The recent Ontario decision of Tagg Industries v. Rieder, 2018 O.N.S.C. 5727 emphasizes the strict requirements that employers must meet to terminate an employee for just cause.
Overview
After having worked for the employer for a year, the employee signed a new employment agreement and received a $40,000 loan from the employer, for which the employee signed a promissory note. The loan was to be forgiven on January 5, 2016, the day that the employee would have earned a $40,000 bonus.
The employee was terminated for just cause a month before he was to receive the bonus and the employer sued the employee for the amount of the loan. The employer gave a number of reasons for terminating the employee for just cause, including that he had stored pornography on the company laptop.
The employee countersued his employer for forgiveness of the loan and claimed he was wrongfully dismissed.
The Court found that the employer had failed to inform the employee that he was terminated for just cause. As a result, the Court dismissed the employer’s claim, found the employee was entitled to his bonus (offsetting the $40,000 loan) and awarded him $14,583.33 in damages for wrongful dismissal. With regard to the pornography on the company laptop, the Court found that the employee was only witnessed working on the laptop. There was no suggestion he looked at or downloaded pornography at work, created a hostile working environment, or that the pornographic material was illegal, as would be the case with child pornography.
The importance of the case
This case highlights the fact that employers must provide very clear reasons for dismissal to an employee if they are terminating the employee for just cause. It also emphasizes that finding pornography on an employee’s company laptop may not always result in automatic termination for just cause. This case does not grant employees the right to store pornography on company property. Doing so can still be just cause for termination, but it will depend on certain factors, including, but not limited to, if an employer has clear workplace policies and the context of the particular work environment.
If you have any questions regarding this article, please contact Robyn Jarvis.