you are a business owner contemplating terminating an employee’s contract but
don’t know how to proceed, this article is just for you. In this blog post, we
will draw out a comprehensive guide that will help you sail through the
termination of an individual’s employment with ease!
without further delay, let’s embark on this journey together and bid farewell
to termination troubles!
Understanding Employee Contract Termination: Likely Causes
we dive into the employee termination checklist, it is only fair to look at
what employee contract termination is and the likely causes.
an employee’s employment contract can be seen as the cessation or conclusion of
the employer-employee relationship, resulting in the employee no longer being
bound by the terms and conditions of their original employment agreement.
it should be noted that terminating an employee’s employment is a very
significant decision with legal and ethical implications. This is because, just
like employers, employees also have rights and legal backing that safeguard
them from illegal firing and all other work-related issues. So now, as an
employer, you can’t just wake up one day and decide to go on a sacking spree;
you need to have genuine reasons for doing that.
so, in the remainder of this section, we will look at some factors that could
cause an employee’s employment contract to be terminated.
- Poor Performance: One of the most
common causes of employment termination is when an employee performs
poorly at his or her place of work. If an employee consistently fails to
meet the expected job performance standards despite receiving adequate
training and support, the employer may decide to terminate their
- Misconduct: Terminating an employee’s
employment contract can also occur due to serious misconduct, such as
theft, fraud, harassment, violence, or other unethical behaviour.
- Violation of Company Policies: If an employee
violates a company’s laid down rules and
regulations, they could get sacked. While
this is even the least severe punishment, in some severe cases, an
employee who breaches a company’s policies, rules, or codes of conduct may
even get arrested if the violations significantly impact the organisation or its employees.
- Insubordination: If an employee consistently refuses
to follow instructions or demonstrates a lack of
respect towards their superiors, they
could be subject to termination.
- Corporate Restructuring or Merger: Even though this
is not the employees'
fault, during a corporate merger, acquisition,
or restructuring, an employee’s employment contract may be terminated.
The Employee Termination Checklist
we said earlier, terminating an employee’s employment contract is a delicate
situation that, if not handled properly, can have legal and ethical
implications. Therefore, as an employer, before you sack any of your employees,
there are various things that you have to do first and foremost.
1. Have Genuine Reasons for the Termination:
Much has already been said about
this in the earlier sections. As a business owner or decision-maker, you can’t
just decide to sack your employees randomly. It is neither ethical nor legal.
So, if you are contemplating terminating an employee’s contract, ensure the
reason is valid and not discriminatory. For instance, you have the legal right
to dismiss an employee if they are not performing well or if he or she does
something that goes against the company’s laid-down rules and regulations.
2. Review the Employment Contract and
If you have found a just cause to dismiss the employee, the next
step would be for you to examine the employment contract and company policies
to ensure compliance with termination provisions and procedures. This step
helps prevent potential breaches and ensures adherence to agreed-upon notice
3. Provide Written Notice or Pay in
If you are a business owner in Canada, before you terminate the
contract of an employee, you have to provide written notice or pay in lieu of
notice to the employee being terminated. It should, however, be noted that the
notice period varies based on the employee’s length of service and the
province. Failure to do this can lead to claims for wrongful dismissal.
4. Calculate Severance Pay (if
If the employee is entitled to severance pay, ensure that it is
calculated correctly. Severance pay in British Columbia is based on the
employee’s years of service and the number of employees being terminated.
5. Prepare a Termination Letter:
Draft a concise termination letter outlining
the reason for termination, the effective date, any entitlements, and contact
information for further inquiries. After you have prepared the letter, the next
step would be to deliver the news to the affected employee(s). The most
respectful and compassionate way to deliver such news is to privately
meet with the employee.
6. Recover all Company Property:
After you have delivered the news to
the affected employee, the next step would be to retrieve all company property,
including documents, access cards, electronic devices, etc. You should also
revoke the employee’s access to the company’s database, computer network, etc.
7. Inform Payroll and Benefits
Normally, you don’t want to pay someone not working for you. So
after you are done terminating an employee’s contract, the next thing to do is
company's payroll and benefits departments to stop
salary payments, deductions, and benefits for the terminated employee.
8. Final Pay Cheque:
While it doesn’t make sense to keep paying someone who is not
working for you, neither does owning a sacked employee make sense. Our point
here is that after you have dismissed an employee, ensure that you calculate
and give them the final paycheck, including any unused vacation pay or other
termination is a complex and sensitive process that requires employers to stay
well-informed about federal and provincial laws governing employment
termination in Canada and in specific provinces like British Columbia.
a lawyer review or create your employee termination checklist is key when
dealing with delicate matters such as terminations to ensure all relevant
federal and provincial laws are properly followed. The lawyers at Stevens and Company Law Corporation can assist you in ensuring that
your employee termination checklist is implemented most efficiently while
remaining compliant with applicable labor laws. Contact our experienced
employment lawyers at 1-250-248-8220 today for a free consultation!