Just Cause for Dismissal? Hard to Prove.

What kind of conduct is just cause for the dismissal of a teacher?  If the teacher has been a long serving employee, the threshold will be quite high, according to a recent Ontario Superior Court decision.

In the case of Fernandes v. Peel Educational & Tutorial Services Limted, the plaintiff was awarded one year’s salary.  Perhaps more significantly, he was awarded the value of disability benefits that he would have been eligible to receive because he became disabled within a short time period after being dismissed.

Mr. Fernandes had been a teacher with Peel Educational Tutorial Services for more than 10 years.  In 2009, the school alleged that Mr. Fernandes had falsified students’ marks and committed “academic fraud” by doing so.  Mr. Fernandes conceded that some of his calculations were incorrect and that there were some issues with his submitted marks.  But he denied his conduct was “fraudulent.”

This case involved a 10 day trial, which featured the evidence of numerous witnesses.  One of the witnesses called by the school was  a “Mr. Zero,” who certainly has an interesting name for a witness in which one of the allegations is that certain students should have been given a mark of “0” for failing to hand in assignments.

In any event, after all of this extensive evidence, Justice Lemon concluded that Mr. Fernandes had been wrongfully dismissed.

The court made some interesting findings including:

  • Mr. Fernandes gave incorrect marks;
  • The marks he gave were late;
  • He allowed students to have overdue assignments;
  • Even though he was a computer teacher, his own computer program did not provide accurate marks;
  • He lied to his employers about how the marks were calculated;
  • He lied to the court about the student presentations were marked;
  • He admitted to falsifying some marks on students’ records.

These are all findings made by the court and appear in the decision.

However, the court also noted that Mr. Fernandes had been employed for more than 10 years and up to these incidents, was considered a “well-regarded teacher.”

Taking into account all of the circumstances and relying heavily on a charitable reading of McKinley v. B.C. Tel (2001) S.C.C. 38, [2001] 2 S.C.R. 161, the court concluded that “immediate termination was not the appropriate sanction for this misconduct.”  The court noted that “the defendants could have fashioned a reprimand and a warning that such conduct, if repeated, would lead to summary dismissal.”   The court awarded Mr. Fernandes one year’s compensation amounting to just over $50,000.

Mr. Fernandes had also sued for $300,000 in “intentional infliction of mental distress.”  This claim was rejected.

However, in addition, he had brought a claim for “long-term disability benefits” for $226,000.  At trial, he demonstrated that he was suffering from severe depression and other related symptoms.  The court held that he became disabled after being dismissed and during the applicable notice period.  The employer was therefore responsible for the full value of the disability benefits.  Given that Mr. Fernandes was 52 at the time of dismissal, this could mean approximately 13 years of LTD benefits, for which the defendant school would be responsible.

It remains to be seen what the Ontario Court of Appeal will do with this case.  Given the findings of the judge, there seems to be significant findings of improper conduct that may well warrant a just cause dismissal.  Although the judge was in the best position to make these findings of fact, the Court of Appeal may well review the court’s conclusion that just cause dismissal was not warranted in the circumstances.  It should provide for some interesting reading if the case is actually appealed and argued.

Irrespective of what ultimately happens with this case on appeal, if it gets there, here are some key points to consider:

1.  Establishing just cause for long service employees is extremely difficult and costly.  Many judges are willing to give plaintiffs the benefit of the doubt, even where serious misconduct is alleged.  Even were there is evidence of some misconduct, courts will consider the whole employment history of a dismissed plaintiff;

2.  Dismissed employees can and should fight employer determinations of “just cause” if there is any reasonable prospect of success and sometimes, these cases can sometimes even be won where the prospects look grim;

3.  Dismissed employees are entitled to insurance benefits during any applicable notice period.  If they are cut off from these benefits by their employer and then later found to have been wrongfully dismissed, employers will be responsible for the full value of the benefits.  This means that if an employee dies during a notice period, the employer will be responsible for the full value of the life insurance policy that had been in effect.  If the employee becomes disabled, the employer will be responsible for the full value of the disability benefits.  Employers need to consider liability very carefully before cutting of an employee from all benefits when making a termination decision.




Out of the Blue by Jan Wong: A Review – by an Employment Lawyer…

I picked up Jan Wong’s latest book Out of the Blue out of professional interest.  As an employment lawyer, I had heard that the book was an interesting assessment of Ms Wong’s fight with the Globe and Mail, her former employer.

Although the dispute with The Globe and Mail plays a significant role, this memoir style offering is much more concerned with Ms Wong’s battle with depression and her struggle to overcome it.

It is a very intimate, personal look at a person struggling to deal with mental illness.  Ms Wong spends of great deal of time dealing with the effect that her depression had on her relationship with her family members, her interactions with family and friends and her own very personal ways of trying to overcome these challenges.

Early in the book, Ms Wong describes the events that she believes triggered her depression.  A well known, accomplished columnist for many years, she wrote a column analyzing the Dawson College shooting in Montreal, Quebec in September 2006.  The column drew a connection between the fact that the only three campus shootings in Canada had been committed by immigrants in Quebec and that the three killers had been marginalized by a society that values pure laine Quebec stock.

As if to partially substantiate her claims, Ms Wong was flooded with angry hate mail, much of it in French. She received mail that attacked her ethnicity, her gender, and her appearance.   She was subjected to outrageous, vulgar email attacks and, ultimately, a death threat.  She was also attacked by mainstream media, including major Quebec newspapers.  The Globe and Mail itself printed numerous articles responding harshly to Ms Wong’s column and there was even a call in the Canadian Parliament for her to “apologize” to the people of Quebec.  Things became worse as caricatures of her were drawn in Quebec newspapers, her father’s restaurant was boycotted and the Globe and Mail eventually printed a column indicating that Ms Wong had erred.

Frustration of Contract: Disabled Employee Loses Wrongful Dismissal Case

If an employee becomes totally disabled and cannot return to work, the employer may be able to end the employment relationship without any further obligations.  This doctrine of “frustration” was recently analyzed in the case of Fraser v. UBS Global Asset Management, a decision of the Ontario Superior Court of Justice.

Linda Fraser had worked for UBS for more than 20 years.  She became ill after a holiday and was off work for six months on short term disability leave.  She tried to return to work but was unable to do so due to her illness, which had become more severe.  She went off again on short term disability leave for another six months.  After her second leave, Ms Fraser was off for a two year period on long term disability leave.

Most LTD policies change after two years.  For the first two years, Ms Fraser was required to show that she could not perform the duties of her employment, meaning the specific job that she had with UBS.  After two years, she was required to show that she could not perform the duties of any gainful occupation.  The insurer cut Ms Fraser off benefits when the definition changed and Ms Fraser sued the insurer to challenge that decision.  The lawsuit was totally separate from her wrongful dismissal case.

From UBS’ perspective, Ms Fraser’s disability coverage ended even though she was suing the insurer.  She was off work and no longer in receipt of benefits for a period of five months.  She did not keep UBS informed about her status.  After five months, UBS wrote to Ms Fraser and stated that her employment was being terminated.  It paid her out 8 weeks’ notice pay and 22 weeks’ severance pay under the Ontario Employment Standards Act and continued her extended health benefits for three more months.  Ms Fraser did not accept this decision and sued for wrongful dismissal.

Are Dismissed Employees Entitled to LTD Benefits?

Should a dismissed employee be entitled to LTD and STD benefits even after the date of dismissal?  That is the topic of this article.

Luis Romero Olgin worked for Canac Kitchens as a cabinet maker and production supervisor for 24 years.  He was dismissed in 2003 at which time he was 55 years old.  His termination was “without cause.”  However, Mr. Olgin was not provided with common law severance at the time of dismissal, as required by Ontario law.  Instead, he was paid only the bare minimum amounts under the Ontario Employment Standards Act, amounting to 32 weeks’ pay.  His benefits were continued for only 8 weeks rather than for a reasonable notice period.

Only two weeks later, Mr. Olgin was able to find new employment with Cartier Kitchens, but at a much lower rate of pay.  With Canac Kitchens, Mr. Olgin had been entitled to Short and Long Term Disability Benefits (STD and LTD).  However, he could not get these benefits through Cartier.

Approximately 15 months later, Mr. Olgin underwent cancer surgery and continued to require cancer treatment, including various types of surgery for a number of years.  By the time this case came to trial, Mr. Olgin was still undergoing cancer treatment.  He was still disabled.

Mr. Olgin sued Canac Kitchens for wrongful dismissal.  At trial he was awarded a reasonable notice period of 22 months.  This meant that he was entitled to everything he would have earned for a period of 22 months, less whatever he earned while working for Cartier.  More significantly, Mr. Olgin was entitled to STD and LTD benefits from Canac for the entire reasonable notice period.  Since he became disabled approximately 16 months after being dismissed by Canac, Canac was still responsible for Mr. Olgin’s LTD coverage.  Based on available medical evidence, Mr. Olgin was awarded damages by the Ontario Superior Court (the late Justice Randall Echlin) for disability benefits to the age of 65.  These damages amounted to close to $200,000.  Mr. Olgin was also awarded punitive damages of $15,000 and compensation for legal costs of $125,000.

Canac appealed the decision to the Ontario Court of Appeal, which released its decision on January 31, 2012.  The Ontario Court of Appeal upheld the full award of STD and LTD benefits for Mr. Olgin to the age of 65.  However, the Court of Appeal overturned the punitive damages award since Mr. Olgin had not originally sued for punitive damages.

This decision has tremendous ramifications for employees and employers.  The Ontario Court of Appeal has made it clear that employers must provide STD and LTD benefits during any period of reasonable notice.  If an employee is dismissed and does not sign a release with his or her former employer, the employee will be entitled to disability benefits if he or she becomes disabled during the reasonable notice period.  This would not apply if the employer provides a severance package and the employee signs off – even if benefits are not included in the signed off package.

Employees in Ontario can sue for disability benefits if they become disabled at any time during a reasonable notice period as long as they have not otherwise reached a settlement with their former employer.

For employers in Ontario, the decision means that employers can be held liable for disability benefits if they cancel an employee’s benefits at the time of dismissal or shortly afterwards without a release.  Employers can avoid this liability by paying employees reasonably at the time of dismissal and by getting a signed release.  Without a release, employers can be liable for the full amount of any disability benefits.

This case clearly demonstrates that employees must be very careful when reviewing and deciding on whether or not to sign a severance package and release.  They may be giving up significant potential compensation and should only do so if the severance package is otherwise reasonable.

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