Canadian Employment Law Today

Dismissal of whistleblower upheld after ultimatum Employer showed encouragement and gratitude to employee for revealing financial mismanagement, but employee took things too far with demands and refusal to work BY JEFFREY R. SMITH A Manitoba worker's termination of employment was the result of her issuing an ultimatum and walking off the job, not a reprisal for reporting accounting irregularities with her employer, the Manitoba Labour Board has ruled. Stradbrook Residential Services was a provider of life skills support and training for people with emotional and physical dis - abilities in Winnipeg for 40 years before it closed in March 2018. In June 2017, Strad- brook hired a worker, referred to as L.C., to perform accounting and bookkeeping duties on a part-time basis. L.C.'s work in- cluded payroll, billing, and rent top-ups for clients and it was agreed when she was hired that she would work six to eight hours per week. Soon after she started employment with Stradbrook, L.C. discovered accounting ir - regularities and questionable management practices. She reported her concerns to Stradbrook's executive director, who recog- nized that some of the same problems had been found during financial statements for the period ending March 31, 2017. e ex- ecutive director agreed to give L.C. more hours of work to fix things and ensure Strad- brook was operating according to Generally Accepted Accounting Practices. As a result, L.C. began working 25 to 30 hours per week. In September, Stradbrook's financial statements were audited by an independent accountancy firm, which was a requirement to receive government funding. e firm in - formed the president of the board of direc- tors that there were irregularities and other problems and made recommendations for improved controls over its finances. At the annual meeting, the board of di - rectors expressed concern of "apparent deficiencies in management." ere was also some questioning of the amount of hours L.C. was working on assignments that weren't part of the internal function she had been initially hired to perform. e board stipulated that L.C. should work eight hours per week going forward, "unless there was some good explanation as to why the functions could not be performed in that amount of time." e president of the board of directors met with the executive director and another board decided to ask one of the supervisors if she could take on the accounting work normally done by L.C. in order to streamline operations and help with Stradbrook's finan - cial problems. e supervisor in question wasn't comfortable handling financial mat- ters and refused. ey asked another super- visor but the second supervisor also refused. In response to the concerns raised at the annual meeting, L.C. reduced her hours to previous levels, putting in between six and eight hours. However, she continued to have concerns about improper billing, bo - nuses, missed funding opportunities, and low wages paid to staff. On Oct. 19, L.C. emailed a letter to the president of the board of directors stating she wanted to give him an opportunity to address her accounting concerns before she reported them to the Agency Accountabil - ity and Support Unit of Manitoba Families (AASU). She criticized the executive direc- tor and suggested the two supervisors who had been asked about accounting duties were both capable of running things with- out the executive director's presence if the board supported them. She also said she was willing to resume additional hours and work to reconcile the financial records. e president of the board of directors felt L.C.'s comments reinforced the board's concerns about the executive director and, after meeting with him, decided he shouldn't continue in that role. One of the supervisors was appointed to be the new executive director and confirmed that L.C. could perform the accounting functions "approximately one day per week." e new executive director — who had been one of the supervisors asked to take over L.C.'s duties — told L.C. about the re - quest. L.C. was shocked and thought it had been an attempt to terminate her as a repri- sal for her disclosure of alleged wrongdoing in Stradbrook's financial matters. She said she felt that Stradbrook was only going to keep her around until she fixed the account - ing problems and then fire her. e presi- dent of the board of directors sent her an email thanking her for bringing the finan- cial matters to the board's attention and he hoped she could continue in her role sup- porting payroll, billing, and rent top-up. Worker issued ultimatum However, L.C. still didn't feel confident Stradbrook still wanted to employ her on an ongoing basis and told the president of the board of directors that she would "not continue on" unless the board of directors met with her, explained "its at- tempt to terminate" her, and included her in discussions that affected the account- ing department. She specified that she wasn't quitting but instead was "suspend- ing my duties" until her demands were met and the AASU clarified if it would be proceeding with investigating the ac- counting irregularities. L.C. also told the new executive director that she couldn't "clean anything up work- ing one day a week," so the board of direc- tors must not be interested in clearing up the financial problems. She said she would be in Oct. 30 to complete the payroll, but wasn't interested in returning after that. L.C. reported for work on Oct. 30, com - pleted the payroll including her own pay for the next pay period. She walked around saying goodbye to co-workers and when a few asked if she had quit, she said that it ap - peared so. L.C. sent an email to the execu- tive director saying she had enjoyed work- ing with her and wishing her success. She also offered support in the board's situation with the AASU. She left and didn't return to work after that day. Stradbrook issued a record of employ - ment two weeks later indicated that L.C. had quit. She contacted the new executive 4 Canadian HR Reporter, a Thomson Reuters business 2019 CASE IN POINT: JUST CAUSE WHISTLEBLOWERS ARE getting more protection as jurisdictions realize the importance of getting the truth about businesses and organizations that could affect the public interest. This protection allows those with knowledge of wrongdoing to come forward without fear of reprisals. Having it in place is a good thing for getting to the truth, but it's also not meant to give employees power over their employers and freedom from just-cause dismissal. BACKGROUND

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