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Ontario Dentists Ordered to Pay $25,000 for Wrongful Dismissal

By May 24, 2018August 17th, 2020Employment Law

The recent case of Rouse v. Drake & Drake et al. is a perfect example of how terminating an employee “for cause” can come back to bite you in the rear. Here’s what happened to Drs. Thomas and David Drake of Lion’s Head, Ontario:

Susan Rouse worked for the Drake brothers for 7.5 years in their home-based dental practice. Ms. Rouse was a receptionist and occasional dental assistant and she did not have a written employment agreement.

The Drake brothers found Ms. Rouse to be a bad employee and they merely tolerated her for the last year and a half that she was employed at their dental practice. Among other things, Ms. Rouse was constantly padding her hours and disobeying orders. However, the Drakes had very scant evidence that this was the case, including a few unsigned letters that they couldn’t verify were given to Ms. Rouse.

In June 2012 Thomas Drake fired Ms. Rouse “for cause”.

Ms. Rouse sued the Drakes for wrongful dismissal and alleged that she was owed 10 months of notice of termination or pay in lieu of notice.  The Drakes argued that Ms. Rouse was a bad employee and she was fired properly, for cause.

The judge found that Ms. Rouse was wrongfully terminated and was owed 8 months of pay in lieu of notice (approximately $25,000) PLUS  the Drakes were ordered to pay $10,000 in legal costs. He further found “no reliable evidence that Rouse falsified her work hours or claimed unjustified hours of work. We have only Thomas’ speculation that she must have because her work tasks did not take as much time to complete as Rouse was claiming…This court cannot base a finding of just cause for dismissal, a very serious consequence for any employee, on rank speculation”.

What’s more, Ms. Rouse alleged human rights violations, physical violence towards patients, sexual harassment, racist comments, etc. and sought both aggravated and punitive damages totalling $55,000. The judge found no evidence of such behaviour and commented that he doesn’t believe “for a moment that the Drakes are the racist psychopaths that they have been portrayed as…”

Takeaway Message for Dentist Employers

Termination for cause has been described by some judges as the “capital punishment” in employment law and for that reason, what constitutes “cause” is a very high threshold. An employer must prove not only that the termination was warranted for cause but also that the employee was aware of their shortcomings and given an opportunity to improve.

If you are thinking about terminating an employee for cause, here’s what you should do:

  1. CALL AN EMPLOYMENT LAWYER!
  2. Document EVERYTHING.
  3. Have a candid conversation with the employee telling them what the issues are and implementing a performance improvement plan.
  4. Introduce written employment agreements for all staff.

Item #1 above is key! Like the Drake brothers, other dentist employers have gotten themselves into a lot of legal trouble for terminating employees for what they believe to be “just cause”. Your employment lawyer will be able to guide you through the termination process and ensure that you don’t end up in court fighting for your hard-earned money and reputation like the Drakes.

This case also serves to teach dentists an important lesson in why all staff should have written employment contracts! If the Drakes had a good employment contract with Ms. Rouse, the most she would have been owed would have been 8 weeks of pay (in accordance with the minimum requirements of the Employment Standards Act). That’s approximately $561!! That’s much more palatable than the ~$25,000 + costs they now owe their former employee. So Item #4 above is just as important as the others.

If you need advice about termination for cause or presenting contracts to staff, please contact us today.  We are your legal dental team.

DMC