As justification for offering reduced termination packages to departing employees, employers often make bald and generalized allegations of misconduct and/or substandard performance. Although this aggressive approach sometimes has its advantages during the preliminary phases of negotiating a termination package, employers may face unintended consequences if the matter subsequently becomes litigious.

The Supreme Court of Canada abolished the doctrine of “near cause” almost two decades ago.  At common law, employees may be dismissed either without cause or with cause – there is no middle ground that justifies reducing the termination packages of departing employees. In that respect, it is no secret that establishing just cause for termination is an onerous task, and employers cannot solely rely on bald statements of improper conduct.

The need to particularize allegations of improper conduct will first arise at the pleadings stage.  Specifically, it is inappropriate for employers to baldly plead “misconduct”, “dishonesty” or “neglect of duty” without specifically detailing the events giving rise to those allegations. While this remains true whether the employee was dismissed without cause or with cause, it is especially pertinent in circumstances where the employee is denied any form of compensation.

The necessity of pleading with particularity was recently considered by the Ontario Superior Court of Justice in Mezin v. HMQ, 2016 ONSC 5171 (“Mezin”).  In that case, Mr. Mezin was a former employee of the Ontario Public Service (the “OPS”). During his employment with the OPS, Mr. Mezin complained that he was being subjected to bullying, discrimination and harassment by his supervisor. The OPS commissioned a workplace investigation, which apparently revealed that there was merit to Mr. Mezin’s complaints.  Notwithstanding that result, Mr. Mezin’s employment was terminated without cause shortly thereafter.

Mr. Mezin commenced an action seeking damages for wrongful dismissal, unlawful discrimination and infliction of mental distress. Mr. Mezin also alleged that the OPS breached its duty of honesty and good faith towards him.  The OPS delivered a Statement of Defence that broadly denied Mr. Mezin’s allegations. The Statement of Defence also made bald allegations relating to Mr. Mezin’s poor performance at the OPS, including:

• that there were “longstanding and widely held concerns with Mr. Mezin’s performance”; and
• that certain individuals did not have “anything positive to say about Mr. Mezin’s work performance”.

Mr. Mezin subsequently brought a motion seeking further particulars of the alleged performance issues, as well as the names of those individuals who purportedly made comments about his work performance. Mr. Mezin argued that he needed further details of those allegations in order to deliver a meaningful reply.

Ontario courts have developed a two-part test in determining whether particulars for a pleading should be ordered:

• the particulars are not within the knowledge of the party demanding them; and
• the particulars are necessary to enable the party to plead.

In granting the relief sought, Master Short applied the above considerations and relied on well-entrenched case law to eloquently summarize the level of disclosure typically expected for a Statement of Defence in a wrongful dismissal action. Specifically, where an employer pleads that the employee is guilty of misconduct, wilful disobedience, habitual neglect of duty or dishonesty, the relevant details must be pleaded with particularity:

… the minimum level of material fact disclosure for a statement of defence in a wrongful dismissal action, where the defendant employer relies on cause for the dismissal, is very high, and the pleading must contain sufficient detail so that the employee and the court can ascertain the exact nature of the questions to be tried, and so that the employee can meet the charge and respond in his reply accordingly.

Master Short further emphasized that the provision of such particulars at the pleadings stage is especially necessary given the statutory time limits currently imposed on examinations for discovery. In other words, that disclosure would permit effective preparation by counsel based on “specific assertions rather than guesswork”.

The decision in Mezin reminds employers that bald allegations of “misconduct”, “dishonesty” and “performance concerns” will rarely meet the proper standards of pleading in wrongful dismissal actions. Accordingly, employers would be well-advised to consider the content and specific nature of the events and/or facts they rely upon prior to making such assertions. Those considerations should also guide the employer’s risk assessment and decision-making process at the time of dismissal.

By failing to incorporate those considerations into their termination procedures, employers unnecessarily expose themselves to various risks, including:

• incurring significant costs to defend procedural motions;
• potential liability for acting dishonestly and/or in bad faith towards employees; and
• a public judgment condemning the employer’s practices.

Titus Totan

About the Author: Toronto employment lawyer Titus Totan supports both employee and employer clients in all areas of employment law, including employment standards, contractual and implied obligations, terminations, workplace investigations and workplace human rights.