You’re Fired! Performance Deficiencies: When Is Termination the Answer?

We’ve all been there – you hire an employee with great prospects and great credentials; however, once the work begins, the worker is just not performing up to the standard expected. He’s missing deadlines, turning in erroneous reports, and is affecting the team’s credibility.

The question then becomes: When is termination the answer?

There is a heavy onus placed on an employer that claims incompetence (or failure to meet the standard expected) as just cause for dismissal. In order to establish that an employee’s incompetence is cause for summary discharge, an employer must do more than prove that the employee was unsatisfactory, careless or indifferent. There must be actual incompetence, inability to carry out duties or substandard work that persists after warnings to improve.

Termination for performance issues should never be a surprise to an employee.

Where an employee is found to be incompetent, the employer may have just cause to dismiss the employee if the employer first takes appropriate steps to address it. This should include:

  • Establishing reasonable, objective standards of performance and communicating those standards to employees in a clear and understandable manner;
  • Providing proper training and support to managers and supervisors with respect to the standards of performance expected, and ensuring that performance reviews accurately reflect employee performance;
  • Measuring the standards of performance and promptly advising employees when they are not meeting expectations;
  • Providing employees with a clear and unequivocal warning that their employment is in jeopardy;
  • Allowing a reasonable opportunity for improvement before terminating the employee’s employment.

The overall goal should be to provide the employee with the necessary tools to improve performance.  Proper documentation and consistency among managers and supervisors will be important throughout the process.

What happens when the employer’s processes fail to live up to those standards?

An employer in British Columbia recently found out when a Supreme Court judge awarded $15,000 in aggravated damages for the bad faith manner of dismissal. In particular, the judge held that the employer had set unreasonable, unfair and ambiguous performance standards (to which the employee had not been held previously) and had failed to provide the employee with a meaningful opportunity to improve.

The judge also held that the employer’s ultimate assessment – that the employee had failed to meet the expectations – was based an assertion that she had a poor attitude, despite not advising the employee why her attitude was deficient or giving her a chance to respond to the allegations.

Cottrill v. Utopia Day Spas and Salons Ltd. (2017 BCSC 704 CanLII) makes it clear that it is in the best interest of employers to provide underperforming employees with proper and proactive performance management prior to a just cause dismissal for incompetence. Failure to do so significantly increases the risks associated with such a termination.

Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.