September 3, 2023

Lessons From A High Profile Termination

Most employee terminations rarely make headlines, but every so often one is monumental or surprising enough to garner news attention. Such was the case with Joe Natale, the ousted CEO of Rogers Communications, who is currently suing the company for the termination of his employment back in November 2021. 

The allegations in Natale’s recently filed statement of claim are serious. Along with the wrongful dismissal allegation itself, Natale alleges that the Rogers family (who sits on the corporation’s board) attempted to “tarnish his reputation,” including by hiring Brian Cox, who plays the patriarch on the popular TV show Succession, to film a humiliating video about Natale being replaced. 

The sums of money in the claim are significant, with Natale seeking $24 million in compensation to account for lost wages, as well as compensation he would have earned from a recent corporate merger had he still been employed. However, despite the large figures, there are many legal principles involved that are far more straightforward, and worth repeating for any employer. 

Investigate Fairly

In their Statement of Defence, the Rogers family claims that Mr. Natale was terminated after a workplace investigation, of which he was made aware. This covers two crucial steps in the termination process when there have been allegations of wrongdoing by an employee – even one in a position of power.

The first is to conduct a thorough workplace investigation. This can mean bringing in a neutral internal investigator who has no attachment to any of the parties, or if that is not appropriate or available then retaining an external workplace investigator. Workplace investigators are thoroughly trained in how to unpack the issues and interview anyone involved in order to gain a full account of the stories.

From there, investigators will review all of the evidence and can make recommendations to an employer on how to proceed based on their findings. Under Ontario’s Occupational Health and Safety Act (note that Rogers is federally regulated and so different laws apply), the employer must share the results of that investigation (not necessarily the full investigator’s report) with the parties involved.

The other noteworthy point is that Natale was aware of the investigation. In order to investigate fairly, all sides of a story need to be heard. When investigating workplace harassment, for example, the alleged harasser must have a fair opportunity to answer the allegations against them, including an unbiased interview, and ideally provided with questions or details in advance so that they can recall the incident without being panicked or flustered. 

Remember, there are multiple sides to any story, and workplace investigations are no different. A trained investigator should be the one to determine who is being truthful, and they can then guide an employer through what likely happened and how they can handle it.

Avoid Rash Decisions

When you learn of an employee’s bad behaviour, it can be tempting to terminate their employment immediately. You’ve worked hard to build a successful business, and the last thing you want is one ‘bad apple’ undoing all of that hard work.

Before making any rash moves, it’s often best to stop and take a pause. 

Remember, there are two types of termination in Ontario – with cause and without cause. Termination without cause involves providing an employee with working notice or pay in lieu of notice in accordance with their employment contract, or possibly what is known as ‘common law reasonable notice’ – in other words, how long it might reasonably take that employee given their circumstances to find new employment.

Doing this properly can involve crafting an intricate exit package, especially if employers are taking care to avoid a potential wrongful dismissal claim. The only surefire way to prevent a legal claim is if an employee signs a release in exchange for extended compensation, above and beyond what they may be owed under their contract, which they can earn in exchange for forfeiting any right to sue. 

Otherwise, those rash decisions can lead to a termination with cause in an attempt to send that employee out the door empty-handed. Just cause is known as the ‘capital punishment’ of employment law for a reason, but getting it wrong has serious consequences for an employer’s bottom line.

In most just cause cases, employers are at least required to pay out an employee’s minimum legal entitlements to termination pay and severance pay if applicable, which for a long-standing employee at a large employer in Ontario can equal up to 34 weeks. However, if an employer does not have a valid cause, and the employee sues for wrongful dismissal, the employer may be required to pay out additional money for acting in bad faith. 

Lastly, employers need to be cautious about making any decisions that infringe on protected human rights grounds. If an employee’s behaviour relates to their age, their religion, or their disability (including substance abuse), for example, employers must ensure that their reasons for termination are entirely unrelated to any of these protected grounds. 

The Upshot

While the termination at Rogers is notable for the amount of the claim and the notoriety of the company (along with the added measure of a recruited celebrity video), Ontario employers are regularly required to make difficult decisions about employees’ futures nearly every day. 

Employees can be unpredictable, and it can be surprising when an employee does something rash or unexpected that negatively impacts the company. Yet there are measures that employers can take to avoid this unpredictability, such as working with an employment lawyer. A trained employment lawyer can regularly review contracts, policies, and handbooks to ensure that employees have clear guidelines of what behaviour you’re expecting.

When employees do step out of line, consulting with a lawyer can help determine the next steps in a way that mitigates risk and lowers financial burdens where possible. While the decisions are ultimately yours, a lawyer can advise on the consequences of any action, and how any decisions might play out both for the workforce and for your business.

We routinely advise employers on all kinds of complex matters, not to mention all sizes of employment contracts. There are enough moving parts of any business to handle on a regular basis – don’t handle your employment issues without expert support. Contact us today to set up a consultation.