Canadian Employment Law Today

with Tim Mitchell Ask an Expert NORTON ROSE FULBRIGHT CALGARY Have a question for our experts? Email Have a question for our experts? Email Jeffrey.R.Smith@thomsonreuters.com Jeffrey.R.Smith@thomsonreuters.com Canadian HR Reporter, a Thomson Reuters business 2014 2 | | April 30, 2014 April 30, 2014 Answer: e investigation of employee misconduct is often given short shrift in fa- vour of a quick resolution. e loose ends and unexamined conclusions that some- times result from this approach can come back to haunt an employer who leaps too quickly to judgment. A non-existent or perfunctory investiga- tion can lead to reinstatement of a dismissed employee or to an award of compensatory or punitive damages and may also have broader implications. In a recent case, the Ontario Labour Re- lations Board relied primarily on a severely fl awed investigation into an alleged incident of elder abuse to conclude the employer had an ulterior motive in terminating the em- ployee. In Ontario Public Service Employees Union v. Heritage Heights Retirement Home Inc., the employer's failure to provide the employee with particulars of the allegations and an opportunity to tell his side of the story, as well as its failure to follow its own policy allowing it to suspend an employee during an investigation into his conduct, undermined its case. Instead, it was inferred that it was the employee's union organizing activities that led to the termination. No single standard Precisely what is required of an investiga- tion in each case will be determined by a variety of factors. ere is no single stan- dard unless, as in the Heritage Heights case, the employer has agreed to or unilaterally implemented policies that govern all or par- ticular allegations of misconduct. Many em- ployers have established policies for dealing with sensitive areas such as substance abuse or harassment. In a unionized environment, disciplinary procedures are often dictated by a collective agreement and this may en- title an employee to certain protections dur- ing the investigation. A common one is the right of an accused employee to have a union steward present when being questioned. Accordingly, the fi rst step in any investi- gation should be to determine if there is an existing contractual obligation, procedure or policy governing the matter and, if so, what it dictates in terms of procedural steps. It should be followed carefully in relation to any suspected misconduct falling within its scope. Adjudicators have little sympathy for employers who have identifi ed best prac- tices in theory but fail to comply in practice. Apart from this type of obligation, a prop- er and eff ective investigation is one that is impartial, fair and thorough, having regard to the context in which it is conducted. e nature of alleged misconduct and the consequences to the employee of the con- templated discipline will aff ect the required scope of an investigation. In cases of serious misconduct where an employee's future employment or career is on the line, particular care may be required. is was noted in Interior Health Authority v. British Columbia Nurses' Union, where the arbitrator stated: "More than a minimum of due process is required when an employee's security in that respect may squarely depend on the outcome of the investigation, and a height- ened responsibility in such situations ex- tends to the employer to ensure that a suf- fi cient standard of procedural integrity is attained. To ignore this precondition to the assessment of discipline would undermine a substantive employee right, in some ex- treme circumstances justifying the voiding of the disciplinary measure… regardless of the merits of the employer's case." Impartiality critical Impartiality is an important feature of any investigation. is requirement is often honoured in the breach as investigators set out to gather evidence to substantiate alle- gations, rather than taking an objective ap- proach to fact-fi nding. At its most extreme, the appearance of bias on the part of an in- vestigator may lead to an allegation of bad faith in the manner of dismissal that may be compensable in damages. e scope and existence of a duty of fair- ness in carrying out an investigation is more nebulous. e common law has never ob- ligated a private employer making a deci- sion on dismissal to provide a fair hearing to the employee or to otherwise take fairness into account: Leach v. Canadian Blood Ser- vices and van Woerkens v. Marriott Hotels of Canada Ltd. However, while no claim can be made by an employee the dismissal itself was unfair, unfairness in the process can also be indicative of bad faith. In Clarke v. Syncrude, the dismissed em- ployee claimed bad faith when he was de- nied access to witness statements given to the employer during the course of an inves- tigation of sexual harassment allegations. e court rejected the claim, noting the em- ployee had been advised of the substance of the complaints in suffi cient detail to allow him to respond and was not entitled to the statements themselves. Bad faith was found in Elgert v. Home Hardware Stores Limited, resulting in puni- tive damages of $75,000. e employer con- duct that justifi ed the award related, in large part, to the investigation into allegations of sexual harassment against the employee: inexperienced and biased investigators; predetermining the outcome of the investi- gation; providing no information on the al- legations to the employee; refusing to hear his side of the story; and failing to consider the possibility the allegations were untrue. e Alberta Court of Appeal in Elgert pointed out there was no specifi c stan- dard of investigation employers must fol- low. What was required varied, depending on the facts surrounding the employer, its policies, sophistication, experience and the workplace. It also noted courts should not require such a high standard of investiga- tion that it would have a chilling eff ect on employers' manner of dealing with allega- tions of sexual harassment. at said, the employer's investigation in the case before it fell well below an acceptable standard. ere was a similar result in Vernon v. Brit- ish Columbia (Liquor Distribution Branch), where an employee was awarded substantial damages for wrongful dismissal after being terminated on the basis of a seriously fl awed investigation. e employee began working for the defendant employer as a clerk at age 19. She was a senior store manager when she was terminated for cause some 30 years later, after the employer received a written complaint alleging a pattern of bullying, ha- rassment and intimidation of subordinates. In the ensuing wrongful dismissal action, the trial judge found that, while the employ- er did have an obligation to investigate the complaint, the investigation was adversarial and unfair and resulted in a factually inac- curate report. e employee was given no real opportunity to deal with the allegations in the complaint and no opportunity at all to deal with the allegations made in interviews of other employees. A thorough and fair investigation would have revealed some room for improvement in the employee's management techniques that could have been rectifi ed with assis- tance from the employer. It would not have revealed grounds for summary dismissal. Accordingly, the employer was found liable for damages for wrongful dismissal and ag- gravated damages for conduct in the course of dismissal that was unfair and unduly in- sensitive, causing mental distress over and above the normal distress and hurt feelings resulting from the dismissal itself. e cases suggest a minimal standard of ASK AN EXPERT on page 6 » Workplace investigations QUESTION: What are the minimum best practices and legal requirements for employers in conducting investigations into employee misconduct before issuing discipline?

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