This Fact Sheet reviews terminating (firing) employees.

Termination means ending the employment relationship, commonly known as firing, dismissing, or letting someone go. Termination is not to be taken lightly. While employers can terminate employees at any time, their reasons for doing so may give rise to claims for wrongful termination. Terminations cannot be retaliatory or in violation of human rights law. Retaliation means dismissing an employee for punishment or revenge. Examples include firing an employee who files a workplace safety claim (or for raising the safety issue) or because the employee was pregnant or on maternity leave.

Employers may terminate any employee “without cause” so long as they provide notice or pay in lieu of notice. Without cause means there is no specific reason for the termination. Whether with or without cause, employers must give notice of termination to the affected employee.  Employers can require a terminated employee to work until the end of the notice period, e.g., two weeks, or provide them with pay (compensation for length of service) instead of notice. Prior to termination, best practice is to confirm that any underlying human rights issues are addressed. 

Employers may also terminate an employee for just cause without any notice. Just cause means an employee has done something seriously incompatible with the continuation of the employment relationship. Examples include intentionally disregarding duties (non-performance), and dishonesty such as stealing (behaviour). It can be  very difficult to prove just cause for terminations. Performance or behavioural issues must be documented. 

Terminating an employee for cause is a serious matter presenting a risk to the employer on many levels. Firing someone may lead to claims made in many different areas including employment standards, civil litigation, human rights, and employment insurance.  In this situation, seeking legal advice may be the appropriate course of action.

It is possible to indirectly terminate an employee through what is called a constructive dismissal. Constructive dismissal means changing the work situation in such a fundamental way that, in law, it is the same as terminating the employee. For example, a demotion (reducing a supervisor to a position with no supervisory authority) or changing of job duties is a fundamental change. If the employee does not accept the changes, they have the same rights as someone who was terminated without cause, to challenge the employer’s decision.  
 

This Fact Sheet covers the discipline of employees.  

Progressive discipline is an important issue for employer’s legal compliance.  Documenting disciplinary action may allow an employer to avoid an Employment Standards complaint or other litigation.  Employees are disciplined for both performance and behavioural issues:

• A performance issue is something that relates to the ability to perform the duties of a position. Poor performance issues can result from incompetence (lacking skills and abilities) and poor time management. For example, failing to meet assigned deadlines is a performance issue.
• Behavioural issues are not confined to the ability to perform the specific duties of a position. These issues include larger workplace issues like misconduct and rule-breaking. For example, consistently being late for work and workplace intoxication are behavioural issues.

Best practice is to have a discipline policy to address employee performance and behavioural issues. A discipline policy outlines the steps to follow in an attempt to modify poor performance or problematic behaviour. Issues requiring discipline are an important part of performance management. As such, the need for discipline typically arises out of a performance review.

A good discipline policy includes progressive steps to address job performance or conduct problems. For example, a common first step in a discipline policy is a written warning to improve performance or correct a behaviour. 

Discipline should only be used for culpable misconduct. Culpable misconduct is inappropriate and deliberate behaviour that violates the employment relationship. The behaviour must be intentional and the employee at fault. For example, an employee who calls in sick when they are not, is acting intentionally. 

Employers must ensure that discipline is fair and unbiased. Human rights law forbids discrimination (unfair treatment based on a personal characteristic) in employment at all stages, including discipline. 
 

This Fact Sheet reviews some of the best practices for managing employees in the workplace.

Workplaces are best managed with clear expectations. Best practice is to establish and enforce expectations through workplace policies, accurate job descriptions, and regular performance reviews.

Workplace Policies

Workplace policies set out the expectations for the workplace as a whole i.e., how a particular workplace is meant to function. These policies must comply with the applicable law. Examples of workplace policies include those that cover: 

• Overtime
• Leaves and time off
• Discrimination
• Bullying and harassment
• Privacy/confidentiality

Best practice is to provide all employees and volunteers (including Board members) access to workplace policies and to train them in the application of those policies.

Job Descriptions

Job descriptions set out the expectations for a particular position. A job description outlines the actual day-to-day responsibilities of a position and to whom the position is accountable (supervisor).

A job description may be as simple as a statement of what the employee in the position will be doing and to whom they will report (if anyone). It also guides the performance review process. 

Performance Reviews

Performance reviews set out the expectations for a particular employee. A performance review evaluates how well an employee is performing the tasks set out in their job description. The purpose of a performance review is to both support a worker's strengths and to identify weaknesses. 

Best practice is for performance reviews to adopt an objective standard for performance. An objective standard relies upon observable and measurable facts, rather than on opinions. For example, “submitted X number of reports” is an observable and measurable fact while “lazy and didn’t do much” is an opinion. 

Following a performance review, the law requires that employees are given the opportunity to improve weak performance or bad behaviour. Further, employers must give clear directions and warnings before taking any disciplinary action such as termination. Termination is covered in the Discipline Fact Sheet.
 

This Fact Sheet describes the use of written employment contracts.

An employment contract is a legal document that should include the expectations of an employer. This information typically includes a description of the position and responsibilities, rate of pay, and hours of work. Best practice is to use written employment contracts for all positions. 

Employment contracts must follow the applicable employment laws. The applicable employment laws depend on “jurisdiction”. For BC, it is usually the Employment Standards Act but for federal employees like banks, it is the Canada Labour Code. Employment contracts should cover the following key components:

• Rate of Pay, Overtime, and Vacation entitlement
• Position responsibilities and reporting
• Start date
• Performance expectations
• Benefits
• Absences from work e.g. sick leave, vacation
• Confidentiality requirements (if needed)
• Termination and Notice (ending the employment relationship)

Written employment contracts serve valuable risk management purposes. Risk management means anticipating and planning for something unexpected that might happen in the future. One example is overtime hours. If hours of work and overtime are not addressed in an employment contract, non-profits may be faced with claims for overtime hours that fall outside of its budget for salaries and wages. These claims for overtime pay may present a serious financial risk.
 

This Fact Sheet reviews best practices for a hiring process.

The hiring process is an integral part of the employment relationship. This process must be fair. Unfairness in a hiring process may open the non-profit to complaints under human rights law.  

Non-profit employers must actively seek to avoid unconscious bias in the hiring process. Unconscious bias is an attitude about the characteristics or qualities implicitly applied to groups of people. This attitude results in favouring or discriminating against people based on underlying assumptions about them, rather than on their actual abilities. Unconscious bias becomes a legal issue when it affects hiring decisions. 

Steps in the Hiring Process

Best practice is to outline the steps in a hiring process in policy. These steps typically include: describing the position and setting selection criteria, advertising/posting, assessing applications (short listing), interviewing, checking references, and making job offers. 

Unfairness in the hiring process may result from: skipping one or more of these steps, following different steps for different positions, and allowing unconscious bias to influence decisions at one or more of the steps. Non-profits should actively seek to avoid such unfairness.

Fairness

A fair hiring process is based on ability to do the job and is objective, consistent, and non-discriminatory. Fairness includes addressing the possibility of unconscious bias. Fairness applies at all stages of the hiring process including the details in the posted position, the screening potential candidates, interviewing, selection, and offer. For example, in an interview there may be an expectation that candidates be outspoken and self-promoting. This expectation may be biased against some candidates whose culture prioritizes listening (rather than speaking) skills and sees self-promotion as bragging.

Sample Steps in a Fair Hiring Process

1. Create a job posting that accurately reflects the duties and qualifications for the position and salary.
2. Create a balanced hiring committee with particular attention to human rights considerations such as gender balance.
3. Select applicants to interview based on the criteria established by the hiring committee.
4. Plan the interview questions in advance along with a grading matrix for the responses.
5. Interview the candidates and evaluate responses based on the grading matrix.

Discrimination

Non-profits have a legal duty to not discriminate in hiring. Discriminate means treating someone differently because of a personal characteristic such as Indigenous identity, sexual orientation, or gender identity or expression. The legal obligation not to discriminate includes taking all steps to avoid discrimination. This obligation  is examined in more detail in the Human Rights module. 
 

This Fact Sheet reviews the legal differences between employees and contractors.

Workers are people who do work for others and get paid for that work. Workers may do this as self-employed, be in business to benefit themselves and have many different clients (contractors), or may do work solely for the non-profit.

The legal difference between workers who are contractors and those who are employees may seem insignificant for the day-to-day operations of a non-profit. Presumably each gets the work done and is paid for that work. The distinction is important for the tax and benefit implications and for the availability of employment standards protections. Getting it wrong is problematic and can adversely affect a non-profit’s bottom line.

The difference between employees and contractors is often confusing:

• Both can have contracts describing the work they do and how much they will be paid.
• They may both be referred to either as “employee” or as “contractor” by others. A worker may be called a contractor while in law, the worker is an employee or vice versa.

One of the important practical and legal differences between employees and contractors is that employers must make deductions for taxes, CPP and EI, from the wages of employees and “remit” (send) those amounts to the Canada Revenue Agency.

The factors used by the Canada Revenue Agency (“CRA”) to determine if a worker is an employee or a contractor are: control, tools and equipment, financial risk/reward, dependence, and intention of the parties. These factors are described in the chart below. The CRA looks at all the factors and weighs them together to decide if a worker is more likely an employee or a contractor of the non-profit paying for the work (“payer”).

If a worker is found to be an employee rather than a contractor, the non-profit could:

• Owe wages for sick pay, vacation pay, overtime, parental leave, or severance.
• Owe contributions to CPP/EI for both the employee and employer portions going back 6 years.
• Owe income tax deductions.
• Owe workers’ compensation premiums.
• Potentially face increased future premiums, legal costs, and penalties.
• Potentially face damages if the worker is found to be an employee who was wrongfully dismissed.

This Fact Sheet provides information about getting ready to be an employer.

Hiring readiness means being ready to be an employer. Ready means being aware of the rules around hiring workers. Ready also means having processes and policies in place for hiring and managing workers. 

Non-profits who follow these five readiness steps will set themselves up for success in employing workers:
 

1. The first step in hiring readiness is learning about the different types of workers. A worker is someone who performs services and is paid for those services. A worker may be either an employee or a contractor. The difference between employees and contractors is important. The difference affects the rules that apply to the relationship. This fact sheet is about getting ready to hire “employees” as an employer. An employer hires, directs, or is responsible for (controls) the work of employees who are entitled to wages (and perhaps benefits) for that work.
2. The second step in hiring readiness is to learn about the laws that apply to the workplace. These laws include those that cover employment standards, human rights, occupational health and safety, and government payroll deductions (income tax, CPP, and employment insurance). A non-profit’s board and executive director must know all of the laws that apply to its workplace.
3. The third step in hiring readiness is creating human resource policies and procedures that follow the applicable laws. Policies and procedures are the rules for the workplace. Policies are statements of the overall vision for how the workplace will operate. Procedures describe how that vision will be carried out. For example, a policy may say a non-profit will provide a safe workplace. The procedures will outline the steps the non-profit will follow to ensure a safe workplace such as requiring employees to wear personal protective equipment.
4. The fourth step in hiring readiness is to register as an employer with the Canada Revenue Agency (CRA). The Canada Revenue Agency (CRΑ) administers the tax laws in Canada. Employers are required to withhold certain amounts from the wages of its employees (deductions) and to send those amounts to the appropriate place (remittances). Employers should have record keeping systems in place to meet these employment-related deduction obligations.
5. The fifth step in hiring readiness is to register as an employer with WorkSafe BC. WorkSafe BC is responsible for workplace safety in BC. WorkSafe BC provides coverage for employees injured on the job. This coverage protects employers from lawsuits by those employees.
6. Contracts with contractors should ensure that the worker understands that they will be responsible for applicable taxes and Worksafe registration.