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EMPLOYEES MUST BE GIVEN AN OPPORTUNITY TO RESPOND TO ALLEGATIONS

A man we will call Tom worked for a golf club as its general manager for 12 years. He routinely received positive performance reviews from the Board of Directors as well as salary increases. 
 
One day, a member of the personnel committee of the Board of Directors learned that there was a former employee who had apparently left the golf club because of Tom’s behaviour as a manager.
 
The personnel committee met with that employee. The former employee said that Tom had once poked her in the shoulder, subjected her to a sexual comment, that staff were frequently reduced to tears by his volatile behaviour and that Tom had taken items from the wine cellar for his own use.
 
The personnel committee called a meeting with the full Board and the Board voted to terminate Tom. 
Despite having worked for them for 12 years, Tom was never given an opportunity to respond to these allegations. He was not even told what the allegations were. He was required to leave a staff retirement party going on at the club to meet with some members of the Board in a nearby office. They told him they had lost confidence in his ability to manage the club. They told him that he had 10 minutes to resign or they would fire him. Tom refused to quit and the employees at the retirement party watched as he was escorted out of the building.
 
When Tom sued for wrongful dismissal, the court found that there was not just cause for his termination and awarded him 15 months pay in lieu of reasonable notice.
 
The court also awarded Tom an additional 2 months pay in lieu of reasonable notice as a result of the bad faith treatment he suffered at the time of his termination. Instead of suspending Tom and properly investigating the allegations and at least giving Tom the chance to respond, the employer simply fired him after pressuring him to resign. The Board then sent out a letter to its members indicating that it had concerns with “former senior management”. Everyone knew that Tom had left the club and that they were talking about him. Tom’s chances of getting another position as a club manager were significantly affected by this behaviour. Tom was not offered any outplacement counselling to help him find new work. He was devastated by the indignity of having his staff watch as he was escorted off the premises.  All of these things led the court to increase the reasonable notice to which Tom would otherwise have been entitled.
 
The lessons for employers from this case is clear: (1) Avoid publicly humiliating terminated employees by escorting them off the premises when everyone else is around and (2) In almost all situations, you should give an employee a chance to explain themselves before terminating them for alleged misbehaviour. It is not only the right thing to do, it is the fiscally prudent thing to do. Not giving an employee a chance to respond to allegations can cost money.
 
As published in the Hamilton Spectator, October 19, 2004