Sustainable Employment Contracts: Clear, Transparent, and Collaborative

We’ve written elsewhere about the importance of employers creating Sustainable Employment™ relationships with their employees, by which we mean relationships that are lasting, beneficial, and meaningful for everyone involved. As nice as that sounds, though, what does this look like in practice?

To help translate theory into reality, we’re always on the lookout for real-life examples of both sustainable and nonsustainable employment practices, in the media, in the courts and in the work we do.

A recent case out of the BC Supreme Court illustrates “what not to do” when it comes to contracting with your employees, not just from a Sustainable Employment™ perspective, but also from a legal and financial one.

Cheong v. Grand Pacific Travel & Trade involved a failed attempt by an employer to rely on the provision in a staff handbook to limit the amount of severance it paid to a dismissed employee. Relying on the handbook, the employer paid Ms. Cheong two weeks’ severance when it fired her (after a briefly interrupted 13 year period of employment).

Ms. Cheong sued for wrongful dismissal and the judge found that the handbook had no legal force regarding the terms of her employment and awarded her damages equal to 14 months’ salary.

Cheong is a sobering reminder to employers of the importance of taking a transparent, clear, mutually beneficial and collaborative approach to contracting with your employees – and what can happen when you don’t.

In our experience, these qualities are key to a successful, Sustainable Employment™ relationship. Unfortunately, when Ms. Cheong’s employer introduced a termination provision in its staff handbook, these qualities were notably absent. The provision was one-sided and unilaterally imposed by the employer, and ambiguous in terms of its legal effect. By not making sure that Ms. Cheong fully understood, accepted, and benefitted in some way from the introduction of this provision, GP not only failed to achieve its workplace objectives, it exposed itself to significant legal liability.

For a copy of our Sustainable Employment™ Guidelines for Contracting with Your Employees, click here.

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