I was advising a client this week on the termination of a 25-year executive. I recommended an offer of 20 months’ severance in the circumstances. But, the client argued, the employee had only been in her position for little more than a year, after being in much more junior positions for the previous 24.
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Although the termination related to “fit,” the client also argued that this executive had not been performing well and had even received a recent written warning. Surely, they pushed back, they had built up their case and could not possibly be on the hook for 20 months’ severance given her poor performance.
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Such a dialogue arises regularly in my practice and reflects several misapprehensions.
There is no such thing as “half cause.” Either an employee’s performance or conduct is so horrid, after warnings, that they are entirely irremediable so that the court will agree that there is cause for dismissal (and no entitlement to any severance) or the conduct does not reach that level of incompetence/misconduct.
Once upon a time, there was a doctrine of “near cause,” whereby the courts would award less severance to a poorly performing employee whose conduct was not quite egregious or desultory enough to be cause. But the Supreme Court of Canada eliminated near cause years ago, and as result, whether an employee is a spectacular performer or near but not quite disastrous one, the severance is the same.
Poor...
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