Canada: Trust Me - Termination Is Not Automatic For The Dishonest Employee

Last Updated: August 10 2016
Article by Michael MacLellan

Two arena operators in Kingston, Ontario were terminated by the City for time theft, and when the Union grieved on their behalf, one was reinstated even though he lied during the City's investigation into his time theft!

In Canadian Union of Public Employees, Local 109 v Kingston (City) 2016 CanLII 19081(ON LA), two arena operators, Mr. Loyst and Mr. Dervenis, were quite similar in some ways. They were both 50 years old at the time of their terminations, and were both long service employees of 18 and 16 years, respectively. Also, they both had a habit of leaving work early contrary to the specific and express instructions of their employer.

In 2015, the City received a complaint from a customer that no arena operators were able to be contacted during operating hours. The City determined that it would investigate whether its employees were engaging in time theft by overstaying breaks or leaving work early. It obtained video evidence over a 14 day period, and then held interviews with the employees.

Mr. Loyst maintained that he had never left the workplace early, nor had he seen anyone leave early or leave the workplace for breaks – which was also prohibited. Mr. Dervenis stated that he always worked a full shift unless he was instructed to go home early by a supervisor, or unless there was a family emergency.

They were lying.

Videos from the investigation revealed that each of Mr. Loyst and Mr. Dervenis routinely left work early. Mr. Loyst was observed leaving anywhere between 10-28 minutes early, and taking 80 minute long breaks. Mr. Devenis was observed leaving work early by between 15 and 52 minutes.

While the time theft was a serious matter, the City relied heavily on their dishonesty during the investigation interview in deciding to terminate each of Mr. Loyst and Mr. Dervenis.

The Union did not dispute that this conduct warranted discipline, and did not seek back pay for the grievors. However, they did ask the arbitrator to reinstate them to their employment.

At the hearing, Mr. Loyst apologized and informed the arbitrator that he loved his job and leaving early just became a habit for him. On the other hand, Mr. Dervenis stated that he was leaving early because years earlier he was informed that he could. He denied being informed that employees were not permitted to leave work early.

The Arbitrator's decision focused extensively on the issue of dishonesty. In his decision, he noted both that "there is no doubt that honesty is a foundational pillar of the employment relationship", and "that trust based offences are treated seriously by employers and arbitrators. When an employee abuses the trust placed in him or her by his or her employer, it undermines, and may destroy, the foundation of the employment relationship."

The Arbitrator noted also that the City chose not to terminate the employment of a third employee engaged in similar misconduct, for the stated reason that he was honest and forthcoming about what he did when interviewed by the employer. Given that, the Arbitrator decided that if the grievors could be trusted to come back to work with the requisite level of honesty, they ought to be reinstated.

And so, Mr. Loyst was reinstated to work. The arbitrator identified Mr. Loyst's length of seniority, relatively clean discipline record, and genuine remorse at hearing, as mitigating factors that justified reinstatement. Mr. Dervenis however, had refused to accept responsibility for his actions and showed no contrition whatsoever. The Arbitrator refused to interfere with the City's decision to terminate Mr. Dervenis for just cause.

This decision is just another in a long line of discipline cases where the central theme is the dishonesty of an employee. In cases where an employee's dishonest conduct is enough to irreparably damage the employment relationship, termination is the historically presumed outcome. But the issue of "irreparable damage" is not always clear cut.

As the City of Kingston learned in this case, two seemingly similar cases can have two very different results.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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