Canadian Employment Law Today

May 6, 2020

Focuses on human resources law from a business perspective, featuring news and cases from the courts, in-depth articles on legal trends and insights from top employment lawyers across Canada.

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Answer: "Time theft" occurs when an em- ployee receives compensation for hours that they have not actually worked. In this con- text, time theft has been treated by decision- makers as meriting discipline for the same reasons as property theft. The core element of the employment relationship is a mutual bond of trust between the employee and the employer. Decision-makers have character- ized time theft, like property theft, as direct- ly damaging that core element. Accordingly, time theft and property theft constitute an equally serious culpable act. Although time theft is a culpable act, the level of discipline that is merited is context specific and is subject to standard mitiga- tion factors, which include length of service, past disciplinary history, relevant employer policies and whether the employee showed remorse when caught. Decision-makers have upheld termination for time fraud in cir- cumstances where the only mitigating factor is length of service. Decision-makers have strictly defined what constitutes time theft. In order for a culpable action to be accurately characterized as time theft, that action must include an overtly fraudulent act. Examples of overly fraudulent acts that constitute time fraud include the al- teration of time cards, employees punching in for each other or failing to record or falsely recording attendance on an attendance man- agement system. If an intentionally fraudu- lent act is lacking, the culpable action may not be characterized by a decision-maker as con- stituting time theft. For example, decision- makers have held that, although excessive internet use for personal reasons is culpable behaviour, that usage lacks the intentionally fraudulent element and, as a result, does not constitute time fraud. As outlined above, much of the analysis regarding time fraud is context specific. Ac- cordingly, employers that are considering discipline for an incident of time theft are en- couraged to seek advice from legal counsel. Leah Schatz is a partner with MLT Aikins LLP in Saskatoon. She can be reached at (306) 975- 7144 or lschatz@mltaikins.com. Decision-makers have treated time theft as directly damaging the bond of trust between employer and employee. Answer: The standard recommendation is to give an employee at least seven days to review a termination letter and release, al- though this time frame may vary depending on the circumstances. Most importantly, an employer should never require the employee to sign a release immediately after termina- tion of the employee's employment. Such a requirement may lead to a finding that a release is unenforceable because the em- ployee felt unduly pressured to sign it, due to the power imbalance between employer and employee. However, simply because an employee chooses not to exercise the option to take the time to review a release does not mean the release is automatically unenforce- able. If the terms of a termination letter and release are fair, and the employer has offered the employee sufficient time to review them, the release and any settlement will likely be upheld. That said, best practice for employ- ers is to advise employees to take the time needed to review the documents and give ex- tensions of time limits for acceptance when asked. Where possible, employers should further advise employees that they will not accept a release signed during the termina- tion meeting or immediately after termina- tion of employment. Independent legal advice is important, but an employee's failure to seek independent legal advice is not itself fatal to the enforce- ability of a release. The key consideration is whether the employee has been given the opportunity to seek independent legal ad- vice, not whether the employee has actually exercised their right to obtain that advice. If the employee has not obtained independent legal advice, the employer should clearly ex- plain the terms of the termination letter and release, answer any questions the employee has and give the employee sufficient time to consider whether or not to sign the release. As long as the employee understands and gives informed consent to surrender legal rights, a release will likely be valid and enforceable, regardless of whether the employee actually obtained independent legal advice. 2 | May 6, 2020 May 6, 2020 Ask an Expert Have a question for our experts? Email jeffrey.smith@keymedia.com LEAH SCHATZ, MLT AIKINS LLP, SASKATOON with Leah Schatz Reviewing termination letter Question: How much time should an employer give a terminated employee to review the termination letter and release? Is there any liability if the employer knows the employee didn't seek advice before signing? Disciplining time theft Question: Can an employer treat time theft as seriously as theft of property when considering discipline? An employee's failure to seek independent legal advice is not fatal to the enforceability of a release. Employment law blog Canadian Employment Law Today invites you to check out its employment law blog, where editor Jeffrey R. Smith discusses recent cases and developments in employment law. The blog features topics such as cutting pay during the COVID-19 crisis, when accommodation is too difficult, and clarifying temporary employment. You can view the blog at www.employmentlawtoday.com. Canadian HR Reporter, 2020

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