With the dawn of the MeToo movement, the seriousness of sexual misconduct in the workplace  has had a spotlight turned on it, with people being less willing to let such conduct go unpunished. However, a recent case before the Ontario Superior Court of Justice asked whether sexual misconduct at work is always a case for dismissal.

The background

The employee had been working for the employer as a senior automotive technician for close to 25 years. On the date of the incident in question, he was called into his manager’s office where he was informed that he had been seen making a “sexually explicit gesture” behind the back of a female customer. The employee was advised that if he did not admit to making the gesture, he would have to resign or be fired. He refused to do so, also refusing to resign. The employer responded by terminating him for cause, paying him five and a half weeks’ wages. The employer’s position was that the employee breached the implied duty of faithfulness and honesty when refusing to admit the gesture at the time. By the time the issue went to trial, the employee had admitted making the gesture, also acknowledging its sexual nature.

The parties agreed the case was appropriate for determination on a motion for summary judgment.

The issues

The court determined there were two issues to be considered:

1. Did the employee act in a manner that was incompatible with the employment relationship between himself and the employer?
2. If not, what is the appropriate award of damages?

Did the employee act in a manner that was incompatible with the employment relationship between himself and the employer?

The Supreme Court of Canada established the requirements for dismissal as a result of dishonesty as an essential condition of the employment contract in a 2001 decision. The key question to answer is “ whether, in the circumstances, the behaviour was such that the employment relationship could no longer viably subsist.”

The court first looked at the nature and the extent of the misconduct. In addition to the gesture itself, the court also assessed the dishonesty of the employee lying about making it in the first place.

The employee claimed that he wasn’t aware of what the manager was describing in their meeting about the gesture. After being shown a cell phone recording of a security monitor, the employee stated he was unable to see what was happening in the video, and since he couldn’t remember what the manager was referring to, he denied doing anything at all. He also testified that his manager threatened to phone his wife to detail the incident if he didn’t resign; something the manager denies.

The court determined the employee’s denial could not be characterized as persistent, writing

“First, (the employee’s) evidence is that he initially denied making the gesture because he did not know of what he was being accused.  There is no evidence that before he was shown the video on the phone, (the employee) was aware of the nature of the complaint.  Second, (the manager) admits that the recording on his phone was so poor that it was “not clear enough…to see anything.”  At that point, (the employee) said the gesture was something other than a sexually explicit gesture.  Third, (the manager) admits that when the two of them went to the mezzanine level to view the security footage, he was unable to find the incident on the video footage.  Fourth, the following day, there was no denial or even discussion about the video: (the employee) advised”

The court then turned to look at the surrounding circumstances of the incident. The employee was the most senior service technician with the employer. Up until the event in question, he had what was described as a “stellar” and “unblemished” record. Meanwhile, the employer was found to have not trained its employees around workplace violence and harassment. The court found the employer to have suffered no harm as a result of the incident

The last step of the court’s analysis on this point was about the nature, extent, and seriousness of the misconduct. The court stated “An employee’s isolated act of misconduct, including dishonesty, does not justify dismissal without notice unless the misconduct can be said to be “so grievous” that it gives rise to the inference that the employee intends no longer to be bound by the employment contract.” With that in mind, the court found “In my view, considering the limited extent and isolated nature of the incident, (the employee’s) long and unblemished record of service prior to the incident, a workplace environment that did not include written disciplinary policies and in which the employer failed to provide training to its employees on issues of harassment and workplace violence, dismissal was a disproportionate response.”

The employee was awarded 20 months of reasonable notice.

The employment law team at HMC Law helps employees and employers in all matters of employment law, including wrongful and constructive dismissal. Our clients include employers who need assistance drafting clear policies and contract language designed to avoid ambiguous situations and future litigation. We also help employees determine whether they have been wrongfully or constructively dismissed, and help them pursue damages they may be entitled to as a result. If you are an employee or an employee in need of legal advice, please contact us online or call us at 403-269-7220 to see how we can help you today.