Howling At The Moon-Lighting Employee

Employer justified in terminating employee's employment for cause after discovering misconduct through an accidental phone-call (a pocket dial!)

In the recent decision of Ross v IBM Canada Limited, 2015 ABQB 563, the Alberta Court of Queen's Bench upheld the termination of employment with respect to an employee who was caught working for his personal business on company time. The Court held that the employee's actions in the particular circumstances of the case amounted to a serious and repeated breach of the company's guidelines, and that the employer was justified in summarily dismissing the employee as a result.

The facts of the case are unusual to say the least. D'Arcy Ross was hired by IBM as a full-time senior salesperson with a substantial annual salary. Due to the nature of his position, Ross spent the majority of his work days away from the office and was considered for the most part to be a 'mobile' and autonomous employee. During the hiring process, Ross informed IBM that he was the president and co-owner of a personal business, but assured his future employer that he would transfer his operational activities for that business to his wife upon starting work at IBM. It was a condition of Ross's employment that he understand and abide by IBM's conduct guidelines, which had, among other things, clear restrictions with respect to using IBM assets and performing non-IBM work on company time.

As you may have guessed, Mr. Ross continued to work for his personal business after being hired and without informing IBM that he was doing so. On an ill-fated day in January, Ross cancelled a weekly telephone meeting with his supervisor due to 'double-booking another appointment'. Little did Ross know that on that same afternoon, he twice 'pocket dialed' his supervisor, who in turn overheard Ross conducting work for his personal business. Ross later admitted that he was still doing work for his business, albeit for a limited number of hours per week. Days later, his employment was terminated for cause.

Before starting its analysis, the Court reiterated the test for what constitutes just cause. Whether an employer has just cause to terminate an employee's employment will depend on the particular facts and circumstances of the case, and the court must consider the nature and seriousness of the misconduct in order to assess whether the employment relationship can continue. If the misconduct goes to the very core of the employment relationship, it...