BC Supreme Court Comments On After-Acquired Cause

In Canada, when an employer terminates an employee without cause, the employee will presumptively be entitled to notice or payment in lieu of notice – which we commonly refer to as severance. On the other hand, an employee terminated for cause will not be entitled to any notice or severance. But what happens if, after terminating without cause, the employer discovers something the employee did during their employment that might have justified a dismissal for cause?

That's the premise of after-acquired cause—a legal argument that allows an employer to retroactively justify a dismissal without notice or severance by relying on misconduct discovered after the employee has already been let go. Employers often ask legal counsel about this possibility when new facts come to light post-termination and it can be an effective option. However, as a recent decision from the BC Supreme Court makes clear, it's a tool that must be wielded with care.