Do employers have the right to suspend staff?

Judge outlines five-part test in recent case involving suspension without pay of employee charged with drunk driving

The decision in Reininger v. Unique Personnel Canada Inc. addresses a number of important issues. Does an employer have the right to suspend an employee without pay? What should an employer do when an employee is charged, but not yet convicted, of a criminal offense? If an employer has the right to suspend an employee, what should the duration of the suspense be?

The 1999 Ontario Court of Appeal decision in Haldane v. Shelbar Enterprises Ltd. suggested there was a need to revisit the issue of progressive discipline, including suspensions, in the common-law context. This decision is important because it is the first Ontario case to analyze the issue of progressive discipline in the common-law context.

Richard Reininger had been employed as a professional long-haul driver with Unique Personnel Canada Inc. for more than 12 years. On July 8, 2000, he was stopped by police and charged with impaired driving and driving with a blood alcohol level higher than .08. He was driving his own car at the time. Under Ontario’s Highway Traffic Act his license was immediately suspended for 90 days.

Reininger told his employer about the license suspension. Unique immediately suspended his employment without pay. It took the position it was entitled to suspend him until he was acquitted of the charges. At his wrongful dismissal trial, Reininger took the position the extended suspension was effectively a termination and sued for damages in lieu of notice.

On May 9, 2001, Reininger was convicted of driving with a blood alcohol level of .08.

The judge in the wrongful dismissal trial had to grapple with the general common-law proposition that an employer does not have a right to suspend an employee. Such suspension is equivalent to termination — either with or without cause. He also observed there appeared to be “no judicial authority ... dealing with the effect at common law of a mandatory temporary loss of a driver’s license, where it is basic to the function which the employee performs, before a trial of the underlying charges occur.”

After reviewing the expectation of the parties and their conduct, the trial judge found Unique had an implied contractual right to suspend Reininger without pay. Such right, however, had to be exercised reasonably. The judge determined it was reasonable for Unique to suspend him during the 90-day administrative license suspension. During that time Reininger was legally unable to perform his job duties. There was no obligation on Unique to find Reininger a non-driving position.

The more difficult question was whether Unique could suspend Reininger until the criminal trial. In reviewing this issue, the judge reviewed arbitral jurisprudence. He summarized a five-part test in reviewing the employer’s decision to suspend without pay when an employee is charged (but not yet convicted) of a criminal offense:

•Guilt or innocence is not the issue. The employer must determine, “whether the presence of the employee can be considered to present a reasonably serious and immediate risk to the legitimate concerns of the employer.”

•The existence of a criminal charge is not determinative of the issue of risk

•The employer must show it investigated the criminal charge in an effort to assess the risk. Where the police initiate the matter, the burden on the employer is less than when the employer initiates the criminal proceeding.

•The employer must review whether there are ways of mitigating the risk of continued employment, such as closer supervision or transfer to another position.

•There was a continued obligation to revisit the issue during the period of suspension to determine if the suspension continued to be appropriate.

In assessing Unique’s decision, the judge relied heavily on Reininger’s 12-year clean driving record. The employer never had any concern that Reininger had an alcohol problem. According to the judge, Reininger’s single lapse in judgment did not justify an extended suspension. The court found no evidence there was any serious risk to the company’s operations or co-workers. The court found the employer had not acted reasonably in extending the suspension beyond 90 days.

Unique also tried to use Reininger’s ultimate conviction for driving with a blood alcohol level exceeding .08 as after-acquired cause. The trial judge did not accept that driving with a .08 blood alcohol level was equivalent to a finding that Reininger’s driving ability was impaired at the time. Accordingly the court rejected the plea of after-acquired cause. The judge ruled Reininger was entitled to nine-month’s salary in lieu of notice.

The decision is crucial in providing an overview of the law regarding when an employer may have a right to suspend at common law and what factors an employer should assess when exercising that right. A notice of appeal was filed, but counsel has advised the matter has settled and the appeal will not proceed.

For more information see:

Reininger v. Unique Personnel Canada Inc. 2002 Carswell Ont 2355 (O.S.C.)

Haldane v. Shelbar Enterprises Ltd. (1999) 46 C.C.E.L. (2d) 267

Neena Gupta is an employment law lawyer with Goodman and Carr LLP in Toronto. She can be reached at (416) 595-2480 or [email protected].

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