Ontario Court of Appeal’s recent decision in Hucsko v. A.O. Smith Enterprises Limited, 2021 ONCA 728 (“Hucsko”) demonstrates the high standard employers must meet in order to establish just cause. In reaching its decision in favour of the employer, the Court emphasized the seriousness of sexual harassment. The Court also considered factors such as the employer’s Workplace Harassment Policy, the employee’s seniority, and his adamant refusal to acknowledge wrongdoing. Under the rare circumstances of Hucsko, the employer successfully met the high threshold of just cause.
In Hucsko, a 61-year-old Senior Product Designer with a 20-year tenure was terminated for just cause. The employer alleged that the employee had made inappropriate and vexatious comments to a co-worker with respect to a formal complaint that was made to Human Resources. The employer also alleged that the employee failed to show remorse and engaged in wilful insubordination as the employee refused to comply with the corrective actions taken by his employer.
The employer had conducted a workplace investigation. The employee attempted to explain that his comments were pop-culture references and not sexual in nature. However, the employer concluded that the comments were inappropriate and required the employee to receive training on workplace sexual harassment and apologize to the complainant. The employee retained counsel who advised that the employee was open to training but would not apologize admitting wrongdoing. The employee was terminated for cause.
The trial judge found there had not been an “irreparable breakdown in the employment relationship.” The trial judge concluded that the employee’s refusal to apologize did not amount to a breakdown in the employment relationship. The trial judge found that the employee’s unwillingness to apologize did not amount to insubordination and noted that the employer did not bother to respond to the employee’s lawyer.
Court of Appeal Found that Sexualized Comments Justified Termination
The Court of Appeal disagreed with the trial judge’s decision.
The Court found that the trial judge incorrectly applied the test for just cause set out in Dowling v. Ontario (Workplace Safety and Insurance Board), 2004, 246 DLR (4th) 65. The Dowling test has 3 steps:
1) Determining the nature and extent of the misconduct;
2) Considering the surrounding circumstances, including the employee’s age, employment history, seniority, role and responsibilities, and workplace policies, etc.; and
3) Determining whether misconduct is sufficiently serious that it would give rise to a breakdown in the employment relationship.
Firstly, the Court found that the trial judge erred by construing the employee’s refusal to apologize as the sole basis of his termination. The cause for the employee’s termination was sexual harassment. The opportunity to apologize was offered to the employee as an opportunity to redeem himself and to avoid termination.
As to the circumstances surrounding the termination, the trial judge considered the employee’s long tenure but failed to consider the employee’s senior position and the degree of trust the employer had placed in him. Furthermore, the employee had recently undergone training on the Workplace Harassment Policy and was told repeatedly by both the complainant and his supervisor that the comments were unwelcome and inappropriate.
Further, the Court of Appeal found that the trial judge failed to recognize the seriousness of the employee’s conduct. Quoting the Supreme Court of Canada in its decision Janzen v Platy Entreprises Ltd., the Court of Appeal acknowledged that “sexual harassment is not confined to actions but includes comments with a sexual innuendo” and stated there was no doubt the employee’s comments constituted sexual harassment.
In his testimony, the employee demonstrated an understanding that sexual harassment is “fireable” misconduct according to the Workplace Harassment Policy. He also agreed that sexual harassment warrants an apology. However, the employee refused to recognize that his conduct amounted to sexual harassment and therefore believed an apology was inappropriate in this case.
The Court of Appeal concluded that based on these facts, the only conclusion the employer could reach was that there was a complete breakdown in the employment relationship. Before terminating the employee for sexual harassment, the employer gave the employee an opportunity to redeem himself, which the employee adamantly refused. Given the employee’s behavior and attitude, the employer could not have confidence that he would not continue with the same type of misconduct in the future. Therefore, the Court held the employer was justified in exercising their right to fire the employee for cause.
Termination for cause is the capital punishment of employment law. Termination for cause disentitles employees from receiving notice of termination or severance pay and may impact their ability to obtain future employment.
For employees, timely legal advice is very important, particularly when you are the subject of an investigation. Employment lawyers can protect your rights throughout the investigation process, advise you on how to keep your job, and in case of termination, help you understand your options.
For employers, employment lawyers should be consulted to ensure workplace investigations are done properly. The threshold for just cause termination is very high and the circumstances of each case play a significant role in its outcome. Therefore, it is important for employers to seek legal advice on how to conduct appropriate and thorough investigations to avoid costly disputes.
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