Canadian Employment Law Today

August 11, 2021

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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Canadian HR Reporter, 2021 Canadian Employment Law Today Canadian Employment Law Today | | 7 More Cases More Cases increase their probability of earning cryptocur- rency and distributes the rewards based on the account's contribution to the pool effort — one account with full access and a monitoring account to observe the activities of its client miners to see if any weren't operating. Zhang managed the Antpool accounts. The president gave Zhang the title of vice- president of MiningSky so he could look after the technical side of the company's operations. Zhang and the other vice-president were given free reign within their areas of expertise and weren't watched closely. Zhang, along with other employees, also earned commissions for bringing business to the company. MiningSky set up a digital wallet to hold cryptocurrency, but it wasn't set up properly and nothing was ever put into it. Dismissed due to shortage of work In December 2018, MiningSky terminated the employment of several people, including Zhang, due to a shortage of work. The compa - ny gave him a termination letter on Dec. 5 that stated his employment end date was Dec. 20. Zhang asked about a commission he was owed on a transaction, but MiningSky said it couldn't pay him yet because the project hadn't been finished and full payment hadn't been received from the client. On Dec. 11, the president asked Zhang to send the login information for the company's website manager and Zhang sent a list of all his passwords from his time with Vling to the present. However, when the president tried to login to Antpool, he was asked for a code that had been sent to a particular cellphone. The president assumed it was Zhang's cellphone. The next day, he asked the company's network administrator to get information related to MiningSky's e-currency accounts, and the ad - ministrator told him the links were to Zhang's own personal digital wallet. Zhang filed an employment standards com- plaint and on Dec. 19, MiningSky was ordered to pay the outstanding commission. According to the president, on Zhang's last day of employment with MiningSky, he told Zhang about the faulty Antpool password and he wanted the information to retrieve the com - pany's digital currency, but Zhang refused until he received his commission. This standoff con- tinued into January 2019. In late February 2019, the president discov- ered that MiningSky's cryptocurrency was no longer in its digital wallet. An internet search of transactions showed that it had been re- moved on various different dates over the course of that month. The identity of the re- cipients wasn't searchable. The president didn't ask any other employ- ees if they had the missing digital wallet be- cause he was "99.9 per cent certain" that Zhang had taken it. He emailed a Vancouver police officer about the missing cryptocurrency — he didn't mention Zhang's apparent threat about the commission — but he didn't receive a re - ply. He didn't follow up until four months later, as he was busy. The president also hadn't told the CFO of any cryptocurrency accounts, so she was sur- prised to learn about the missing digital wallet and cryptocurrency. MiningSky brought an action against Zhang for theft of company property and breach of his employment contract. It claimed that the missing cryptocurrency was worth about $84,000. Zhang denied taking any company property and said that in November 2018 he had been asked to move all mining income from the company's own miners to a digital wallet address, of which two recipients were associated with the company president. He also denied performing any of the February 2019 transactions, saying they could only have been carried out by the owner of the private key for the destination wallet in the transac - tions. He believed that the president per- formed the transactions. Zhang also claimed that MiningSky had still not paid him the amount owned to him for commission, but he denied threatening to withhold company property until he was paid. The court found Zhang to be credible, as he was forthright and careful to explain things. MiningSky's president, however, was less so as he seemed not to be too concerned about the missing cryptocurrency. He never told the CFO about the accounts, other employees and executives were unaware of the amount miss - ing, he didn't follow up with the police officer he emailed, and he gave the impression that he was too busy to prioritize retrieval efforts. In addition, the company's digital wallet wasn't set up properly in the first place but nothing was done to correct that, said the court. The court also found that the president never considered the possibility that someone else took the cryptocurrency, despite the lax handling of the accounts, and the credibility issue made it difficult to conclude that Zhang "bluntly refused to hand over company prop - erty and information until MiningSky paid his outstanding commission," particularly since the president never mentioned it when he re- ported the theft to the police. "I accept that the outstanding commission owed to [Zhang] might have provided him with a motive to steal the cryptocurrency, but a similar motive could also be attributed to other employees of MiningSky who had access to the necessary information and who wanted to take advantage of MiningSky's poor inter - nal controls," said the court in noting that the case against Zhang was "circumstantial." The court determined that MiningSky failed to prove that Zhang took and subsequently withheld information or devices necessary to access the company's cryptocurrency and dis - missed the company's claim. For more information, see: • MiningSky Technology Ltd. v. Zhang, 2021 BCSC 198 (B.C. S.C.). Company's digital wallet never set up properly or used « from B.C. EMPLOYER'S on page 1 The president hadn't told the CFO of any cryptocurrency accounts, so the CFO was surprised to learn about the missing cryptocurrency. leave within 10 or 12 months of earning it, or four months in the case of New Brunswick and Nova Scotia. Therefore, if the employee's vaca- tion corresponded with the deadline for them to take their annual vacation, the employer would violate these provisions if it called the employee back to work. Alberta, Manitoba, and Newfoundland and Labrador require employers to try to mutually agree upon vacation dates with an employee be - fore unilaterally scheduling the vacation. This obligation is applicable to rescheduling vaca- tion as well. Most jurisdictions also require the employer to provide notice of an employee's vacation dates. Apart from B.C. and the three territories, all other jurisdictions explicitly mandate the em - ployer to provide a specified amount of notice before scheduling an employee's vacation dates. Therefore, any changes to an established vaca- tion will have to comply with the relevant no- tice requirements. Employers should also consider any relevant provisions in their employment contracts or collective agreements before rescheduling or cancelling an employee's vacation. For more information, see: • Watson v. Summar Foods Ltd., 2006 CanLII 38233 (Ont. S.C.J.). Colin Gibson is a partner with Harris and Com- pany in Vancouver. He can be reached at (604) 891-2212 or « from FROM ASK AN EXPERT on page 2 Notice required

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