Monday, 27 October 2014

When is your personal life your employer's business?

 When news broke this weekend that Jian Ghomeshi had been terminated by the CBC, a lot of people were surprised and dismayed. When the reasons for his dismissal started to leak out (in large part due to Mr. Ghomeshi's post on Facebook), surprise turned to shock and indignation. How could the CBC come to the conclusion that Mr. Ghomeshi's personal sexual habits (which are, by most accounts, entirely consensual) have any bearing on his ability to perform the role of media personality? Since when is an individual's personal life their employer's business?
A few caveats are in order: I don't know any more about Mr. Ghomeshi's situation than I've read on-line. I have no idea what information CBC had received that drove its decision, nor can I comment on the veracity of the allegations that have been levelled at him in certain quarters. And I’m not passing moral judgment, positive or negative, on any sexual activities that he may have been involved in, provided they were lawful and consensual. 
But from a purely professional angle, this situation does raise very interesting, and potentially troubling, issues of personal freedom, privacy and autonomy, and the extent to which those values intersect with the employment relationship. How far can an employer reach into the dark corners of an employee's existence to assess whether they are involved in things that are (or may be perceived) as inconsistent with the duties for which they receive a pay cheque?
In terms of the legal concepts, older cases, dating back to the 19th Century, are very clear on the issue:
“The rule of law is, that where a person has entered into the position of servant, if he does anything compatible with the due or faithful discharge of his duty to his master, the latter has a right to dismiss him. The relation of master and servant implies necessarily that the servant shall be in a position to perform his duty duly and faithfully, and if by his own act he prevents himself from doing so, the master may dismiss him. ... But if a servant is guilty of such a crime outside his service as to make it unsafe for a master to keep him in his employ, the servant may be dismissed by his master; and if the servant’s conduct is so grossly immoral that all reasonable men would say that he cannot be trusted, the master may dismiss him.”
“If a servant conducts himself in a way inconsistent with the faithful discharge of his duty in the service, it is misconduct which justifies immediate dismissal. That misconduct, according to my view, need not be misconduct in the carrying on of the service of the business. It is sufficient if it is conduct which is prejudicial or is likely to be prejudicial to the interests or to the reputation of the master, and the master will be justified, not only if he discovers it at the time, but also if he discovers it afterwards, in dismissing that servant.”
Pearce v. Foster et al. (1886), 17 Q.B.D. 536

While the language in the decision may be quaint, the underlying principle has continued to be applied by the courts, generally in cases involving alleged criminal conduct or acts involving dishonesty (fraud, theft, etc.) that occur outside the workplace. While an employer has a right to take action to defend its reputation, the courts will look to the quality of the evidence, and whether the conduct in question is truly at odds with the employer's business and/or the employee's duties. Unless the employer can establish actual or potential "prejudice" to its reputation or business, without necessarily proving any monetary loss, or that the employee was essentially disqualified from performing his or her job, then it will not have cause to dismiss the employee.
The courts have had to consider whether sexual 'impropriety', in various forms, amounts to cause for summary dismissal in a number of cases. One of the most widely publicized recent decisions was Kelly v. Linamar Corporation, in which the plaintiff was dismissed after being charged with possession of child pornography. At the time of dismissal, the employee was the materials manager for one of the company's subsidiaries. The company was a major employer in the local economy, and had a history of contributing to charities that supported youth and community programs. Although the employee had not been convicted of the offence at the time of termination, it appears that he also did not deny his culpability when questioned by the employer. The Court paid particular attention to the decision in Harrop v. Markham Stouffville Hospital, in which the dismissal of a nurse was upheld where the employer established that she had a relationship (outside of work) with a recently discharged psychiatric patient. After considering the facts and the law, the Court concluded (at paras. 30-31):
The defendant argues that an employee in the position of Philip Kelly, who is required to work with the general public both acquiring product from suppliers and supplying product to customers, who is required to manage, instruct and discipline people working under him, and who is required to interact collegially with many peers at the management level, has a duty to ensure that his conduct does not adversely impact on any of those activities. It is argued that permitting himself to be placed in the position where he would be charged with possession of child pornography, which fact became almost immediately known to his management peers, co-workers and people who reported to him, and which ultimately became known to the general public when at a later stage the identity of his employer was disclosed, he has failed to discharge the duty that he has to his employer.
I agree. Linamar has over a long period of time built up a good reputation which it jealously protects. That reputation includes the promotion of its activities with young people outlined earlier. A company is entitled to take reasonable steps to protect such a reputation and the termination of Philip Kelly was just such a step. The employer has demonstrated just cause on far more than the balance of probabilities.
Where a bank teller was involved in a common-law relationship with a man who had been charged with robbing the bank she worked for, the Federal Court of Appeal upheld the dismissal of the teller. In Canadian Imperial Bank of Commerce v. Boisvert, [1986] 2 F.C. 431, the Court considered the principles cited above in order to determine whether cohabitation with a particular person could amount to cause for dismissal. When considering the employee's duties (i.e., to safeguard the money held by the bank) and her knowledge of her fiancé's activities, the Court held that her continuing cohabitation was relevant to her employment, as her involvement with a robber had the potential to prejudice the bank's interests. Given that she had inside information about the Bank's security arrangements, her relationship with a bank robber was directly incompatible with her duties to her employer.
Where a social worker began dating a person who was convicted of a sexual offence and had been ordered to take sexual abuse counselling provided by her employer, the employer was found to have cause to terminate the employment. In Smith v. Kamloops & District Elizabeth Fry Society (1995), 9 C.C.E.L. (2d) 306 (B.C. S.C.), the employer brought its concerns to the employee, and advised her that she would have to choose between her intimate relationship and her job. When the plaintiff did not immediately end the relationship (because it was a private matter separate from her job), the employer terminated her employment citing a lack of judgment and the perception that others might have of how her involvement could impact the performance of her job and the agency's mandate. The British Columbia Supreme Court found that the employer did have cause to end her employment, taking note of the "higher degree of sensitivity and acumen" required in the plaintiff's position. Her failure to bring the issue forward or to see the potential incompatibility between her duties and her relationship reflected seriously flawed judgment, and posed significant risk for the agency's reputation.
In Reilly v. Steelcase Canada Ltd., however, an employer was found to not have cause for dismissal where an employee had an extramarital affair with the wife of a colleague. The plaintiff was a district manager, and was responsible for three of the most lucrative customer relationships of the employer. During a convention in Florida, the employee began the affair with his co-worker's wife, which then grew into a steady relationship. Surprisingly, when the co-worker learned of the affair, there was no acrimony. However, whenever the employer found out, through a complaint from one of its customers, it decided that the plaintiff's behaviour was incompatible with his role representing the company. Justice Keith of the Ontario High Court of Justice looked at the handful of decisions that had dealt with similar 'indecorous' conduct, and made the following observation about changing moral standards:
This becomes very important because between 1886, for example, when Pearce v. Foster was decided and 1918, for example, when McPherson v. City of Toronto was decided and 1979 when the present case must be decided, there has been a social revolution of enormous proportions. One need only to look at the Divorce Act, 1968 (Can.), c. 24, and the Family Law Reform Act, 1978 (Ont.), c. 2, to realize the gulf that separates current thinking with respect to personal and social relationships that are acceptable today with those that were acceptable in the society of 60 to 100 years ago.
The principles of law set out in the cases I have quoted from are indeed as sound as when they were enunciated, but when applied, they must be relevant to present society. ...
Bearing in mind the analysis in Pearce v. Foster, the Judge held that "each case must be looked at objectively, in the light of all the facts, and as related to the test of current social acceptability". The employer had acted precipitously in not investigating the matter and determining that the employee's manager was already aware and viewed the matter as a "private affair [that] would have no adverse effect on the operation of his department". Because of its failure to give the employee a chance to be heard, the employer did not have the full story before deciding to dismiss. The plaintiff also adduced evidence that two of his primary customers were very happy with his performance, and were not concerned about the adulterous relationship. In the result, the Court held that the affair did not constitute cause for dismissal as it "was neither prejudicial, nor likely to be prejudicial to the interests or to the reputation of the defendant".
In a somewhat similar case, an employee was found to have given cause for dismissal where he had a brief affair with the wife of his employer. In Olsen v. Ritchie Bros. Construction Ltd., [1994] A.J. No. 701 (AB Q.B.), the employee was dismissed after a period of 4 months after his boss learned of the relationship, during which interval he was actively at work for one month before being placed on a 3-month layoff. Given that the wife was also the company's bookkeeper, and the business was a small family-run business in a small community, Justice Hunt found that the employee's conduct was prejudicial or potentially prejudicial to the employer's operation. However, given that the employee was retained for a few months after the employer learned of the affair, the Court concluded that the employer had condoned the behaviour and could not rely on it to support termination.
In Dooley v. C.N. Weber Ltd., [1994] O.J. No. 712 (O.C.J., Gen. Div.), an executive was terminated after having consensual relationships with some of his female colleagues. After a previous incident, the employer had warned the employee that he should not have any further relationships with female subordinates, but he persisted and was dismissed. The employer did not have a written sexual harassment policy, and the Court heard evidence that there had been other instances of employees having relationships with co-workers for which they were not punished or dismissed. After reviewing and adopting the reasoning in Reilly v. Steelcase Canada Ltd., Justice Yates held that the employer did not have cause to dismiss Dooley. The Court found:
The Company failed to satisfy this onus because the order given by [the President of the Company] to Dooley was not reasonable in today's world particularly where there is no evidence before me that the Company suffered in any manner whatsoever, either financially or otherwise, arising out of the conduct of Dooley while employed at the Toronto location. In addition, the circumstances of this case clearly indicates that the order given by [the Company President] to Dooley relating to his association with women subordinates in Toronto, was not within the scope of his employment with the Company.
In the result, the action was allowed.
So what are the principles that can be distilled from the case law? Here are a few takeaways:

  • Activities by an employee outside the workplace that negatively impact the employer’s reputation in some significant or potentially significant way may be cause for summary dismissal;
  • Conduct that is criminal in nature, and which has some direct connection to the employer’s business or reputation is more likely to be cause;
  • Acts of dishonesty that reflect poorly on an employee’s integrity are likely to be cause where the performance of the employee’s job depends on trust; 
  • Where the employee is a representative of the employer’s “brand” or serves as the public faceof the business, the standards for “decorum” may be higher; and
  • Issues of so-called “moral turpitude” are subject to society’s evolving mores and ‘community standards’ in terms of whether particular actions are likely to prejudice an employer’s business or reputation. 
Where that leaves Jian Ghomeshi and the CBC remains to be seen, but the limited information that’s currently available paints a picture in shades of grey (50 shades, to be metaphorical). The CBC is a public broadcaster, with a mandate to deliver the news and other required programming throughout Canada. As a public body, it's subject (naturally) to the scrutiny of taxpayers, many of whom are not its biggest supporters.  Mr. Ghomeshi is one of the CBC's stars and regularly delivers strong ratings (albeit not on the order of Hockey Night in Canada). However, the demographic for his former program, Q with Jian Ghomeshi, has typically skewed toward folks in their 20’s. So, who’s moral values does the CBC have to consider? All Canadians? Canadians in their 20s? CBC viewers and listeners?  To what extent should Mr. Ghomeshi expect his private activities to be measured on the yardstick of communal morals and values? And what impact does the popularity of the Fifty Shades of Grey books have on this debate? Does this suggest a shift in societal judgment such that engaging in a BDSM lifestyle or practices does not meet the threshold of moral outrage necessary to constitute cause for dismissal? 
While I have my doubts that this matter will ever make it to trial (I doubt that CBC or Mr. Ghomeshi really want all of the dirty laundry aired), it could prove fascinating. If nothing else, it would provide some key insight to others whose careers are in the spotlight as to just how much of their privacy is open to scrutiny by their employers.
Do you have questions about employment law? Wonder what constitutes just cause nowadays? Contact Lance Ceaser for guidance and advice.

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