June 9, 2015

One Strike and You’re Out! – When a Single Act of Misconduct Can Get You Fired for Just Cause

In the recent case of Steel v. Coast Capital Savings Credit Union[1], the Court of Appeal of British Columbia held that a single act of dishonesty justified the summary dismissal of an employee of 21 years of unblemished service.  This case reinforces the notion that employees can be dismissed summarily (i.e. without notice or pay in lieu of notice) when acts of seemingly minor misconduct ultimately reveal an irreparable breakdown in an employment relationship.

Facts

Susan Steel was part of a helpdesk team that provided internal technical assistance to other employees of a credit union.  Her work was generally unsupervised and she was one of few people within the organization who had unfettered access to all of the documents stored electronically on the credit union’s computer system, including personal folders assigned to employees for the storage of confidential documents.  As a result, she was in a position that required the complete trust of the credit union.   The credit union provided Ms. Steel and her colleagues with a detailed policy and protocol that they were to follow when accessing personal folders.  Ultimately, Ms. Steel knew that she could only access documents in a personal folder after she received express permission to do so.

Without authorization and for her own purposes, Ms. Steel accessed the personal folder of a manager to find out where her name was on a parking priority list. She was caught when the manager was not able to access the document because it was open on Ms. Steel’s computer.  Notwithstanding her clean disciplinary history, Ms. Steel was swiftly dismissed for cause.  She sued, and a trial judge found against her.  She appealed to the Court of Appeal.

Findings

The Court upheld the trial judge’s decision and found that “[Ms. Steel’s] conduct… breached the faith inherent to the work relationship, the result of which was that the relationship had irrevocably broken down.”  In arriving at this conclusion, the Court relied on the fact that Ms. Steel occupied a position of trust in a financial sector where trust was of paramount importance. The Court held that Ms. Steel intentionally broke that trust by: (1) accessing a confidential document for her own benefit; and (2) violating the company’s clear policies by not obtaining permission to do so.

Take-Away For Employers and Employees

The Court’s decision confirmed that a single act of misconduct may justify a summary dismissal in certain circumstances.  The existence of a clear policy governing Ms. Steel’s conduct was essential to that finding.  Therefore, if an employer has a particular interest in maintaining certain standards of conduct, such as the respect of confidential information, then the employer should ensure that such standards are written in a policy that is widely circulated to employees and consistently enforced.  This is particularly important in settings where employees enjoy a significant amount of autonomy in their roles and the employer must trust them to perform their duties honestly and in good faith.

Our courts will continue to apply a contextual approach in analyzing whether acts of misconduct amount to just cause, so not every breach of a policy will support the summary dismissal of an employee.  Nevertheless, employees are best advised to adhere to policies made known to them.  Although employers face a high burden in defending just cause dismissals, in the face of even a single policy breach, Steel v. Coast Capital Savings Credit Union makes clear that the courts will not always favour the employee.

[1] 2013 BCSC 527 (CanLII), aff’d by 2015 BCCA 127 (CanLII).

LEGAL DISCLAIMER: This article is for informational purposes only and is not intended to provide legal advice, which in all circumstances must be tailored to the specific facts of any problem. You should obtain a proper legal consultation in order to determine how this article applies to your specific situation.
Please feel free to contact Israel Foulon LLP to learn more at 416-640-1550.

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