Asserting and establishing just cause when faced with an action
of wrongful dismissal is a difficult and often unsuccessful avenue
for employers. Establishing an employee has committed acts or
omitted to perform the responsibilities of their position therefore
disentitling them to common law reasonable notice is a high burden.
The height of the legal burden will differ depending on the type of
cause asserted, but it remains an uphill battle for employers
regardless of whether the cause is framed as insubordination,
theft, fraud or a combination of issues.
A decision from the Court of Queen's Bench of Alberta
provides a useful illustration of how cumulative improper acts can
amount to just cause. The decision, Molloy v. EPCOR Utilities
Inc. involved an employee that was dismissed in 2009
following an investigation into complaints of breaches of the
employer's Ethics and Respectful Workplace Policies and
improper conduct with another utility company.
The employee, Ms. Molloy, had worked for the City of Edmonton
since 1978 and her position evolved considerably over the course of
her tenure. In 1992 Ms. Molloy began working for what would later
become EPCOR, an electrical utility owned by the City of Edmonton
but providing their services throughout North America. In 2006 Ms.
Molloy was promoted to Director of Public Consultations and
Community Relations. The new position offered greater compensation
and increased responsibilities including a new joint venture with
another utility company, AltaLink. It was Ms. Molloy's conduct
throughout this project that would lead to an investigation and her
eventual dismissal for cause in 2009.
The project involved a massive public consultation, involving
2500 stakeholders and the importance of positive relations with
AltaLink was paramount. However, over the course of the project Ms.
Molloy was alleged to create a hostile working environment between
the two companies. The allegations described Ms. Molloy as
expressing a negative attitude, bordering on hostile, towards
AltaLink employees. These concerns were raised with Ms. Molloy
without the use of formal discipline, but Ms. Molloy's role in
the project was altered. Around the same time, an informal
complaint was lodged by two employees alleging poor leadership and
unethical conduct exhibited by Ms. Molloy.
An investigation into the complaint revealed 5 points of
misconduct that led to the dismissal of Ms. Molloy:
1. Failing to disclose the conflict of interest arising from her
husband being hired as a consultant on the project;
2. Directing subordinates to destroy an email in an attempt to
conceal information from AltaLink;
3. Conducting herself with EPCOR and AltaLink staff in a
disrespectful manner amounting to workplace harassment;
4. Using EPCOR's time and resources inappropriately for her
personal benefit; and
5. Obtaining reimbursement for a personal dinner out with her
husband which she improperly characterized as a business
The investigation involved interviewing several employees
including Ms. Molloy and it was concluded that each of the five
allegations were substantiated. Ms. Molloy was subsequently
terminated and she launched a claim of wrongful dismissal seeking
24-months of pay in lieu of notice as well as aggravated and
In a positive decision for employers, JusticeJ.E. Topolniski
found that EPCOR had just cause to dismiss Ms. Molloy. While the
incidents on an individual basis may not amount to just cause,
their cumulative effect was enough to disentitle her to common law
reasonable notice. This finding is especially unique considering
that Ms. Molloy had worked with the City since 1978 and EPCOR since
1992, had a clean disciplinary history, was 60 years of age at the
time of dismissal, and held a very senior management position. On
the other hand, someone with her position and responsibility is
expected to uphold company policy and the breach of ethics (i.e.
destroying documents) was seen as incompatible with the fundamental
terms of the employment relationship. At paragraph 210 Justice
Topolniski states that "[e]mployers are entitled to hold high
expectations regarding the trustworthiness of their senior or
Removing senior employees, or any employees for that matter, for
cause is a difficult position for employers to establish especially
without a single serious incident of misconduct. However, cases
like these show that employers can be successful when a number of
incidents have a serious cumulative negative effect on the
business. This case also demonstrates that taking the time to
conduct a thorough investigation rather than making a snap decision
to terminate will place an employee in a better position to defend
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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