When Harbour Ridge Construction Ltd. terminated its 54-year-old site superintendent in March 2023 after 11 years of service, the company's management believed they had sufficient grounds to end the employment relationship without providing substantial notice or pay in lieu thereof. The superintendent had been involved in several workplace conflicts during the preceding months, and senior management recalled verbal discussions about performance concerns dating back at least 2 years. Yet when the company's insurer requested documentation to assess the wrongful dismissal exposure arising from the terminated employee's demand letter, the personnel file revealed critical gaps that transformed what management considered a defensible termination into a matter carrying significant financial risk. The file contained no written performance reviews from the past 4 years, no contemporaneous records of the alleged performance conversations, no formal warnings, and no documentation of the specific incidents that purportedly justified termination. This lesson examines how claims professionals and employment practitioners assess wrongful dismissal exposure when the documentary record is incomplete, applying the legal framework that governs such assessments in Newfoundland and Labrador.
The distinction between termination with cause and termination without cause carries profound financial consequences that documentation failures can dramatically shift. Under Newfoundland and Labrador law, an employer may terminate an employee at any time without cause provided the employer gives reasonable notice or pay in lieu thereof, with the notice period calculated according to factors established through common law principles. When an employer asserts cause for termination, the employer bears the burden of proving that the employee engaged in conduct sufficiently serious to warrant immediate dismissal without notice or compensation. The standard for establishing just cause is demanding, requiring the employer to demonstrate conduct that fundamentally breaches the employment relationship in a manner that makes continued employment untenable. Documentation serves as the evidentiary foundation upon which this burden is discharged, and when records are incomplete, the employer's ability to meet this burden diminishes substantially regardless of what actually occurred in the workplace.