What Are the Consequences of Not Communicating Workplace Policy Clearly?

An early 2024 case has demonstrated the risk that comes with inadequate communication of workplace policies to employees.  Boyer v Callidus Capital Corp, 2024 ONSC 20 considered the employer’s policies regarding carrying over of vacation time, whether deferred bonus payments were payable if an employee was not actively employed on the date of payment, and whether stock options would continue to vest following retirement.

On each of these points, the Court held against the employer. Not only does an employer have to prove its alleged policies exist, but it must also demonstrate that they were properly communicated to the employee. This process involves providing policy documentation, ensuring the employee has clearly consented, and not communicating conflicting information on policies.

What Are the Implications for Non-Salary Remuneration Components?

While this case involved what the court found to be a resignation, proper communication of workplace policies is also vital in wrongful dismissal cases, including ones where the employer is alleging cause.

Particularly with more senior employees, much of their remuneration packages can consist of non-salary components, such as bonuses, incentive payments, and stock grants. Even where wrongful dismissal is established, litigation involves a heated battle over the quantum of damages to be paid out. Proper promulgation of policies that, for example, limit such remuneration to actively working employees, is essential to employers’ ability to limit damages owing.

Where cause can be established, an employee’s entitlements upon dismissal can be severely limited, and in some cases involving wilful misconduct that has not been condoned, they can be extinguished entirely.  Employers often depend on violations of workplace policies in establishing justification for their summary dismissals. As seen in the case above though, it is difficult to rely on these policies if employees have not been made sufficiently aware of them.

How Can Whitten & Lublin Assist Employers With Workplace Policies?

The exposure to financial liability for employers who fail to properly communicate its workplace policies can be significant. An experienced employment lawyer can assess your policies and advise on the best methods to make the most of them. If you would like more information about how Whitten & Lublin can help you navigate drafting and communication of workplace policies, please contact us online or by phone at (416) 640-2667 today.

Author – Sohrab Naderi