In my previous blog post, I explained how 2016 was a great year for employees. There was a notable case, however, that was decided in favour of employers. Below is a cautionary tale for probationary employees.
The case of Nagribianko v Select Wine Merchants Ltd was heard by the Ontario Divisional Court, and dealt with probationary employees. This was an appeal from the Small Claims Court in which the plaintiff, Alexander Nagribianko, was awarded four months of reasonable notice following the termination of his employment during his probationary period.
Mr. Nagribianko signed his employment agreement (“Agreement”) with Select Wine Merchants (“Select”) on May 14, 2013, and commenced his employment on May 27, 2013. Included within this agreement was a clause stipulating that he would be subject to a six-month probationary period. Mr. Nagribianko was terminated on November 21, 2013, well within the probationary period, as his employer considered him to be “unsuitable for regular employment”. Mr. Nagribianko sought damages for wrongful dismissal.
The Deputy Judge in Small Claims Court had an issue with the meaning attached to “probationary period”. Mr. Nagribianko never received a copy of Select’s employee handbook (“Handbook”), in which it was stated that an employee could be terminated during his or her probationary period upon providing written notice or payment in lieu of notice under the Employment Standards Act (“ESA”), although the Handbook had been incorporated by reference in his Agreement. The Deputy Judge held that the meaning of “probation” was not clear on the face of the Agreement without the Handbook, and as such awarded Mr. Nagribianko four months’ salary and benefits in lieu of reasonable notice.
On appeal, the Divisional Court confirmed that the standard for dismissal from non-probationary employment is just cause. However, it then went on to describe a different standard for dismissal from probationary employment – suitability. The court explained the nature of a probationary period as follows:
“Probation is a testing period for the employer to assess a probationary employee’s suitability. It offers the employer an opportunity to determine if the employee will work in harmony with the organization, if hired permanently. Suitability includes considerations of the probationary employee’s character, ability to work with others, and ability to meet the employer’s present and future standards.”
The court confirmed that in the absence of bad faith, an employer is entitled to dismiss a probationary employee without notice and without giving reasons, so long as it gave the employee a fair opportunity to demonstrate their suitability for permanent employment, and that probationary employment is inconsistent with any inducement or promise of long-term employment. In the court’s opinion, the term “probationary employment” was understood by a reasonable person to mean a period of tentative employment during which an employer would determine whether the employee was suitable for permanent employment.
It must be remembered that this case focused on reasonable notice. There was no mention of Select’s requirement to provide Mr. Nagribianko with his minimum notice under the ESA. However, since no employer or employee can contract out of the ESA, and this Act requires an employer to provide notice to a terminated employee who has worked for longer than three months, Mr. Nagribianko was nevertheless entitled to one week’s notice of his termination, or payment in lieu thereof, in accordance with the ESA.
If you have been terminated during your probationary period, please contact our Employment Law Group, as you may nevertheless be entitled to more than what the above case would suggest.