Canada: Insubordination And Poor Performance Constitute Just Cause For Termination

A recent decision of the Ontario Court of Appeal upheld the Ontario Superior Court's decision in Hoang v. Mann Engineering, wherein the Court held that an employer may dismiss an insubordinate and poorly-performing employee for just cause.

Background

The employee, Mr. Hoang, had been hired as the Chief Financial Officer of Mann Engineering a small engineering firm, which specialized in renewable energy. He was employed pursuant to a thirteen-month fixed-term employment contract. Almost immediately after Mr. Hoang began in his position, significant performance issues arose, including: neglect of duties, refusal to follow instructions, insubordination, and abusive behaviour towards his co-workers and superiors. After failed attempts by the employer's President, Mr. Mann, to mentor and coach Mr. Hoang, the employer terminated him for just cause after just eight months. Mr. Hoang alleged wrongful dismissal. 

The employer had hired Mr. Hoang to assist in a portfolio project for which he was responsible for raising capital. Despite specific directions provided by Mr. Mann, Mr. Hoang failed to meet deadlines, neglected to pursue financing opportunities, and failed to reach agreements with clients, causing significant losses to the employer.  

One of Mr. Hoang's significant issues was his "unprofessional, uncollegial, insolent" behaviour towards his co-workers and superiors throughout his tenure. Among other incidents, Mr. Hoang wrote in an email to the Vice-President that her actions were "idiotic", yelled and swore at a co-worker, and repeatedly called the employer "dysfunctional". When Mr. Hoang was required by Mr. Mann to apologize for his behaviour, he refused and continued to justify his actions. Consequently, the employer concluded that the employment relationship had suffered irreparable harm and decided to terminate Mr. Hoang for cause. 

Decision

In determining that Mr. Hoang's conduct constituted just cause for his dismissal, the Court considered whether there was "wilful disobedience". The factors considered by the Court included: whether the employee refused lawful orders of the employer intentionally or deliberately, and whether such conduct repudiated the employment contract or its essential terms. The Court found that Mr. Hoang's failure to complete tasks, proceed with projects as directed, and follow reasonable instructions of the employer on multiple occasions, amounted to insubordination.

The Court was also satisfied that the evidence from other employees who testified on behalf the employer was preferable to the evidence of Mr. Hoang, which it found to be self-serving and blatantly dishonest. The Court took note of the fact that Mr. Hoang, in his testimony and in cross-examination, refused to acknowledge or understand that his conduct and behaviour in the workplace was inappropriate and unprofessional. Specifically, the Court found Mr. Hoang's email correspondence to his co-workers and superiors were "condescending, disrespectful, arrogant ... and haughty" and displayed an "attitude of superiority" throughout his employment. The Court found such conduct to be completely unacceptable in any professional workplace.

Our Views

Dealing with insubordinate employees poses unique challenges for employers because insubordination or poor performance alone may not be sufficient to justify termination for cause. Accordingly, employers are often in the position of having to terminate insubordinate employees without cause (and paying them accordingly) or managing the behaviour. This decision demonstrates that certain factors, such as an accumulation of instances of insubordination, genuine attempts by the employer to mentor and improve the employee's performance and conduct, and the employee's refusal to acknowledge and apologize for his or her unprofessional behaviour may be considered by the Courts to find termination for cause. Key for employers is to maintain a record of instances of insubordination and any attempt by the employer to correct such conduct.

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