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December 2012

Dismissal with just cause is assessed through contextual approach

The Supreme Court of Canada previously established that when assessing if an employee was dismissed with just cause, a trial judge must apply a contextual approach when reviewing all relevant facts.1

In Bennett v. Cunningham2, the Court of Appeal for Ontario upheld a trial judge's finding of dismissal with just cause, concluding that the decision was based on a contextual approach that analyzed the entire factual record.


Bennett was a junior lawyer in Cunningham's law firm. In July 2002, Bennett became concerned that she did not have the resources and technology needed to manage her files. In response, Cunningham instructed her staff to create a file list for Bennett's files. Cunningham also invested in voicemail and time docketing software. In November 2002, Bennett expressed concern that not all of her billed fees were collected from clients and that some time dockets were incorrectly entered. Cunningham told Bennett that these errors would be corrected. Prior to Christmas, Bennett wrote to Cunningham listing nine areas of concern. The letter contained numerous allegations to the effect that Cunningham was dishonest, negligent, disorganized and incompetent. However, Bennett expressed her wish to work with Cunningham to resolve the issue. In January 2003, Bennett was terminated.


The decision also warns employees to be mindful of their language when criticizing their employers, and to ensure that any allegations against their employers can be fully substantiated.

The trial judge found that Cunningham properly responded to Bennett's concerns. Bennett had been "insolent to the extent that the employment relationship could no longer be maintained" and that the letter "was highly critical of the operations of the law office and of Ms. Cunningham's integrity."3 The events leading up to the letter, as well as the letter itself, undermined Cunningham's confidence in Bennett such that Cunningham had just cause to terminate.

Divisional Court

The Divisional Court held that the trial judge failed to apply a contextual approach to a determination of just cause for dismissal. Although Bennett's letter was harsh, it was a private communication focusing on administrative issues. The letter was not distributed publicly and did not cause the employer embarrassment or financial loss. Further, the Divisional Court held that there is a "strong public policy interest in encouraging open and frank discussion between employer and employee." It concluded that Bennett's letter did not create a situation in which trust in the employment context was destroyed.

Court of Appeal

In reversing the Divisional Court's decision, the Court of Appeal held that the trial judge properly applied a contextual analysis when considering all of the facts before him. The trial judge was entitled to make conclusions based on his analysis of those facts, and absent a palpable and overriding error, his decision will not be overturned.

Impact of decision

Employers may succeed in a dismissal case with minimal evidence, provided that the evidence clearly demonstrates deterioration in the employment relationship. The decision also warns employees to be mindful of their language when criticizing their employers, and to ensure that any allegations against their employers can be fully substantiated.

1 McKinley v. BC Tel, 2001 SCC 38.
2 2012 ONCA 540.
3 Supra, paras. 10-11.



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