At a certain point, the employment relationship can come to an end. There can be many reasons why the employment relationship ends, including layoffs or the employee moving on to another role. In some cases, however, the employer may choose to terminate an employee for cause, meaning there was a justified reason for ending their employment. Given the power dynamic in employment relationships, the employer often can decide whether to terminate an employee without much input from the employee. Therefore, there must be a valid reason before an employer can terminate an employee without providing reasonable notice or pay in lieu of notice to the employee. 

This post will discuss when an employer can dismiss an employee for cause and how their obligations relate to whether they were validly terminated. In particular, we will discuss the case Lagala v. Patene Building Supplies Ltd., 2024 ONSC 253, in which the court found that the employee was validly dismissed for cause after failing to report a workplace injury promptly. This post will provide important takeaways for employees seeking to understand their obligations after experiencing a workplace injury and employers who want to understand when they can dismiss an employee for cause in relation to an unreported workplace injury.

What are an employee’s obligations after a workplace injury?

After experiencing a workplace injury, an employee needs to be aware of and follow company policies concerning reporting it. These terms may be set out in the employment contract or, more commonly, in policies provided to the employees when they begin working. Often, this involves reporting the incident to a supervisor or health and safety representative at the company and filling out any required forms in the company policy.

Afterward, an employee may need to submit a workplace safety and insurance claim with the Workplace Safety and Insurance Board (WSIB). The claim is typically only submitted if the injury resulted in the employee needing treatment from a health professional, if the employee was unable to return to work, or if the injury affected the employee’s pay or hours.

An employee has 6 months from when the injury or diagnosis occurred to claim benefits after reporting to the WSIB. The injury should also be reported even if an employer tells an employee not to report it, even if they suggest an employee will lose their job. Even if an employer suggests that the injury does not cover the WSIB, the WSIB recommends reporting it. Also, even if an employer tells an employee to use their sick days to cover the injury, the employee should still report the incident to the WSIB. Employers can face fines and other penalties if they discourage an employee from reporting a workplace injury to the WSIB.

Employees need to report to their employer immediately if they experience an injury or illness in the workplace. The employer has three days to report the injury to the WSIB.

When can an employer dismiss an employee for cause?

Generally, an employer can justify dismissing an employee if the employee engages in dishonest conduct, although not all conduct will justify a termination. An employee could be dismissed for cause if:

  1. The employee is guilty of serious misconduct; 
  2. The employee has habitually neglected their duties; 
  3. The employee is incompetent; 
  4. The employee’s conduct is incompatible with their duties or prejudicial to the employer’s business; 
  5. The employee is guilty of wilful disobedience to the employer’s orders.

There is a three-step test for determining whether an employer dismissed an employee for cause. The court will consider each of the following:

  1. The nature and extent of the misconduct;
  2. The surrounding circumstances;
  3. Determining whether dismissal is warranted (i.e. if the dismissal is a proportional response to the misconduct).

In particular, the court noted in a recent case that failing to report a workplace injury can lead to a valid termination for cause, as it puts the employer at risk of non-compliance with their reporting obligations to the WSIB.

Employee’s Failure to Notify Employer of Work Injury Leads To Just Cause Dismissal 

In the Lagala case, the employee had worked for the employer for 13 years as the company’s Health, Safety, and Training Manager. She was terminated for cause in December 2019 and was 53 at the time of termination.

In March 2019, the employee had fallen in a parking lot at one of the employer’s facilities. After the fall, she did not report the incident to any of her supervisors until October 2019. After the incident, she started a claim with the WSIB, including completing the employer’s claim form. She also received a decision that granted her physiotherapy benefits. Later, the WSIB required her supervisor to sign the employer’s claim form in October 2019. About a month prior, she had included the accident in the company’s monthly report on health and safety incidents.

The company president then launched an investigation into the accident. As a result, the employer determined that they had lost trust in the employee, and she was terminated for cause in December 2019. 

The employee then pursued a claim for wrongful dismissal. 

The employee’s responsibilities in this role included ensuring that health and safety policies complied with regulations and were up to date. She also ensured that the company’s accident and incident reporting processes were effective.

Concerning the accident, she claimed that she did not feel any pain at the time of the fall, although she had landed on her left hip and lower back area and broke her fall with her left hand. She claimed that she was too embarrassed to report the incident as she was the health and safety manager for the company. Later on, in May 2019, she claimed that there was pain that was getting worse in her lower back. 

Overall, there was only evidence that the employee reported the incident to the employer many months later. The court also found that this was not a one-off lapse in judgment, as the employee had continued to hide her failure to report the incident, even asking her subordinate to cover her mistake. She also was found to have failed to protect the employer’s interests by putting them at risk of breaching the Workplace Safety and Insurance Act. In particular, her misconduct prevented the employer from fulfilling their obligations to report the incident to the WSIB within three days. As the health and safety manager, she should know the policies and what to follow. Therefore, the employer had cause to terminate the employee, as she was shown to be unable to carry out her employment duties. 

Contact Haynes Law Firm in Toronto for Advice on Termination and Wrongful Dismissal Claims

Employers and employees should carefully consider the termination clauses set out in the employment contract and any factors that may be relevant to terminations. Our experienced employment law legal team at Haynes Law Firm in Toronto can assist you with issues that arise from termination. Our goal is to ensure that employees understand their rights and receive maximum compensation in wrongful dismissal cases. Haynes Law Firm also assists employers in avoiding liabilities that may arise from terminations not permitted by the legislation. We are dedicated to finding the best resolution for you.

To book a consultation, please contact us online or by phone at 416-593-2731.