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Just as every year Santa checks his list twice to see who has been naughty and nice, employers find this time of year to be suitable for reviewing employee performance. While the year-end performance review provides an opportunity for all to share their goals and targets for the new year, if not handled properly, assessment and criticism of an employee's performance can become a significant issue and dampen the holiday spirit.
Employers are best advised that, if possible, performance reviews be scheduled before the end of the year so that everyone starts with a fresh perspective after the holiday season. If the fiscal year end is calendar, this will also coincide with any bonus to which an employee may be entitled.
Employees are advised to share their goals and interests in certain types of work, and discuss how the work they would like to pursue those goals, as well as any related training, that would enhance their skill set. They can also provide suggestions on how to improve productivity.
However, that is the easy part. If the employee is performing poorly, you need to let them know, while not taking on the characteristics of Ebenezer Scrooge. Remember that if you truly desire improvement of the employee's performance, employers are advised to find a constructive way to make comments, and allow the employee an opportunity to improve in the new year, while offering assistance to do so.
Employers who find employees are not performing also have the option to terminate without cause by providing them with reasonable notice of their termination. However, doing this during the holiday period is not recommended, given that it just opens an employer up to a claim of bad faith.
Certainly, employers also have the option of terminating the employee for just cause; however, it is strongly recommended not to do so unless it has been properly documented, and the employee has ample opportunity to improve, with the assistance of the employer. In our view, a dismissal of the employee for just cause for performance reasons is rarely recommended, and certainly not during the holiday season.
Proving that an employer had just cause for performance reasons is extremely difficult to do at any time, but without taking the steps outlined above, an employer will not stand a chance of justifying the dismissal or mounting a defence to counter allegations such as harassment, or breach of human rights. The bottom line is that it is critical to document concerns and warnings given to the employee about those concerns.
Dismissing an employee during the holiday season can immediately be perceived as insensitive and may lead to extraordinary damages, particularly of a moral nature, if the employer exhibits bad faith in its manner of dismissing the employee. Dismissing an employee for performance reasons, where there are none, and asserting just cause right before the holidays is a perfect fact pattern to hold an employer liable for the damages – a horrible way to enter the season of goodwill to all.
Stuart Rudner and Natalie MacDonald are founding partners at Rudner MacDonald LLP (rudnermacdonald.com).