Should you conduct a workplace investigation before dismissing an employee for cause?

Workplace investigations are becoming more frequent. Sometimes employers have to investigate, particularly if there are allegations of harassment. Under the Occupational Health and Safety Act, employers must investigate incidents or complaints of harassment in a manner that is appropriate in the circumstances.

But what if it’s not harassment, but serious enough to dismiss an employee for cause? Like allegations of theft, fraud, or other serious violations of policy or law – must you investigate?

Courts have been reluctant to impose a duty on employers to investigate. Some cases have stated that an employer need only decide whether to dismiss an employee for cause based on all relevant facts and need not provide the employee with any procedural rights (Dziecielski v. Lighting Dimensions Inc., 2012 ONSC 1877).

But recent cases show that while courts are reluctant to impose a duty to investigate, courts have emphasized workplace investigations when there is a likelihood of a for cause dismissal. In McCallum v. Saputo, 2021 MBCA 62, the Manitoba Court of Appeal stated:

It remains the case in Manitoba that, at common law, an employer has no duty to investigate prior to dismissing an employee. That is not to say that such a course of conduct is without risk to an employer because, if it cannot establish just cause at trial, it will be liable for damages for breach of contract, as well as potentially for punitive damages for the manner of dismissal.

So it is a good idea to conduct an investigation if there is a chance the employee will be dismissed for cause.

If you are considering an investigation, here are some tips:

• Investigate impartially – The purpose of the investigation is not to build a case to support a dismissal, but to ascertain facts and come to a fair finding of whether an employee committed a violation. An unfair investigation may not stand up in court.

• Give the employee enough information – While the employee doesn’t need to be aware of every detail, they should at least have enough information to properly respond to the allegations. The employer should give the employee enough time to seek professional advice and respond.

• Investigate thoroughly – Employers should make sure to interview the employee and relevant witnesses, keep detailed notes and statements, collect relevant documentation, and outline their findings in a report.

• Consider placing the employee on paid leave – In some cases, particularly when the employee’s presence at work is a safety concern, employers should consider placing the employee on paid leave. Placing the employee on unpaid leave can lead to a constructive dismissal claim.

• Consider outside investigators – Where the employer does not have the resources to conduct a thorough investigation it should consider outside investigators. The nature of the allegations, importance of objectivity, required expertise, and costs, are factors employers should consider before hiring an external investigator.

Remember, while you don’t have to conduct a thorough investigation when dismissing an employee for cause in many cases, it is beneficial to do so especially if you want the for cause dismissal to hold up in court. And if you are going to investigate, make sure to do so fairly and impartially.