A Saskatchewan radio station employee’s deficient performance gave the station the right to terminate his employment without payment in lieu of notice, the Saskatchewan Court of Appeal has ruled.
In 2002, Swift Current radio station CJVR began reformatting from a country music station into an “oldies” station. It hired Grant Schutte to be the program director, music director and on-air morning show co-host for its newly formatted station.
At about the same time, CJVR hired a consulting firm to help with the transition. The firm delivered several reports that were critical of Schutte in his various roles. The reports included suggestions for improvement.
The suggestions in the reports were communicated to Schutte, and he was advised that an improvement in his performance was necessary. Over time, CJVR did not see the improvements it wanted. The radio station let Schutte go and gave him $3,600 in severance pay.
Schutte sued the CJVR for wrongful dismissal. The Saskatchewan Court of Queen’s Bench agreed that the dismissal was wrongful and found he was entitled to $19,500, which was five months’ pay in lieu of notice.
“The complaints advanced may well, from CJVR's perspective, render Schutte an unsatisfactory employee,” said the Court of Queen’s Bench. “Its remedy lay in effecting termination on notice or pay in lieu thereof.”
CJVR appealed the decision to the Court of Appeal, which agreed Schutte could be terminated for just cause on the basis of incompetence. The court made a distinction between cases where an employee is unable to adequately perform and cases where the employee is able to, but does not adequately perform. The court said confusion had arisen because, in the latter circumstances, other courts had been deciding cases on the basis that capable employees who do not perform their jobs adequately due to their own negligence or lack of due diligence cannot be terminated for cause. However, the Court of Appeal said, in fact, these employees can be terminated for cause as long as four conditions are met.
Those four conditions are:
•The employer must provide reasonable objective standards of performance for the employee in a clear and understandable manner.
•The employee must have failed to meet the employer's reasonable standard of performance;
•The employer must give the employee a clear and unequivocal warning that she or he has failed to meet the requisite standard, including particulars of the specific deficiency relied on by the employer.
•The warning must clearly indicate the employee will be dismissed if he fails to meet the requisite standard within a reasonable time.
In Schutte’s case, the court found all four conditions had been met. For the first condition, the job expectations were described by Schutte himself in correspondence sent to CJVR before he began working. The second condition was met by reference to Schutte’s own testimony that he was only able to give “30 percent of one job; 30 percent of another and maybe 40 of another.” The third and fourth conditions were met by the discussions surrounding the findings in the consultant’s reports.
“While…it is clear that the standard of deficiency necessary to constitute grounds for summary dismissal is stringent where there is no misconduct such as dishonesty or gross insubordination, it is also true, in my view, that the standard is less stringent where, as in this case, the employee has been given repeated notice that his performance is deficient, considerable assistance to help him improve and clear warning that failure to do so will result in the termination of his employment,” said the court.
Employers, especially those in Saskatchewan, should take note of the four-part test for terminating underperforming employees for cause discussed in this decision.
For more information see:
• Radio CJVR Ltd. v. Schutte, 2009 CarswellSask 532 (Sask. C.A.).
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