Survival of Your Business is Priority
Ensuring the survival of the business is the priority for all business owners, and efficiently managing their workforce is one of the key ways to ensure the consistent growth and success of the organization. But, there can come a time when it becomes necessary to let go of an employee or partnership for the greater good of the company. While termination of contracts is never an easy process to go through, in this article by Elana Stewart, we’ll explore all the key aspects to keep in mind during this process.
Deciding When It’s Time to Let Go
Determining when it’s necessary to let go of an employee or contractor requires careful consideration of the following factors:
- Work Performance: When an employee consistently fails to meet performance expectations despite receiving appropriate training, guidance, and support, it may be necessary to let them go.
- Policy Violations: Multiple violations of company policies and code of conduct are a concrete reason to terminate contracts, as reported by Dutton Law. Not only do these violations affect the internal workings of a company, they can increase the risk of being fined by authorities as well.
- Breach of Contracts: When it comes to contractors, non-fulfillment of expectations listed in contracts is a legal ground for termination. Other valid reasons include theft of property or sensitive information, non-delivery of goods/services, consistent low-quality services, etc.
Having a legally binding contract not only protects the business from the wrongdoings of employees/contractors, but it can also be used to hold them liable for damages. For instance, contractors can be taken to court and made to be paid fines or an amount equal to the compensation lost by the business owing to their negligence or non-fulfillment of the contract.
Given the importance a contract plays in this whole process, ensure that all your agreements are vetted by lawyers and are in compliance with Canadian laws and codes.
Managing Contract Documents
Maintaining an organized employee document management system is key to ensuring legal compliance. The best way to keep documents safe and organized is to digitize them. If your business currently stores documents manually, now is the best time to switch to a document management system.
The first step will be to scan documents and save them in PDF format. For documents that are related to each other, consider merging them using a PDF merge too. Additionally, you can add password protection and encryption security for these documents to keep them safe from bad actors.
Steps to Protect Your Business
At times the termination process can become tricky and involve courts or arbitration. During this process, it is important to take the right steps to keep your business protected and ensure that those liable for damages are held accountable.
- Follow Legal Requirements: Do not try to manage proceedings alone. Always hire a lawyer or agency to represent you as they are well-versed with Canadian employment and contract law. Provide them with all information regarding the termination of the contract, your evidence for cause, and all other necessary documents.
- Maintain Confidentiality: As reported by the Office of the Privacy Commissioner of Canada, employers are only allowed to store employee information for a fixed amount of time, depending on the situation. Additionally, personal information can only be disclosed for the original purpose(s) it was collected. Hence, these records should be stored safely at all times, whether in the form of paperwork or digital storage.
- Document All Processes: When terminating a contract, always communicate in writing, whether it be through an email or a physical notice. Store the original along with all threads pertaining to the conversation, which can include details about the reason for termination, date of termination, any payments/deliverables that are pending, etc.
Poor work performance, breach of contract, and policy violations are some of the many valid reasons for contract termination of employees or contractors. To ensure that your business is protected during the process, digitize documents and use a document management system to keep them organized. Additionally, work with lawyers with expertise in Canadian contract law to receive the best representation and ensure that the termination process is smooth and executed as expected.