While courts have often held there may be just cause for termination based on certain off duty conduct, a recent case has gone the other way. Recently, in Merritt v. Tigercat Industries, 2016 ONSC 1214 (CanLII), the Ontario Superior Court of Justice reinforced the notion that an employer cannot rely on the mere existence of criminal charges to justify a just cause termination and that even a conviction itself may not be sufficient unless the crime has some connection with or impact on the workplace.

In this case, the employer had terminated the employee when they learned that he had been charged with two counts of sexual assault against a minor. Despite the fact that these charges were particularly awful, the Court granted the employee’s motion for wrongful dismissal as the alleged events did not occur in the workplace nor involve any other employees.

That is not to say that an employee’s improper conduct will only justify termination with cause if it occurs in the workplace or involves other employees. In fact, the Court provided a list of more ambiguous circumstances that may justify termination with cause including circumstances where the conduct harms the employer’s reputation or product. In this case, the employer provided no evidence as to damage or potential damage to the its reputation.

Note, none of this is to say that it wasn’t the correct business decision to terminate the employee in these circumstances. However, employers should understand that they may nonetheless be held liable for reasonable notice (and potential punitive damages if the termination is handled improperly) if cause can’t be proven and should consider alternatives including placing the employee on leave pending the outcome of a criminal case.

Written with the assistance of Nader Hasan, articling student.