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Problem employees: how can businesses survive them?

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Recently, Kim Stacy, owner of the now defunct Emma’s Eatery in Nova Scotia, sparked a social media debate by complaining that a frustrating new generation of employees has helped put her out of business.  Ms. Stacy complained that during the nine years her eatery was open, young employees demanded to be paid dearly for working shifts that did not interfere with social activities, hobbies and cell phone use and she described them as having an entitled attitude.  She also lamented that workers she has hired, regardless of age, often said they couldn’t work because they were “too stressed out” and couldn’t handle constructive criticism “so they quit instead of learning work ethic”.

Managing difficult employees can take up an inordinate amount of time. Most problem employees, in my experience, tend to be unhappy, mistrustful, are frequently late or absent from work, and leave employers with the challenge of managing performance and disciplinary issues.  Legal risks to an employer not only include the potential for litigation but also, as alleged by the owner of Emma’s Eatery, a shutdown of the business.

How should employers manage the risk?

Without a doubt, managing a problematic employee creates more than a few dilemmas. While avoiding litigation is a potent motivator, attempting to avoid litigation by keeping a difficult employee on staff isn’t the appropriate response.

I have assisted our non-unionized employer clients in navigating the risks by suggesting they take the following measures:

  1. Ensure that the company has clear and detailed job descriptions that are provided to an employee in advance of the employee commencing the job. The purpose of the job description is to set out expectations in relation to the work to be performed and is a document that can be referred back to in the event of a culpable failure to perform.
  2. Ensure that clear attendance policies exist and are properly implemented[i]. The policies should specifically include disciplinary measures that address culpable absenteeism and culpable lateness.
  3. Institute progressive disciplinary guidelines which include verbal, written and final warnings and which are disseminated and properly implemented[ii].
  4. Ensure that management staff is properly trained to identify problem employees immediately, understand how the policies work and how to properly ensure adherence to them, and that they know how and when to seek appropriate internal and external advice (including legal advice) as appropriate. While the threshold for terminating an employee for just cause is quite high, having evidence of progressive discipline is essential to a successful just cause termination where performance is the basis for the termination. Additionally, in the event of a termination without just cause, evidence of discipline or documentation regarding performance issues which are unrelated to prohibited grounds of discrimination under human rights legislation can be useful in defending against claims that the termination was a violation of human rights legislation.
  5. Insert termination provisions into the employment agreement which not only allow the employer to terminate on a without just cause basis, but properly limit the employer’s liability for such a termination.
  6. Make use of the above-referenced termination without just cause provision in the employment contract (assuming there are no legal obstacles to such a termination like a duty to accommodate). Often a termination on a without just cause basis is less expensive (both in actual costs incurred and management time spent) than trying to performance manage an employee who has demonstrated an incapacity or unwillingness to improve. However, if this option is engaged in a situation where performance is the reason for the termination, employer documentation can mean the difference between a successful (less costly) versus unsuccessful (very costly) termination. It is therefore critical to document, document, document!

Patrizia Piccolo


About the Author: Toronto Employment Lawyer Patrizia Piccolo is a trusted advisor to senior executives in transition; provides strategic advice and training to both large and small employers and their human resources and management teams; and is entrusted by employers and their counsel to conduct investigations into harassment and other problematic workplace behaviour. She also advises employers on employment related regulatory issues including, Employment Standards Act, Human Rights Act, Labour Relations Act and Workplace Safety and Insurance Act compliance.

[i] Proper Implementation includes providing employees with copies of the policies prior to the policy implementation date and  employees should be required to sign an acknowledgement and agreement form confirming that they are bound by such policies and that they understand and agree to the content.

[ii] See footnote above for proper implementation.