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No Common Law Duty to Investigate Prior to For Cause Termination

The Court of Appeal of Manitoba recently confirmed that there is no common law duty on an employer to investigate prior to terminating an employee for just cause. While failing to conduct an investigation may result in additional damages if an employer is unable to establish cause at trial, there is no common law duty of procedural fairness when dismissing and employee and, as such, it follows that there is no duty to conduct an investigation prior to termination.

In the recent case of McCallum v Saputo, the Appellant employee was employed as a sales representative for Saputo Dairy Products. His job duties included attending stores selling Saputo cheese and identifying unsaleable product which would then be disposed of by store employees. McCallum was terminated for cause after removing 14 packages of cheese from a Superstore in Winnipeg which he claimed were unsaleable. Evidently, his explanation that he was going to personally dispose of the cheese, some of which was made by a competitor, was not compelling to either the store’s management or his employer.

A key issue was whether the employer had an obligation to conduct an investigation into the allegations against McCallum before terminating his employment. At trial, the judge found that Saputo was entitled to terminate McCallum for cause despite the fact that no effort was made to interview him or otherwise investigate the allegations of misconduct prior to termination.

On appeal, the court confirmed that, subject to certain exceptions such as the terms of an employment contract, there is no duty on a private sector employer to accord procedural fairness in employment relationships.

While this is certainly a positive case for employers, we at CCPartners would not go so far as to advise employers to dispense with investigations into misconduct. While there may not be a free-standing legal duty to investigate, flawed or inadequate investigations have resulted in punitive damage awards and are often cited at the reason why a defendant employer was unable to establish just cause at trial.

The CCP team can assist employers in navigating all aspects of the employment relationship, including terminations and investigations into misconduct. Please contact one of our lawyers who can assist with all of your workplace concerns.

Click HERE to access CCPartners’ “Lawyers for Employers” podcasts on important workplace issues and developments in labour and employment law.



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