A recent Ontario decision reminds employers of the importance of conducting a fair and fulsome investigation into employee misconduct before imposing discipline or dismissing the offending employee for cause, as failure to do so may expose them to costly legal claims.
In Czerniawski v Corma Inc. [Czerniawski], the Ontario Superior Court of Justice (the “Court”) found that an employer’s failure to inform an employee of the allegations of misconduct against him and provide an opportunity to respond was fatal to the employer’s assertion of dismissal for cause on the basis of that misconduct.
The employee, Andrzej Czerniawski, brought an action for wrongful dismissal following the termination of his employment with Corma Inc. for cause. The dismissal stemmed from a heated verbal dispute that Mr. Czerniawski had with a coworker (the “Dispute”).
Shortly after the Dispute, Mr. Czerniawski was instructed to go home right away because he had been involved in two incidents. He was further advised not to return to work until further notice. Mr. Czerniawski asked his supervisor to specify the incidents and what he was accused of, but did not receive an answer.
Four days following the Dispute, after having heard nothing from Corma Inc., Mr. Czerniawski attended at the workplace reception area to deliver a letter which detailed “his side of the story”. In the letter, Mr. Czerniawski denied that he had acted threateningly and demanded a formal apology.
Corma Inc. launched an internal investigation in which it conducted interviews and collected statements from its employees, including the coworker involved in the Dispute. Notably, Mr. Czeriawski was not contacted to participate in the investigation. Corma Inc. prepared an Incident Report following the conclusion of the investigation, but it is unclear whether a copy of the report was provided to Mr. Czerniawski.
Approximately one week after the Dispute, Corma Inc. delivered a letter to Mr. Czerniawski which advised of his dismissal for cause and specified two separate grounds for dismissal: first, that he had acted in a threatening manner to co-workers in an attempt to intimidate them; and second, that Mr. Czerniawski had been insubordinate by refusing to leave the workplace and then by returning to the workplace to deliver his letter, the contents of which Corma Inc. received as an indication that lesser discipline was impossible.
The Court endorsed a contextual approach to determine whether an employee’s misconduct justifies dismissal for cause. That approach will consider the particular facts of the employee’s behaviour, as well as the employee’s length of service and history of discipline. Employers must be able to show that in the circumstances, the sanction imposed was proportional to the severity of the employee’s misconduct.
The Court accepted that a verbal altercation had occurred between Mr. Czerniawski and his coworker. However, the Court expressed that some of the evidence provided by Corma Inc. regarding the events that followed and the alleged impact of Mr. Czerniawki’s conduct—including that it had led to genuine concerns for employees’ safety, and that coworkers became fearful of violence from him—was “overstated”. Relatedly, the Court noted that there had been no prior history of discipline, threats or violence related to Mr. Czerniawski throughout his 19-year tenure with Corma Inc.
The Court was critical of Corma Inc.’s one-sided investigative process for its failure to interview Mr. Czerniawski or obtain his version of events. As a result, the Court placed little weight on the resultant Incident Report. The Court also examined that while Mr. Czerniawski’s behaviour constituted insubordination and misconduct deserving of discipline, it must be considered in the context of Corma Inc.’s failure to inform Mr. Czerniawski of the allegations against him in a timely manner.
Finally, the Court noted that had Mr. Czerniawski been informed of the allegations and given an opportunity to respond, Corma Inc.’s response may have been more proportional to the misconduct that occurred. It found that progressive discipline measures, such as a disciplinary letter or suspension, would have been a more appropriate and proportional response in the circumstances. The Court found that Mr. Czerniawski’s lack of apology did not disentitle him from progressive discipline and did not indicate that such measures would be ineffective.
The Court ultimately found that Mr. Czerniawski’s misconduct did not justify dismissal for cause. Accordingly, he was entitled to, and awarded, 19 months of reasonable notice.
Employers are well advised to remember that investigations are key to mitigating against potentially costly legal claims. As noted by the Court in Czerniawski, an investigation allows employers to gather information, glean a fuller picture of what occurred, and determine an appropriate and proportional response based on the facts.
However, it is not enough to conduct a one-sided investigation; employers must also give due consideration to the fairness of the investigation process. Fairness requires an investigator, at a minimum, to provide the employee accused of misconduct with sufficient details of the allegations in advance of their investigation meeting, and a full and fair opportunity to respond to the allegations.
If employers act hastily to dismiss an offending employee, and the dismissal is later challenged through litigation, failure to conduct a sufficiently full and fair investigation process could not only be fatal to the employer’s defence, but could also result in substantial additional liability. Notably, Mr. Czerniawski had claimed aggravated and punitive damages for Corma Inc.’s failure to properly investigate. While the Court declined to award those damages, there are many other decisions in which such claims have resulted in significant damages awards.
Ultimately, employers would be well advised to take a careful approach to allegations of employee misconduct and to seek advice as to how to proceed with workplace investigations in order to minimize exposure to costly legal liabilities. As always, our lawyers and workplace investigators remain ready and available to provide appropriate guidance or conduct impartial workplace investigations on behalf of your team.
This blog is provided as an information service and summary of workplace legal issues.
This information is not intended as legal advice.