• When to dismiss


• Downsizing


• Documentation


• Notice Required


• How to tell the employee


• Recommendation Letters

The clearest case for dismissing an employee is when the worker has acted in a way which could have a serious impact on the company. Cause for dismissal includes fraud, theft, substance abuse, insubordination, and refusal to obey reasonable orders (see Labour Standards).

Employees may also be dismissed for incompetence, if:

Employers are often reluctant to dismiss an employee over performance issues related to interpersonal problems. The question to ask yourself is whether the performance problem is getting in the way of the work being done and being done well.

A person with a negative attitude may be able to hold some jobs without much impact on the organization. If, on the other hand, the person works in a team and brings other people’s morale down or is negative with customers, the situation is unacceptable. Progressive discipline is necessary, with the goal being to improve the performance of the employee so that he or she can contribute productively to the business.

If there isn’t a clear-cut case of just cause for dismissal, but the employee is disrupting the operation, employers do have the option of releasing an employee with a reasonable severance payment. A lawyer should be consulted to establish an appropriate level of compensation, which might be two to four weeks severance pay for every year of service, with some maximum amount being considered appropriate. To be fair, the employer should go through the normal disciplinary steps to allow the worker a real chance to change his or her behaviour.

Note that employees cannot be dismissed:

Employers who come up with other reasons for dismissing an employee who has been involved in any situations related to these issues leave themselves open to some liability.

It is important for companies to ensure that performance problems and serious incidents are well documented. For disciplinary issues, employers need to keep file copies of the disciplinary letters given to the employee.

In the case of serious incidents which require prompt action, employers will need to have a record of statements by key players in the incident.

It is wise to consult a lawyer prior to a dismissal, even for a small business. In the case of a serious incident, you may wish to suspend the individual immediately while you determine the action you need to take.

Sample Disciplinary Letters

In the case of serious misconduct, and "just cause" for dismissal, notice or pay in lieu of notice aren’t required. See Labour Standards.

In the case of performance issues, where the disciplinary process is followed, pay in lieu of notice is normally appropriate. Note that Labour Standards require minimum notice, but that common law judgements may normally give dismissed employees higher severance packages, particularly in the case of workers with long service, at the management level, or where it is difficult to show evidence of the performance problems.

In these cases, it is wise to check with a lawyer for a recommendation of an appropriate compensation level.

Firing an employee for performance problems isn't easy. The dismissal shouldn't be a major surprise to the employee if you have followed the three disciplinary steps suggested (see Discipline). Nevertheless, it is stressful for both parties. Here are some recommendations:

If you do decide to release your employee, it maybe for other reasons than poor performance. It may be due to other issues like downsizing. In any case you should be prepared for your employee to ask you for a recommendation letter.

Should you write one, shouldn't you write one. If you decide to write one what should you put in it. How do you say no. If you are not sure how to answer these questions read up on recommendation letters.