Asserting Just Cause In Good Faith Not Grounds For Voiding Without Cause Termination Provisions

Employers who discover that an employee has engaged in serious misconduct are faced with a difficult decision: should they attempt to terminate the employee for "just cause" in which case the employee would not be entitled to any notice or pay in lieu of notice? Or should they terminate on a "without cause" basis and seek to rely upon a termination provision limiting the employee's termination entitlements?

The risks are significant as an employer who asserts just cause without an honest or good faith belief can be found liable for additional damages as well as potentially voiding an otherwise valid without cause termination provision. This could result in an employer being found liable for a much greater amount than had it proceeded to terminate on a without cause basis.