Character of Employment – Key Factor in Determining Whether Cause Exists

Menagh v. Hamilton (City) – Ontario Court of Appeal – April 5, 2007

In determining whether cause exists when terminating an employee, the contextual approach requires an examination of the employee’s character of employment.

The Ontario Court of Appeal’s decision on April 5, 2007 in Menagh v. Hamilton (City) [2007] O.J. No. 1310 (“Menagh“) demonstrates that a key factor in the contextual approach in determining whether misconduct committed by an employee is worthy of termination for cause is the character of employment. This approach must be applied when determining whether or not dismissal without notice is appropriate in any given situation.

In Menagh, the employee worked for the City of Hamilton and was responsible for the City’s labour relations. However, in 2005 the City dismissed the employee without notice after the employee personally and sexually harassed a co-worker. In response, the employee sued the City for wrongful dismissal. The Trial Judge dismissed this action stating that there was overwhelming evidence that the employee engaged in this misconduct.

On appeal to the Ontario Court of Appeal, the Court determined that the Trial Judge had not erred in finding that the City was justified in terminating the employee without notice. In making this decision, the Court considered whether the employee committed misconduct consisting of harassment and whether the degree of the misconduct warranted the employee’s dismissal without notice.

The Court found that “The Trial Judge did not err in finding that on the totality of the evidence, the City had established misconduct consisting of harassment, harassment in the workplace and sexual harassment in the workplace in violation of the City’s harassment policies.” The employee had “persisted in trying to be in a romantic relationship with [his co-worker] after she repeatedly told him that she was no longer interested.” In doing so, the employee communicated with the co-worker’s superiors, colleagues, family members and the co-worker herself. Also, the employee went to the co-worker’s home, watched her at work and made a point of parking his car next to hers.

Additionally, the Court established that the degree of the employee’s misconduct permitted his dismissal without notice. Citing the legal principle found in the Supreme Court of Canada’s decision of McKinley v. BC Tel [2001] 2 S.C.R. 161, “…courts must employ a contextual approach to determine whether just cause exists for termination.” The Court found that “the character of the [employee’s] employment is a key factor” in determining whether his dismissal without notice was permissible. The Court stated, “The [employee] was responsible for labour relations for the City of Hamilton. As such, he was in a senior position that required him to be familiar with all workplace policies (including policies relating to harassment). His misconduct is therefore more serious in light of his particular employment responsibilities.” Due to the character of the employee’s employment, the Court found that the City was justified in dismissing the employee without notice.

The decision in Menagh seems to suggest that some employees can be dismissed without notice for certain misconduct, while others in the same context cannot be due to their differing characters of employment. Instead, these latter employees would be either punished less severely, such as through suspension or warnings, or dismissed with appropriate notice; otherwise the employer may be found to have wrongfully dismissed the employee.

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