Canadian HR Reporter

CANADIAN HR REPORTER December 14, 2015 EMPLOYMENT LAW 5 Jeff rey Smith LeGaL VieW Alberta salesperson's pocket dial reveals moonlighting on company time Court fi nds IBM's dismissal of employee justifi ed based on company policy BY JEFFREY R. SMITH An Alberta worker is out of luck after challenging his dismissal following his employer's discovery he was performing work for his own company during busi- ness hours. D'Arcy Ross was hired by IBM Canada in 2010 to be a senior salesperson. e position was full- time with a salary plus commis- sion and benefi ts. He had access to offi ce space in Edmonton — though he was based in Toronto — but was a mobile employee who was on the road most of the time. He was provided with a company cellphone and maintained regu- lar contact with his supervisor through phone and email. When Ross was interviewed, he told IBM he was the president of a private business he co-owned with his wife. e business sold and installed custom residential storage components, and Ross was responsible for operations while his wife paid the bills. He said he had continued to run the business while he worked part- time as a salesperson for another company. However, he assured IBM that if he was hired full-time, he would transfer his responsibilities to his wife. IBM was fi ne with this ar- rangement and didn't ask Ross to sever his relationship with the private company. As part of his employment agreement, Ross had to agree to follow IBM's business conduct guidelines, which required him to avoid situations where a con- fl ict of interest could arise — for example, performing "non-IBM work or solicit(ing) such business on IBM premises or while work- ing on IBM time." e guidelines indicated that a violation could result in discipline up to and including dismissal. However, Ross wasn't satisfi ed with his work at IBM as he wasn't given his own territory or quota. In addition, IBM shifted its asset management focus to a more re- gional one instead of national. is led to his supervisor be- ing placed in Calgary instead of Toronto and he felt pressured to move to Calgary. In early 2011, Ross received a performance appraisal that described his work as needing improvement. Ross felt it wasn't a fair assessment as he couldn't work eff ectively without his own territory or quota. On Jan. 21, 2011, Ross was to have a telephone meeting — as was scheduled each week — with his supervisor. The supervisor emailed Ross a document to com- plete so they could discuss it dur- ing the meeting, but Ross failed to complete it. He then cancelled the meeting, saying he had previously scheduled an appointment at the same time. The supervisor telephoned Ross later that day and Ross said he felt somewhat overwhelmed, "like drinking from a fi re hose." A short time later on the same day, Ross accidentally "pocket- dialled" his supervisor twice. On the fi rst call, the supervisor could hear Ross having a conversation with a customer of Ross' private company. Immediately after the call ended, the second call came in and the supervisor could hear more of the conversation. It was also evident Ross was at the home of the customer. e two accidental calls lasted a com- bined three-and-a-half minutes. at same afternoon, several work emails were sent to Ross but he didn't respond to any of them. Phone records revealed he had made a call about his own busi- ness on the IBM phone. The following week, the su- pervisor called Ross to ask him if there was anything impeding Ross' commitment to his work. Ross didn't mention anything re- garding his private company. On Jan. 31, the supervisor dis- cussed the pocket dials with Ross. He sent an email to Ross outlin- ing what was heard on the phone calls and said Ross was spending up to three hours a day working for his own company. e super- visor pointed out this was a vio- lation of IBM's business conduct guidelines. In addition, IBM found out Ross had charged long-distance calls related to his own business to his IBM cellphone account and had used IBM equipment for the benefi t of his business. Ross immediately responded, saying he spent three hours per week, not per day, assisting his own company. He also claimed he tried to ensure he worked dur- ing his IBM lunch hours to avoid interfering with his IBM work. However, one week later, on Feb. 7, IBM terminated Ross' em- ployment for cause. After his termination, Ross worked for his own business full- time for two years, before joining another company. He sued IBM for wrongful dismissal. e Alberta Court of Queen's Bench found that the IBM's busi- ness conduct guidelines had no defi nition of "IBM time," but it was clear the intention of the par- ties in the contract that Ross' em- ployment would be full-time and he would "deal with other people who were working normal work- ing days." The court agreed with Ross' claim that the time spent on his own business was closer to three hours per week, not per day. is was a relatively minor breach of the guidelines, as was the brief use of IBM equipment and small amounts of money from long- distance telephone calls, said the court, which "warranted only a comment from IBM to the eff ect that this was not acceptable." Breach of guidelines wasn't isolated incident However, the court found Ross was given the opportunity to explain his "dereliction of duty" but didn't acknowledge anything was inter- fering with his ability to devote full-time hours to IBM's business. In addition, physically going to the residence of a customer of his private business on IBM time on Jan. 21, 2011, was "a major breach" of the business conduct guide- lines, said the court. e court also noted this wasn't an isolated incident — Ross ac- knowledged working three hours per week on his own business dur- ing IBM time. "Mr. Ross' own evidence pre- vents this court from concluding that Mr. Ross was, during the period in question, working full- time for IBM as he was required to do," said the court. "On the contrary, the evidence establishes that Mr. Ross was working for personal gain on IBM time." Ross discussed his private busi- ness with IBM before being hired and assured the company he would transfer responsibility to his wife. It was clear he was aware of the guidelines and that he was expected to devote all of his atten- tion during IBM business hours to his IBM work. As a result, IBM was not re- quired to give Ross a warning and an opportunity to improve his conduct, said the court. "Not only are there no miti- gating circumstances relating to Mr. Ross' misconduct, but his continuing lack of insight into IBM's entitlement to compliance with the business conduct guide- lines in their entirety establishes that Mr. Ross would be unlikely to change his attitude in the fu- ture and that it would be diffi cult for IBM to monitor any future conduct, especially in Mr. Ross' autonomous setting," said the court. e dismissal was upheld. For more information see: • Ross v. IBM Canada Ltd., 2015 Carswell Alta 1684 (Alta. Q.B.). Jeff rey R. Smith is the editor of Ca- nadian Employment Law Today. For more information, visit www.employ- mentlawtoday.com. " e evidence establishes Mr. Ross was working for personal gain on IBM time." 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