“Just Cause” Termination: Didn’t Work in Patridge v. Botony Dental Corp.

Dentist employers think that they can fire someone right away for wrongdoing.  Yes, they certainly can try.  But it’s not always so straightforward.  And if you get it wrong, you’ll be sued for wrongful termination and for failing to provide reasonable notice!

Case in point, let’s look at the recent Ontario Superior Court decision in Partridge v. Botony Dental Corp., [2015] O.J. No. 226.  Part of that case involved a corporation that owned and operated a dental practice terminating a hygienist/office manager for “Just Cause”.  Note: the corporation was owned by a hygienist, but which was not a professional corporation – which is another interesting matter to examine later on!  The employee sued for wrongful dismissal, claiming that there was NO JUST CAUSE to terminate her.

Just Cause Termination: The Law

Now…onto “Just Cause” Termination.  The idea here is that if an employee is doing something really bad, the employer can terminate them immediately and without providing them with any notice or payment in lieu of notice.  In other words, the employee has engaged in misconduct that is incompatible with the fundamental terms of the employment relationship.

“Just Cause” was defined in the Partridge case as follows at paragraph 23:

The usual definition of just cause is as follows: “…misconduct inconsistent with the fulfilment of the express or implied conditions of service will justify dismissal”. Although there is no airtight evidence of what constitutes cause for discharge, the definition relied on most is:

If an employee has been guilty of serious misconduct, habitual neglect of duty, incompetence, or conduct incompatible with his duties or prejudicial to the employer’s business, or if he has been guilty of wilful disobedience to the employer’s orders in a matter of substance, the law recognizes the employer’s right summarily to dismiss the delinquent employee.

Each case must be determined on its own to determine if the employee’s conduct justifies immediate dismissal.  And it’s the employer who has to prove this (the Court has to be at least 51% convinced) in order to be successful.  Failing to prove that the termination was for “cause” is a significant punishment to the employee, who would otherwise have received notice (either under the Employment Standards Act, 2000 or at common law or based on the provisions of a private agreement).  Finally, the alleged misconduct must be weighed against the employee’s historical performance such that it must OVERSHADOW years, loyalty and efforts devoted by the employee to the employer.   Finally, if the employer’s interests or reputation are seriously prejudiced by the employee’s conduct, or where the conduct reveals such an untrustworthy employee that the employer cannot continue to put them in a position of trust, then just cause termination may be warranted.

Examples of Just Cause Termination

Here are some examples of just cause termination:

• Theft or misappropriation of employer’s property/money (apparently, this happens quite a bit in dental offices that have assignment practices).
• Theft of confidential employer information (e.g. copying confidential business documents such as client lists) may be dismissed for cause).
• Making plans to compete with one’s employer and taking steps to do so while still employed.
• Insolence (insulting, abusive, threatening or unreasonably violent words) or insubordination (rebellion or refusal to follow a proper direction).

Sometimes, it’s not until an employee is terminated that their dishonest conduct is discovered.

3 Part Test

To determine if dismissal is justified, there’s a three-part test: (1) the nature and extent of the misconduct must be examined,  (2) the surrounding circumstances must be examined, and (3) a determination must be made as to whether dismissal is a proportional response.

Application in Patridge v. Botony Dental Corporation

After reviewing the jurisprudence concerning the law of just cause termination, the court examined a number of allegations made by Botony Dental Corporation to warrant their just-cause termination of Lee Partridge.  This included:

1. Partridge chose to reject her former position as an office manager on return from maternity leave, or that she demanded that the office hours be changed;
2. Partridge systematically harassed coworkers and management;
3. Partridge acted insolently or displayed insubordination;
4. Partridge solicited Botony’s employees to open a competing business;
5. Partridge copied confidential client records for the purpose of establishing a competing business;
6. Partridge solicited patients for that purpose;
7. That the removal by Partridge of one or two-day sheets constitutes just grounds for dismissal.

For each of these allegations, the Court was NOT satisfied with the evidence.  The Court mentioned from the onset that it believed Lee Partridge’s evidence and testimony more than everyone else’s.  The Court also noted that, at a dental practice, “professionalism from the staff was essential, and particularly the need for patient confidentiality”.  Indeed, on various occasions, Botony Dental Corp.’s principal had congratulated and positively reinforced Partridge’s work.  In this context the Court found (with respect to the specific allegations above):

1. Botony unilaterally changed Partridge’s hours and retaliated when Partridge reminded Botony of its legal obligations to accommodate her based on family status (she just returned from mat leave and would have to make difficult/costly daycare arrangements to accommodate the new schedule).
2. The evidence didn’t point to Partridge harassing coworkers and management.  She didn’t interfere with patient scheduling and no evidence that she caused disruption in the workplace.
3. Partridge wasn’t being insubordinate when she refused to meet with Botony’s principal without a witness; Partridge was genuinely concerned with her job security (for good reason).
4. Partridge never opened a competing business or even came close to implementing the steps necessary to operate a dental practice.  There is no evidence that she leased equipment or space, made an offer, or made an application to obtain financing.
5. With respect to copying patient records, there was no definitive evidence that this happened.  The Court believed that Partridge understood the importance of confidentiality and ethical breaches and therefore found that she had not printed off or removed patient or financial information.
6. 35 patients left the practice following Partridge’s termination, but Partridge proved that these were personal friends and not all calls were placed in relation to changes in Partridge’s employment.  Only 7 of those 35 actually came to Partridge’s new employer.  Not all of the individuals transferred their files to the office where Partridge is now working.  And there were many reasons why patients transferred to new practices (e.g. residential changes).
7. The day sheets which Partridge accepted taking were supposed to have been left in the office.  But such an isolated incident is not grounds for summary dismissal.  The purpose of removing them was not to harm the defendant’s business or use them to solicit the patients listed there, but to keep them as evidence.

IN SUMMARY: the termination was unwarranted and Lee Partridge was entitled to seek damages for wrongful termination.  She ultimately received (among other awards) $42,517.44 as damages (which coincided with a 12 month notice period she should have received had she been terminated properly, i.e. with notice).

MORAL OF THE STORY: as a dentist employer, you need to be careful when terminating someone for “just cause”.  Sometimes, to avoid a costly and lengthy lawsuit in case you get it wrong, it would have made more sense to simply provide them with notice!

In the next blog, I’ll discuss what constituted reasonable notice in this case (i.e. the amount of time and equivalent money that Partridge was entitled to for being terminated unjustly).