Render v ThyssenKrupp Elevator (Canada) Limited – Implications for entitlements to ESA minimums
The recent Ontario Court of Appeal decision, Render v ThyssenKrupp Elevator (Canada) Limited (“Render”), 2022 ONCA 310, clarified the distinction between “just cause” at common law and “wilful misconduct” under the Ontario Employment Standards Act, 2000 (the “ESA”). Prior to this decision, courts typically treated the two classifications of “just cause” and “wilful misconduct” to mean the same thing and result in the same consequences, which was a loss of severance pay under both ESA and common law.
As a result of Render, the standard for not qualifying for ESA entitlements is now separate and a more demanding requirement than the standard to demonstrate “just cause” under common law. If an employee is terminated for “wilful misconduct,” they must be guilty of deliberately doing something they know to be wrong, thus excluding them from their minimum ESA entitlements (i.e., notice of termination or pay in lieu thereof, benefit continuation, and severance pay). The misconduct must be wilful and premeditated, quasi-similar to what is required under criminal law.[1]
In Render, the trial judge found that the terminated employee’s actions, while intentional, were not preplanned. The court found that while his conduct amounted to just cause, it did not amount to “wilful misconduct,” and he retained his entitlement to the ESA minimums.
It is important for employees and employers to remember that termination for just cause will not absolve the employer of their obligation to provide terminated employees with their minimum ESA entitlements. A dismissed employee should only be deprived of these entitlements where their misconduct was deliberate and preplanned, and the employee understood the conduct to be wrong.
What is the difference between a ‘Just Cause’ vs. ‘Wilful Misconduct’ termination?
A just cause termination occurs when an employer fires an employee due to misconduct such as insubordination, or dishonesty. The employee’s behaviour is so severe that no employer should be expected to tolerate it.
“Wilful misconduct,” however, is a narrower and more specific term. As clarified by the Ontario Court of Appeal in Render v. ThyssenKrupp, wilful misconduct means the employee purposefully engaged, in both an intentional and premeditated manner, in conduct they knew was wrong. Only in such cases can an employee be denied ESA minimum entitlements like termination pay and severance pay provisions.
What is the difference between wilful misconduct and misconduct?
Misconduct is a broad category that includes a range of poor workplace behaviours, such as negligence, lateness, or poor judgment, which can be interpreted as inadvertent conduct.
Wilful misconduct, or the wilful neglect of duty, refers to intentional, preplanned conduct that the employee knew was wrong. The standard resembles what’s seen in criminal law. Wilful misconduct must show the employee purposefully acted in a way they understood to be inappropriate. It is this threshold that can remove an employee’s right to notice or statutory benefits.
What is an example of wilful misconduct?
An example of wilful misconduct would be an employee intended to violate a serious workplace rule in a premeditated way, such as purposely falsifying safety records or engaging in workplace violence after being clearly warned such behaviour would result in termination.
By contrast, in Render, the employee’s behaviour was deemed intentional but not preplanned, and therefore did not amount to wilful misconduct under the ESA. The conduct warranted dismissal, however, he was still entitled to minimum notice and severance, despite being dismissed for just cause.
What qualifies as just cause for termination?
In Ontario, just cause for dismissal can arise when an employee’s behaviour is so serious that it irreparably damages the employment relationship. Actions that may justify this include theft, fraud, serious insubordination, or (sexual) harassment, particularly when such behaviour involves threats, bullying, or physical violence. Breaches of trust, such as disclosing confidential information or engaging in a conflict of interest, can also amount to just cause. In cases involving substance abuse, dismissal may be justified if the employee’s conduct compromises safety or performance and they refuse appropriate support or accommodation. Chronic absenteeism or persistent lateness, especially after prior warnings, may also qualify if it disrupts operations.
How can an employee or employer benefit from legal advice regarding termination?
We encourage you to seek legal advice to better understand employee entitlements and explore a claim’s viability.
For employees, understanding whether a situation amounts to wrongful dismissal or wrongful termination often requires a close review of the facts, including any applicable employment contract. Legal guidance can help clarify entitlements such as notice, severance, or benefits, and determine whether the employer’s actions were legally justified.
At Whitten & Lublin, we regularly advise on wrongful dismissal claims, contract interpretation, and other complex workplace issues. If you’ve been let go, or simply want to understand your rights under your employment contract, we’re here to help. Contact us online or call us at (416) 640-2667 to speak with an experienced employment lawyer about your situation.
[1] It should be noted that the standard of wilful misconduct is specific to the Ontario ESA and may not apply to legislation from other jurisdictions.
