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Dentist Associate Agreements Part 2

By May 20, 2011July 2nd, 2021Employment Law

This is a follow-up to my recent introductory blog about dentist’s associate agreements.  In this blog, I’ll be discussing some additional terms and conditions you may or may not see in a dental contract – such as probation and termination.

Probation

Probation is a short-term trial period during which a dentist can assess an associate’s suitability for a position. Probation is not automatic. An Associate Agreement should clearly state that the first few weeks or months (typically up to 3 months) are probationary. This gives the dentist the chance to assess the Associate’s skills, attitude, performance and other employment-related characteristics with minimal or relaxed obligations to continue engaging the Associate.

Now, 3 months is a magical number because if the Associate is an employee, the Employment Standards Act, 2000 states that no MINIMUM NOTICE is required for employees with less than 3 months of service: section 54. As such, during this probationary period, the dentist employer can terminate the associate employee without the requirement to give notice or payment in lieu of notice. If the probationary period is longer than 3 months, the agreement should state that the dentist employer will provide the associate employee with the minimum notice of termination under the Employment Standards Act, 2000 if the associate employee is terminated after 3 months but before the end of the probationary period.

Now that takes care of statutory obligations, but what about the common law (i.e. judge-made law)? There may still be requirements to give reasonable notice or payment in lieu thereof if the associate employee was not terminated for Just Cause. In Segreti v. Orion Communications Inc., 2003 CarswellOnt 1785, the Ontario Small Claims Court reiterated the law when it comes to probationary employees as follows:

21 The rights and obligations of a probationary employee and an employer were considered by Madam Justice Epstein in Mison v. Bank of Nova Scotia, [1994] O.J. No. 2068 (Ont. Gen. Div.), where, considering the “more tenuous employment relationship” in such cases, she cited the requirements set forth in Kirby v. Motor Coach Industries Ltd. (1980), 6 Man. R. (2d) 395 (Man. Co. Ct.) [reversed (1981), 10 Man. R. (2d) 36 (Man. C.A.)]:

  • 1. The onus is upon an employer to show that it has “just cause” to discharge even a probationary employee;
  • 2. “Just cause” may be that the employee is, in the opinion of the employer, unsuitable for a job;
  • 3. The unsuitability which would justify the termination of a probationary employee may go beyond those grounds which might support the discharge of a regular employee and may include such considerations as character, compatibility, as well as ability to meet present and future production standards expected by the employer….
  • 4. Where a probationer has been terminated for unsuitability, the employer’s judgment and discretion in the matter cannot be questioned,….
  • 5. All of the foregoing is subject to the requirement of the employer showing that the discharge was in the bona fide exercise of the employer’s discretion and judgment that the employee was not suitable and not for some other reason or improper motive which would not justify a dismissal. [pp. 404-405]

Although a dentist employer may terminate an associate employee within 3 months without being required to give STATUTORY notice or payment in lieu thereof, the dentist employer can ONLY terminate the associate employee for “Just Cause” at common law in order to avoid giving reasonable notice or payment in lieu thereof at COMMON LAW. So what constitutes “Just Cause”? Well, in Mison v. Bank of Nova Scotia, [1994] O.J. No. 2068 (O.C.J. – Gen. Div.), Posner v. Seymour Epstein Enterprises Inc., [1996] O.J. No. 5076 (O.C.J. – Gen. Div.), and Ivens v. Automodular Assemblies Inc., [2000] O.J. No. 2579 (Ont. S.C.J.), the Ontario Courts held that “just cause” can be based on a decision that the Employee is unsuitable for the job. In coming to that decision, however, the employee must be given a real opportunity to perform the work; must be measured by reasonable, fair and known criteria; must be treated fairly; provided with a fair appraisal; and must be assessed by similar standards, as set by management for other employees in that position. The Employer must show that they acted fairly and with reasonable diligence in determining whether or not the proposed Employee is suitable for the job. The Employer cannot be held liable if his assessment of the Employee’s suitability for the job is based on such criteria and a fair and reasonable determination of the question.

Termination

Many associate agreements leave out the all-important matter of how to end the relationship.  This can be done in a number of ways.  First, the parties can come to some type of agreement (outside the associate agreement itself) about terminating the agreement.  Second, the parties can provide each other with a set period of time (notice) in order to terminate the agreement.  Third, one party (typically the dentist) will be able to unilaterally terminate the relationship in certain circumstances (e.g. during probation or as a result of ‘just cause’).  Now, “just cause” basically refers to the idea the dentist has some sound reasons for being able to immediately terminate the associate without the requirement to give notice or payment in lieu of notice.

What could constitute just cause?  Well, typical examples include lying, stealing, vandalizing the office, no longer being qualified to practise dentistry in Ontario, being insubordinate to the dentist or the dentist’s staff or patients, breaching the associate agreement, etc.  You can specify in the contract itself what you think should constitute just cause. You can also depend on common law (assuming that the associate is an employee) to terminate an employee for just cause.  There are lots of cases where courts have had to think about and make determinations over what kinds of conduct, acts, omissions constitute just cause in wrongful dismissal cases.

 

DMC