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THE QUESTION
I was recently terminated from my employment at a tech startup because of time theft. I had been punching into work when I arrived early for my shift, up to 15 minutes early. I’ve been at the company for one year and four months. They offered me one week of severance. I believe this is a wrongful dismissal. What are the rules around time theft? Do you think my situation is enough to claim a wrongful dismissal? Could I also be renegotiating my severance?
THE FIRST ANSWER
Sophie Purnell and Andres Mikhail Villaruel, Purnell Employment Law, Calgary
Time theft refers to actions taken by an employee that result in them being paid for work they did not perform. This can include falsifying time records, taking longer breaks, arriving late, leaving early or engaging in non-work-related activities during paid hours. Company policies usually outline the rules on time theft, including how time will be monitored and the consequences.
Courts consider time theft a form of dishonesty that can undermine the core of the employment relationship. Employees who commit time theft can be terminated for “just cause”, meaning they can be fired without notice. Employers must take certain steps before terminating an employee for just cause. For example, in your case, did they investigate? Did they ask for your side of the story? Was there a clear policy on clocking in and out?
It’s difficult to say whether you have a claim for wrongful dismissal without more information. Assuming there are no grounds to fire you for cause, you are entitled to notice. The amount of notice is based on statutory and common law. In Alberta, the Employment Standards Code (“ESC”) outlines the minimum notice an employee is entitled to. In your case, under the ESC, your employer is required to provide you with one week of notice or pay in lieu of notice.
Depending on the terms of your employment contract, you may be entitled to additional notice/severance based on common law. Finally, if your employer falsely accused you of time theft without properly investigating and this conduct caused you mental distress, you could be entitled to compensation because of the employer’s breach of their duty of good faith and fair dealing in the manner of dismissal.
To fully determine if you have a case for wrongful dismissal, it would be best to consult with an employment lawyer so they can review your specific situation.
THE SECOND ANSWER
Ryan Edmonds, principal lawyer, Ryan Edmonds Workplace Counsel, Toronto
When lawyers say that just cause is the “capital punishment” of employment law, they’re not wrong. Just cause is not only an incredibly high standard, but it’s also all-or-nothing. Meaning, there’s no reduction in the termination pay owed if the conduct is bad, but not bad enough to be cause.
But here’s the twist: in Ontario, you’re still entitled to statutory termination and severance pay even if you’re guilty of just cause. This is because the Employment Standards Act, 2000 effectively creates two tiers of misconduct:
- “Wilful misconduct” is the highest possible standard, described by courts as “being bad on purpose”; and
- “Just cause”, which is still a very high standard, but is akin to “being bad, but not on purpose.”
A ruling of wilful misconduct is required to fire someone with no compensation at all, whereas an employee will still be entitled to statutory termination and severance pay if a court finds there was just cause for dismissal.
In this case, the employer has assumed that clocking in 15 minutes early was done deliberately to steal pay for work not performed. But were you actually paid for this extra time, or did you receive a flat salary? If you were paid for the time, did you also start working 15 minutes early? If not, did you leave early or cut your lunch short? Was clocking in early a common practice? Did the employer ever comment on it, one way or the other? And most importantly, did you know that what you were doing was wrong (if in fact you did improperly benefit)?
In my experience, most terminations for just cause and wilful misconduct are doomed to fail. Because each case turns on its own facts, I strongly recommend you consult an employment lawyer.
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