To remind our readers, in certain circumstances, an employer has the right to dismiss an employee for cause based on serious acts of misconduct by the employee such as gross dishonesty or theft. There is a difference between dismissal for cause at common law and dismissal for cause under statute. However, generally speaking, termination for “just cause” means that the employer has dismissed the employee due to some form of misconduct that results in a complete breakdown of the employment relationship. In cases of termination for cause in Ontario, the employer will not provide the employee with notice of termination or pay in lieu of notice to termination at common law and, possibly, under Ontario’s Employment Standards Act, 2000.

However, there are sometimes situations where the employer does not immediately act to dismiss the employee after the employee has engaged in the impugned conduct. The employee may wait a period before the employer moves to dismiss the employee. How long can the employer wait until they dismiss the employee before the employee’s impugned conduct is seen to be waived by the employer? The answer to this question is the focus of this blog.

What is condonation?

Condonation is a legal concept in employment law. It occurs when an employer fails to terminate an employee for “just cause” within a reasonable amount of time after an act of misconduct was committed by the employee. The case law in Ontario sets out that condonation may be a defence that an employee may use when an employer attempts at a later time to terminate the employee for cause based on a previous act of misconduct. As such, the onus to prove condonation is on the employee.

The point of condonation is to prevent the employee from being deceived into a false sense of security that the employer has forgiven or has waived the act of misconduct and will not use it to terminate their employment.

What should an employer do in cases of misconduct?

It is common that employers can be lulled into a false sense that they may use acts of misconduct to terminate an employee’s employment at any time. As we can see from the above, this is not the case in employment law in Ontario. If an employer learns of an act of misconduct by their employee that warrants termination for cause the employer should: 1) terminate the employee immediately for cause or 2) terminate the employee for cause after a reasonable time to consider its position.  For instance, the employer may want to investigate the circumstances leading to the act of misconduct and, as such, may reasonably take some time to examine the situation to gain a full grasp of what happened and its effects on the workplace.  However, to avoid risks of claims of condonation, the employer should ensure that any delay in investigating the facts should be kept short and easily explainable. Obviously, the determination of this issue will be based on a contextual analysis of each individual case.

Employers also should be aware that if they are not confident in their decision to terminate for cause the employer has the ability and, oftentimes the legal requirement, to provide a warning to the employee as an alternative to termination. A warning given to an employee should set out that the employee’s misconduct is not acceptable and if the employee does not stop the behaviour, that it could then result in termination for cause or further discipline. Any warning given to the employee from the employer should be clear with respect to what the misconduct was and ensure that the prescribed discipline was adequately described.

What are common examples of condonation?

Here are several examples of common acts of condonation:

• providing an employee with a pay raise or wage increase after the incident of misconduct;
• providing an employee with a bonus after the incident of misconduct;
• providing an employee with a positive performance review after the incident of misconduct;
• providing an employee with a neutral performance review after the incident of misconduct;
• offering to provide a reference letter for the employee after the incident of misconduct;
• failing to discipline the employee after the incident of misconduct;
• disciplining the employee after an unreasonable period of time of the incident of misconduct;
• failing to provide a warning to the employee after the incident of misconduct;
• providing a warning to the employee after an unreasonable period of time after the incident of misconduct and relying on that warning; or
• providing the employee with any notice of termination.

How can Zeilikman Law help?

It is crucial that an employee or employer who has questions or concerns about the legal concept of condonation approach an employment lawyer for legal advice. An employment lawyer can help an employee ensure that the employee’s legal rights are protected upon termination so that the employee gets the compensation that they are owed. An employment lawyer can also help an employer navigate what to do in cases where there are accusations of misconduct in order to avoid claims of condonation by an employee and minimize their risks of litigation.

For more information about the legal concept of condonation, please take a look at our blog entitled Key Points for Employers about Condonation.

Zeilikman Law can be contacted at (905) 417-2227 or online here to schedule a confidential consultation with one of Zeilikman Law’s employment lawyers.