In her previous blog, “The Expanding World of Job-Protected Leaves: What’s Next?”, Mary Lou Brady wrote about the upcoming changes to Ontario’s Employment Standards Act, 2000, if Bill 21 is passed. In this blog, Mary Lou provides tips for employers who are considering terminating employment of an individual on a job-protected leave, or who is about to go off on, or who has just returned from, such leave.I recently blogged about the Expanding World of Job-Protected Leaves. In short, over the course of the last 12 years, new job-protected leaves have been added to the Employment Standards Act, 2000 (the “ESA”) at an ever-increasing pace.
Employers sometimes call me expressing concern about such leaves. Business conditions have changed. Performance concerns have arisen. Employers need flexibility to make legitimate business decisions, which might mean terminating employment of an individual on a job-protected leave, or who is about to go off, or who has just returned from, such leave.
At the heart of the concern is the question:
Here is what I generally tell my employer clients:
- Being on a job-protected leave does not give employees unlimited job security. Employees cannot be treated worse because of such leave. Employees are also not entitled to be treated better.
- Consider the “but-for” test. Can you truthfully answer yes to the question: “But for the job-protected leave, would the employee’s employment have been terminated?” If you cannot, then the termination is likely unlawful.
- Consider the “taint theory”. I explain it to clients like this: You buy a gallon of white paint from the local hardware store. If even one drop of black paint is added to the gallon of white paint, it’s no longer white. It is tainted. Similarly, you may have many legitimate reasons for terminating an employee’s employment. If even one smallest part of those reasons has anything whatsoever to do so with an unlawful reason – such as the employee’s absence (past, present or future) on a job-protected leave – then the entire decision to terminate is tainted. It is unlawful.
- Sometimes it is clear that the termination reasons are related to the leave. Other times, it is not so clear. Pay careful attention to situations that, on their face, appear lawful – yet only come to your attention because of the leave. For example, the replacement employee identifies that the employee now on leave was not properly performing her work duties before the leave and, because of this information, you want to terminate for poor performance. Or you identify, because of how the employee’s work duties were handled during her leave, that you want to eliminate the employee’s position as it is not needed and, as a result, terminate her employment.
- Consider the best time to make the termination effective. Is it before the job-protected leave starts? While the employee is on the leave? Or after the employee returns to work? My preference, whenever reasonable, is to delay the termination until the end of the leave. This allows the employee the full benefit of the leave, including any associated benefits (e.g. group benefits coverage; employment insurance benefits). Such approach is generally most acceptable to employers: (a) when terminating employment on a without cause basis; and/or (b) when they will incur little cost to continue employment until the end of the leave.
- Consider the best time to notify the employee of the termination. No one wants to ruin an employee’s time off work on a job-protected leave. At the same time, surprising an employee on her first day back with an immediate termination seems unkind. My preference, again whenever reasonable, is to notify the employee of the pending termination while she is still on leave. This is especially so when the employee may hear about the termination from other sources (e.g. in the case of a downsizing or restructuring). Such approach allows the employee to plan for the termination (e.g. starting the employment search; different childcare arrangements; etc.) and may ultimately decrease termination costs.
- Communicate the termination decision in a manner that reduces potential liability. My preference is to be upfront in the termination letter. Briefly explain the reason for the termination decision. Consider including “While we recognize that the timing of the termination is not ideal and may cause you concern, we wish to assure you that the termination decision has been made for legitimate and lawful business reasons, wholly unrelated to your leave and/or the reasons for that leave.” or words to this effect.
- Recognize that terminating an employee on a job-protected leave can be expensive. Employees are more likely to challenge terminations that occur when an employee is on a job-protected leave, or after the employee has announced an intention to take, or has recently returned from, such leave. Broad remedies exist when such terminations decisions are found to be unlawful (e.g. reinstatement with back pay; general damages for pain and suffering; etc.). Even when lawful, termination costs can still be higher if the timing of the termination impacts on the employee’s ability to find comparable replacement employment (e.g. an employee terminated when 7 months’ pregnant). Of course, this also often translates to more time and more legal fees being incurred by the employer.
- Be prepared for a potential challenge of the termination decision. Gather together any records you have to prove that the employee’s employment was terminated for lawful reasons, wholly unrelated to the job-protected leave. As always: Document! Document! Document!
Ultimately, as the employer, it is not a matter of whether you can or cannot terminate an employee. It is really about whether you can lawfully do so and, when it comes to job-protected leaves, understanding the increased risks that you may face and taking appropriate steps to reduce those risks.
Of course, each situation is unique and all relevant factors should be carefully considered. Terminating an employee on a job-protected leave is one situation where we strongly recommend that you consult, in advance, with employment counsel.
We are, as always, pleased to assist.