THE IMPORTANT ROLE OF PERFORMANCE REVIEWS IN THE PROGRESSIVE DISCIPLINE PROCESS

Amy Gibson Partner, MLT Aikins LLP

Performance reviews and progressive discipline can play a critical role in establishing grounds for discipline and just cause termination of employment. They provide a well-documented record of employee behavioural issues and ensure employees are notified about unsatisfactory performance. They also provide important documentation of the opportunities the employee was provided to correct undesirable behaviour prior to termination.

Progressive Discipline

Progressive discipline is a tool that is frequently under-utilized or misapplied by employers. Employers will run into problems where they plan to terminate an employee for just cause, but realize that they have not properly engaged in the progressive discipline process. Failing to engage in progressive discipline can also give the employee the false impression that the employer has condoned a particular type of behaviour. Accordingly, progressive discipline is an integral tool that employers should utilize prior to more permanent measures being taken.

In brief, progressive discipline requires that an employer implement increasingly severe disciplinary steps designed to modify an employee’s behaviour before the employer terminates a worker’s employment. The underlying principle is one of preventative and corrective action – the intention is that the employee will learn through experience and will face the threat of increasingly serious discipline if their behaviour is not corrected.

Progressive discipline can be beneficial for employers in two regards. Generally speaking, progressive discipline allows an employer to:

1. Intervene and communicate to an employee that their behaviour or actions are unacceptable and to correct issues early; and

2.Create documentation to demonstrate that an employee was treated fairly and was appropriately warned of the consequences of their actions. Where progressive discipline eventually leads to a termination for just cause, documentation confirming that an employee was made aware of the issues and was clearly warned of the consequences of continued problematic behaviour may provide the employer with a defensible argument for termination for cause.

Progressive discipline is more commonly used where a single incident of misconduct is not so egregious so as to justify termination for just cause.

Managing employees who continuously violate a workplace policy or fail to perform their job duties can be frustrating for employers. When progressing down the path of progressive discipline, employers should be mindful that if an employee repeatedly engages in the same type of misconduct it may be appropriate for the employer to move through the progressive discipline process more quickly than if the employee were to engage in unrelated types of misconduct. Ultimately, each case of progressive discipline should be assessed individually based on the specific circumstances of the case.

The Law of Progressive Discipline

Courts are typically more likely to uphold a just cause termination where an employer has established clear behavioural expectations for employees and where the employer has provided clear and unequivocal warnings to the employee of contraventions, and of the consequences for repeated misconduct, namely, the termination of employment.

Written documentation of the progressive discipline steps is particularly important in this regard. This documentation should also be referenced in the employee’s performance review.

An example of a case where an employee’s termination for just cause for incompetence was upheld is the Saskatchewan case of Schutte v Radio CJVR Ltd., 2009 SKCA 92 (“Radio CJVR”). In that case, the Saskatchewan Court of Appeal overturned what it held to be an overly stringent test imposed by the trial judge, ultimately holding that the applicable standard for just cause termination for incompetence is not one of an employee being “incapable” of performing their job duties, but a question of whether the individual was “consistently failing to meet a reasonable standard of performance” (Radio CJVR at para 17).

A key takeaway from the Radio CJVR case is that the Court of Appeal noted that, while the standard of deficiency necessary to constitute grounds for summary dismissal is stringent where there is no significant misconduct such as dishonesty or gross insubordination, the standard of incompetence to constitute grounds for summary dismissal for incompetence is less stringent where the employee has been provided repeated notice that their performance is deficient, considerable assistance has been given to help them improve, and clear warning was provided that failure to improve will result in termination of employment.

The Court of Appeal ultimately held that the employer’s expectations regarding job performance were reasonable, the employee failed to meet the reasonable standard of performance, the employer provided clear and unequivocal warnings, and the warnings clearly indicated that the employee would be dismissed if the standard was not met. Given these factors, the test for just cause dismissal was met and the employer was entitled to terminate the employee for just cause.

This case law example arose in a non-unionized setting. The principles of progressive discipline for non-unionized employees are similar in unionized environments, subject to the terms of the collective bargaining agreement between the employer and the union.

Employee Performance Reviews

Performance reviews are an important tool for setting and clarifying employment expectations, for encouraging exemplary workplace practices, and for deterring workplace conduct that is undesirable. A negative performance review, or a series of poor reviews, may be tendered as evidence that an employee was underperforming.

On the other hand, employers can run into problems where they have provided positive performance reviews only to attempt to terminate the worker’s employment for just cause when the worker’s conduct faulters. In these instances, the employee may rely on the positive performance reviews to argue that they were performing well and should not have been terminated for just cause.

The following are some recommended best practices for employers to ensure that performance review documentation aligns with what is actually occurring in the workplace:

• Performance reviews should be conducted regularly.

• A detailed written record should be created for each performance review that clearly and accurately outlines all matters discussed with the employee.

• Performance reviews should include a thorough canvassing of the employee’s performance to date, with specific attention given to areas where an employee is failing to achieve performance benchmarks.

• In circumstances where deficiencies have been identified, goals should be established and documented that will allow the employee the opportunity to achieve performance benchmarks.

A negative performance review will not, in and of itself, serve as sufficient notice of unsatisfactory performance such that termination for cause can be justified (see Coles v Dentech Products Ltd., [1994] BCJ No. 1680). There must also be a “clear warning that [the employee] had to take steps to avoid dismissal for unsatisfactory performance” (Coles v Dentech at page 8). Progressive discipline fulfills this purpose and performance reviews provide important documentation in support of these actions and decisions.

Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.