate this agreement for any reason upon fourteen (14) days prior notice in writing to the Compa- ny. (b) By the company at any time without notice for Cause in which case your employment shall terminate imme- diately upon receipt of written notice setting out the Cause of termination. "Cause" shall include, but not be lim- ited to, a material breach of the terms of this Agreement. (c) e Company may terminate your em- ployment at any time giving you the greater of two (2) weeks' notice in writ- ing or the minimum notice and sever- ance required by the Canada Labour Code. No other notice or severance requirement, expressed or implied, shall apply. Upon termination of your employment you will return all DHL property, materials, reports, keys, cards, etc. that you have in your pos- session or control to DHL (emphasis added) ." On Oct. 9, 2012, DHL terminated Si- gloy without cause and provided him with two weeks' pay in lieu of notice and fi ve days severance, fulfi lling the minimum requirements of the code. Sigloy fi led an unjust dismissal complaint under the code. DHL raised a preliminary objection, arguing that the arbitrator was without jurisdiction to hear the complaint be- cause Sigloy was not unjustly dismissed. According to DHL, Sigloy's termination was not "unjust" because the code per- mits dismissals without cause; the dis- missal occurred pursuant to a valid and enforceable employment contract; the statutory requirements for termination pay and severance pay were met; and Si- gloy did not allege that the dismissal was discriminatory, the result of reprisal, or in bad faith. Relying on the analysis in Wilson, the SoMEtiMES it may feel to employers that it's very diffi cult to dismiss an employee, and this has some element of truth, The reality is that the bar is high if an employer alleges cause for dismissal, but if the dismissal is without cause, it's pretty simple as long as the employer meets its notice and severance obligations. Federally regulated employers are subject to a different employment standards regime than their provincially regulated counterparts, including some differences with regards to wrongful dismissal — called unjust dismissal in the Canada Labour Code. However, recent decisions have reinforced the fact that there's nothing standing in the way of dismissal without cause, as long as legal obligations are upheld. And, as was determined in one recent case, an employment contract with a specifi c and legal termination provision is just as valid for a federally regulated employer as any other. "The employee was feeling overwhelmed with his new duties, so he requested a pay raise for the additional functions and informed the company of his concerns regarding the level of work." caSe In PoInT: WRONGFUL DISMISSAL

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