Canadian HR Reporter

www.hrreporter.com 23 C O L U M N S E M P L O Y M E N T L AW THEFT, DISHONESTY SPOIL SALES REP'S EMPLOYMENT Manitoba court has upheld the firing of a dairy company employee for stealing product, even though the company didn't conduct its own investigation into the misconduct. Patrick McCallum, 47, was a sales representative for Saputo Dairy Products, a Montreal-based producer of dairy-based foods, since 2002. He sold cheese products to grocery stores in Winnipeg as well as rural areas of Manitoba and northwest Ontario. During store visits, McCallum checked the cheese in stock and removed any that he deemed unsaleable. If the reason was a quality control issue originating with Saputo, he gave the store a credit. Saputo had no written policies on issuing credits or disposing of unsaleable units, but it had a policy with Loblaws requiring a monthly cheese credit form to be signed by the store manager. On Aug. 21, 2015, McCallum visited a Loblaws Superstore in Winnipeg. He formally signed in and obtained a visitor badge before going to the dairy section. McCallum noticed that some packages of Saputo cheese were discoloured and soft, so he removed them and examined them to determine which ones warranted credit. After getting a store employee's approval of the units to be credited, McCallum couldn't find the employee with the key to the "wet compactor" — a device used to destroy packaging containing moist or liquid substances. He decided to take the units home to dispose of them — which was not his normal practice. He put the units into a milk crate and signed out of the store. However, after McCallum loaded the units into his car, a store security officer and the assistant manager arrived and examined the units in his trunk. They asked him to come back into the store while they investigated. They discovered that McCallum had taken a unit of another brand and the assistant store manager also felt that the units McCallum had removed were "perfectly saleable." A couple of days later, McCallum apologized to the store manager for the mix-up and said that he hoped they could "fix this and move on" without telling his supervisor. However, the store manager said it was now a loss prevention matter. McCallum told his supervisor that he had made a mistake and he hadn't intended to steal cheese. When asked why he had removed cheese without proper paperwork, he responded that he was tired after a long day of driving and in a rush to get to a party raising funds for a wedding. According to the supervisor, McCallum mentioned he had intended to bring the cheese as a gift to the party, but Saputo's donation policy required authorization. He also didn't mention that he had taken a unit of another brand. Termination leads to wrongful dismissal claim On Sept. 1, Saputo terminated McCallum's employment. He claimed wrongful dismissal, saying Saputo should have conducted its own investigation, it arbitrarily enforced unwritten policies and it unfairly held him to a standard of perfection. He argued that it was "a simple mistake that any Saputo employee might have made." The Manitoba Court of Queen's Bench disagreed that the incident was a mistake. McCallum had 13 years of experience with cheese sales, so he was familiar with the processes and paperwork required for the removal of unsaleable product. The fact that he volunteered to dispose of spoiled units on that particular day, contrary to established procedure, made it "more likely than not that [McCallum] took the cheese for his own benefit," said the court. The court also found that McCallum wasn't honest with his supervisor, failing to mention he had taken a unit of another brand and trying to explain it away. If McCallum was tired and rushed, it would have made more sense to leave the cheese to be destroyed at the store, said the court. The court determined that, although Saputo didn't consistently enforce its policies and didn't conduct its own investigation, that didn't change the seriousness of McCallum's misconduct. His dishonesty and the information Saputo had from the store's manager and assistant manager were sufficient evidence to prove just cause for dismissal. "Saputo did not owe [McCallum] a duty to investigate," said the court. "It had a duty to treat him fairly and honestly based on the information that it had at hand on the day it terminated his employment and I find that it fulfilled that duty." For more information, see: Shehata v. Ashton College Ltd., 2020 BCPC 37 (B.C. Prov. Ct.). CHRR Employers usually have a duty to investigate misconduct before issuing discipline. However, a Manitoba company didn't need to investigate when it had enough information from other sources to prove just cause for dismissal, writes Jeffrey R. Smith HOW IS OCCUPATIONAL FRAUD OR THEFT USUALLY DETECTED? Jeffrey Smith Editor of Canadian Employment Law Today Source: Association of Certified Fraud Examiners The worker's dishonesty and the information the employer had from the store's manager and assistant manager was sufficient evidence to prove just cause for dismissal. A 13% management reviews 7% by accident 40% tips 15% internal audits

• Cover