Statutory Framework (Employment Standards Code)
In Alberta, the Employment Standards Code (ESC) sets minimum requirements for termination notice or pay. Generally, an employer must give an employee advance notice of termination or pay in lieu of notice, based on the employee’s length of service. However, Section 55 of the ESC provides an important exception: if an employee is dismissed for just cause, the employer is not required to give any termination notice or pay. In other words, proving just cause allows an employer to terminate immediately without the minimum notice mandated by the statute.
It’s important to note that the ESC does not explicitly define “just cause.” The Code uses the term only to carve out the exception to notice, leaving the meaning of just cause to be determined by general legal principles. Because the legislation is silent on what behaviour constitutes just cause, Alberta employers and employees must look to case law (common law) for guidance. The ESC’s role is mainly to outline the employer’s obligations in a without-cause dismissal; if just cause exists, the statutory obligations to provide notice or pay are waived. (Even if terminated for cause, an employee remains entitled to earned wages, vacation pay, etc., but no notice or severance pay is required under the ESC).
Common Law Definition and Interpretation of Just Cause
Under common law, “just cause” for dismissal is a high threshold, often described as employee conduct so serious that it fundamentally breaches the employment contract and irreparably damages the employment relationship. The Supreme Court of Canada has established a contextual approach to determining just cause. This means courts will look at all the circumstances of the misconduct and the employment relationship to decide if dismissal without notice was a proportionate response. The employer must prove, on a balance of probabilities, that the employee engaged in misconduct and that immediate dismissal was warranted in the circumstances. In practical terms, the employee’s behaviour must be so incompatible with the employment relationship that “the employment relationship can no longer viably subsist” (i.e., the trust and working relationship are destroyed).
What Misconduct Constitutes Just Cause?
Not every act of misconduct will meet this stringent standard. Generally, just cause is found in cases of severe wrongdoing or repeated misconduct. Examples of conduct that Alberta courts (and courts across Canada) have recognized as just cause include:
- Serious dishonesty or fraud (theft, embezzlement, falsifying records).
- Gross insubordination or wilful disobedience of lawful orders (especially if it undermines safety or the employer’s authority).
- Violence or harassment in the workplace (abusive conduct toward coworkers, clients, or customers).
- Serious conflicts of interest or misconduct off-duty that harm the employer’s business or reputation.
- Chronic neglect of duties or incompetence after repeated warnings (an ongoing pattern of poor performance or negligence that the employee fails to correct).
On the other hand, minor issues or one-time mistakes usually do not amount to just cause on their own. Courts have made clear that occasional lateness, isolated errors, or general poor performance (especially without prior warnings) are not just cause for termination. Personal factors like an employee’s age, race, gender, or other protected characteristics can never constitute cause for dismissal. In essence, just cause is reserved for misconduct so serious that termination is justified, whereas ordinary “poor fit” or unsatisfactory performance should be addressed with warnings, coaching, or lesser discipline rather than immediate firing.
The Courts’ Contextual Approach in Wrongful Dismissal Cases
When an employer fires an employee and asserts just cause, it often leads to a wrongful dismissal claim if the employee disputes that cause existed. In such cases, courts will closely scrutinize the circumstances to decide if the employer met the high bar for just cause. Alberta courts follow the Supreme Court’s contextual analysis: rather than applying a rigid formula, they examine factors such as the nature and severity of the misconduct, the surrounding circumstances, and the history of the employment relationship. As the Alberta Court of Appeal noted, “dishonesty in and of itself does not automatically give rise to just cause… Instead, whether an employer has just cause to dismiss an employee… requires a broad contextual analysis”. The question is whether the misconduct was serious enough to strike at the heart of the employment relationship and destroy the mutual trust within the specific context of that workplace.
Courts typically consider several key factors when deciding if termination for cause was justified:
- Notice to the Employee – Did the employer clearly inform the employee that the conduct was unacceptable and could lead to termination if not corrected? (In cases of progressive discipline, were there prior warnings or performance improvement plans?)
- Severity of Misconduct – Was the misconduct grave enough to fundamentally undermine the employment relationship? (For example, theft or violence is more severe than a single missed deadline.)
- Fair Investigation – Before firing, did the employer conduct a fair and impartial investigation to establish the facts of the alleged misconduct?
- Proportionality and Past Practice – Did the employer use progressive discipline or consider lesser penalties where appropriate, or was termination a disproportionate first response? Also, had the employer condoned (tolerated) similar behaviour in the past?
These factors reflect that courts want to ensure a firing for cause isn’t done rashly or arbitrarily. For instance, if an employee had performance issues, the employer is expected to give warnings and an opportunity to improve; if the employer suddenly fires them without prior warning, a court may find no just cause because the response was not proportional.
Similarly, if an employer has consistently ignored or tolerated an employee’s misconduct, it sends a “mixed signal” – the courts may decide that the behavior was implicitly forgiven and thus not a valid reason for summary dismissal.
In one Alberta case, for example, an employer alleged just cause based on an incident of serious insubordination, but evidence showed the employer had previously tolerated outbursts and rule-breaking without discipline. Because the misconduct had been condoned over time, the board ruled that the final incident did not justify immediate termination in that context. This illustrates the principle that context and consistency matter – even objectively serious misconduct might not amount to just cause if the employer’s own conduct indicated it wasn’t fatal to the relationship.
Burden of Proof and High Threshold
Crucially, the burden of proving just cause lies with the employer. The employer must prove the employee’s misconduct and that dismissal was warranted as a result; if they cannot, the law will presume the termination was without cause and require the employer to pay damages. Courts often describe summary dismissal (firing with cause and no notice) as the “capital punishment” of employment law, reserved only for the worst offenders. Because a just-cause dismissal deprives the employee of the safety net of notice or severance (and can even disqualify them from Employment Insurance benefits), courts set a very high bar for an employer to justify it. The onus is on the employer to provide compelling evidence that the employee’s misconduct was so egregious that immediate firing was justified. If there is any doubt, the scales tip in favour of the employee – a dismissal will be deemed wrongful if just cause is not convincingly established.
In practice, this means Alberta courts tend to favour the employee in close cases. Recent court decisions in Alberta have emphasized how difficult it is to prove just cause, even where some misconduct occurred. In one case, an employee was fired for alleged misconduct, but the Court noted her 17 years of dedicated service and found no evidence of bad faith or disloyalty in her mistakes; it held that those mistakes did not meet the threshold for just cause. In another case, the employee had performance issues, but the employer never issued written warnings or followed its own discipline policy, so the court decided that while misconduct occurred, it “did not warrant termination” without notice. These cases show that judges carefully weigh the context – long service, the employer’s handling of the situation, the actual harm caused – and will often rule in the employee’s favour if the employer’s response seems too harsh or premature.
Common Law vs. Statutory Remedies
From a remedial perspective, if an employer successfully proves just cause, the employee is not entitled to any notice or pay in lieu under both the ESC and common law. The employment is effectively ended with no further obligation beyond paying earned wages up to the termination date. However, if the employer fails to prove just cause in a wrongful dismissal lawsuit, the dismissal is considered “without cause.” The employer then must provide the employee with reasonable notice of termination or pay in lieu, as required by common law (which often exceeds the statutory minimum notice). The court will assess damages, typically based on factors like the employee’s length of service, age, position, and the availability of similar employment (the well-known Bardal factors in common law). In short, lacking just cause means the employer breached the contract by firing the employee without adequate notice, and the court will order the employer to compensate the employee for that lost notice period.
Both the statutory and common law perspectives work together in practice: the Employment Standards Code ensures a floor of minimum notice or pay, except for just cause situations, while the common law provides a broader safeguard by requiring a true cause (as defined by jurisprudence) to deny an employee the full notice or severance they would otherwise be owed. Alberta courts interpret “just cause” very strictly – only egregious misconduct or an irreparable breakdown of the employment relationship will qualify. Employers must approach cause terminations with caution, knowing that any failure to clear this high bar will result in liability for wrongful dismissal.
Always seek legal advice. The above is for information purposes only.
Stephen Dugandzic received his Juris Doctor degree from the University of Alberta in 2013 and is Calgary-based. He previously practised with Bennett Jones LLP and Taylor Janis LLP before founding YYC Employment Law Group in 2018 and Evolution Legal in 2026.