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  • Writer's pictureLee McMillan

What is Termination Without Cause?

Updated: Oct 16, 2023

What is Termination Without Cause?

The term ‘Termination Without Cause’ captures nearly any termination where an employee is dismissed for any reason outside of highly reprehensible conduct. For the purposes of understanding your rights you should not confuse the word ‘cause’ with ‘reason’. The vast majority of employees that are terminated in any given month are terminated on a ‘without cause’ basis. Shortage of work, employer restructuring and poor market conditions may be proper reasons for termination, but they are not ‘cause’ to terminate you without first providing you with reasonable notice or payment in lieu of reasonable notice.

In most cases reasonable notice means three to five weeks of notice, or payment in lieu of notice, per year you worked for the company.

Why is 'Termination Without Cause' Important to Understand?

Because >90% of companies will attempt to offer you payment in lieu of notice that is lower, and often times far lower, than what you in fact owed under the common law. Described as a ‘severance package’ the offer is frequently in the form of a second letter, separate from your termination letter. This letter is often worded in such a manner as to give the illusion that what they are offering is voluntary and gratuitous, or somehow stems from the goodness of their heart. This is in fact nearly never the case.

To make matters worse, most employees are under the false assumption that the amount of notice presented in the Alberta Employment Standards Code (the “Code”) is the amount of notice they are entitled to under law. This is false. The amount of statutory notice provided for in the Code is not a guideline for what you are owed and should be viewed rather as a basement number or bare minimum below which the law deems it unconscionable for an employer to go. By analogy, just because Alberta legislation provides for a minimum wage does not mean that is in fact what you are owed.

Unfortunately, most employees who type ‘Termination Pay’ into Google are immediately sent to the Government of Alberta website, which makes little to no mention of your right to common law reasonable notice. Government of Alberta staff are in fact precluded from discussing common law reasonable notice as are not trained lawyers. Employers are aware of this and will reference your rights under the Alberta Employment Standards Code in a manner that implies that the Code is the be all and end all of what they are required to pay.

What If My Employer Had a Good Reason to Terminate Me?

Many employees that are terminated may feel that because the economy is down, or times have been tough at the office, that it was reasonable for them to have been fired. This may very well be the case, especially with current complications relating to Covid-19, low oil prices and the general economic downturn.

Notwithstanding, a ‘reason’ to terminate is not synonymous with a ‘cause’ to terminate without notice or payment in lieu of notice. Poor economic conditions are a burden that must befall either the employee or the employer, and the common law places this burden primarily on the shoulders of the employer. Rather than being a ‘reason’ to terminate you without notice, poor economic conditions are often an indicator that you should be provided with more notice, as it will be that much more difficult to find alternative employment.

So Then What is Proper 'Cause for Termination'?

As stated above, ‘Termination With Cause’ is reserved for the most egregious behaviour relating to very serious employee misconduct. Examples of such misconduct can include:

· Theft

· Assault

· Harassment

· Chronic Absenteeism

· Willful Misconduct

· Disobedience

· Fraud

Even if an employee has engaged in forms of misconduct it is very difficult for an employer to prove that ‘With Cause Termination’ was justified unless they have first provided you with a series of written warnings, reprimands, performance reviews etc. The large majority of employees who are terminated are therefore terminated on a ‘Without Cause’ basis and are likely owed reasonable notice.

Why Contact a Lawyer?

A little bit of knowledge can be a dangerous thing. You would not presume to know which prescription drug to take to cure an ailment. Do not make the same mistake with your rights as a terminated employee. Employment law is a complicated area and it is worth contacting a professional to review your severance package for a reasonable fee.

Calgary Litigation lawyers review hundreds of severance packages per year. We can comfortably confirm that >90% of employers attempt to undersell their former employees with respect to severance packages. We will tell you if we feel it is in your best interest to challenge a severance package and will never recommend a course of action that we feel will leave you worse off financially.

Lee McMillan is the founder and managing lawyer of Calgary Litigation, He specializes in civil litigation, employment law and class action law. Contact Lee today for an affordable one hour phone consultation.

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