The British Columbia Court of Appeal recently reaffirmed that when an employee is terminated "without cause", but the employer then unearths misconduct which justifies a "for cause" termination, the employer can rely on the misconduct as a full defence to a claim of wrongful dismissal.

In the case of Van den Boogaard v. Vancouver Pile Driving Ltd., 2014 BCCA 168, Vancouver Pile Driving originally terminated Mr. Van den Boogaard on a without cause basis. As part of a severance package, Vancouver Pile Driving offered Mr. Van den Boogaard four weeks' salary in exchange for a release. Following his termination, the company requested that Mr. Van den Boogaard return his company issued cellphone. When they received the phone, the company reviewed its contents and found out that Mr. Van den Boogaard had been soliciting a subordinate employee for drugs. Mr. Van den Boogaard helped develop the employer's drug and alcohol policy, was responsible for its enforcement, and was in charge of managing safety at a safety sensitive worksite. In the words of the Court of Appeal, Mr. Van den Boogaard was "expected to supervise his drug dealer in a safety sensitive workplace". 

When Mr. Van den Boogaard brought a wrongful dismissal action against Vancouver Pile Driving for damages in lieu of reasonable notice at common law, the company argued that he no longer had the right to reasonable notice or payment in lieu of notice due to his recently discovered misconduct. Mr. Van den Boogaard argued that he would not have been dismissed had the company found out about the texts during the course of his employment. The British Columbia Supreme Court and Court of Appeal disagreed, finding that the solicitation of drugs from a subordinate in the circumstances went to the root of the employment relationship and justified termination for cause, regardless of when it was discovered.

It is important for employer's to remember that after-acquired cause arguments are typically successful only in situations where the employer had no knowledge of the misconduct at the time of the termination. If Vancouver Pile Driving had been aware of Mr. Van den Boogaard's behavior when they terminated him without cause, they may not have been able to rely on the evidence of his misconduct when faced with a wrongful dismissal claim.

The case provides several important reminders for employers:

  • While it is standard practice to have employees return company issued devices on termination of employment, consider whether it may be appropriate to:
    • review the contents of the device.  There may be relevant records and important to determine any unknown issues or liabilities. 
    • properly secure the information contained on the device (for privacy and confidentiality).
  • Employers should ensure their policies reflect the nature of access and review the employer would like to have over the device and information on it in the case of an investigation or review.  Use policies should include warnings regarding discipline and termination for violations and be acknowledged by employees.
  • Beware of the prospect that an employer's knowledge of misconduct at the time of termination may be viewed by a Court as condoning the behavior if the employer does not act on it.
  • Evidence of after-acquired cause can be used.  After discovery of it, an employer may be able to revise its position on cause.

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