April 7, 2014
By Brad Smith
In Ludchen v. Stelcrete Industries Ltd. the Ontario Superior Court acknowledged that an employer’s duty to investigate is not clear. But the Court took a practical approach when it stated that “the failure of an employer to conduct an investigation into a serious allegation makes it difficult for an employer to later prove the allegation in a courtroom”.
The employee had allegedly engaged in misconduct, that if proven, would have been cause for termination. The difficulty is the employer terminated the employee without an investigation. The employer had hired an investigator, for other reasons, who reported the alleged misconduct. But neither this investigator nor the employer investigated the particular allegations relied upon as cause.
The case went to trial for 7 days. The employer had, at best, hearsay evidence, which is not admissible to prove the truth. The hearsay evidence came from the investigator who was not believed by the Court. The end result is the employer effectively had no evidence of the allegations of misconduct. The Court concluded the employee was terminated without cause and the employer had to pay 12 months of wages.
This case highlights the importance that the misconduct is cause for termination, but also the employer must have the evidence to prove the misconduct on a balance of probabilities.
The Take Away:
- Conduct an investigation
- Hire a competent and qualified investigator
- Gather direct evidence – do not rely upon hearsay evidence
- Assess the alleged cause before termination
- Confront the employee with the allegations and provide an opportunity to respond