Alleged theft not provable in Manitoba

Missing funds pinned on employee despite inconsistent school system: Arbitrator
By Jeffrey Smith
|Canadian HR Reporter|Last Updated: 03/24/2017

A Manitoba employer didn’t have sufficient proof to justify firing an employee for theft of money that went missing under her care, an arbitrator has ruled.

Christine Dwyer was head secretary at a small Winnipeg school under the administration of the Winnipeg School Division. She had some difficulties in her position at first, but she kept meticulous notes and worked with her boss, the district business administrator, to improve. Dwyer received a positive performance assessment in March 2011.

At the beginning of the school year, the school normally collected student fees for field trips and supplies. An educational assistant and a teacher collected the money and took it to the office, where the head secretary checked the names off of a list and counted the money.

Dwyer was not supposed to collect money from parents, but rather direct them to the appropriate teachers to make their payments. Nor was she supposed to rewrite deposit amounts on the envelopes. Dwyer had no prior experience in handling money.

The school had no safe, so Dwyer kept the envelopes with money in a locked drawer. On her lunch breaks, student helpers would stay at the office desk.

In the fall of 2012, Dwyer asked the principal to lend her $400 to cover a daycare payment. The principal wrote her a cheque and Dwyer repaid her in cash the following week. It was the only time Dwyer asked to borrow money.

Missing money

In September 2012, one of the teachers received a printout of her accounts and saw that her class was credited with $475 paid. She believed the amount should have been $586. The teacher reported the discrepancy to the principal.

The district business administrator and an auditor were brought in to assess the situation, and they found undated and unsigned deposit envelopes that had been filled out by Dwyer and didn’t correspond to e-receipts.

However, they couldn’t determine whether Dwyer had taken any money, since different teachers had initially collected it and gave their envelopes separately to her.

The school division’s HR officer conducted a review and interviewed Dwyer. A total of $2,268 was unaccounted for, including $610 that Dwyer had handled and issued manual receipts for or wrote on deposit envelopes herself. Dwyer couldn’t explain the discrepancy between monies recorded as received and the actual amounts deposited, but said she didn’t know what she received and she “just wrote what she was told to write.”

Dwyer also said she didn’t fully understand what she was doing and things were a mess, but didn’t admit to taking the money.

The school division didn’t go to the police as it didn’t think it could get the money back. It also believed Dwyer stole all the money, but could only tie her directly to the $610 she handled and apparently didn’t deposit.

Some time passed and Dwyer was informed on Jan. 22, 2015, that she was being suspended without pay for six months. When she returned to work, she would be demoted to a lesser clerk position where she wouldn’t handle cash, and wouldn’t be considered for a promotion for five years, and only after completion of a basic accounting course.

The school division also required Dwyer to pay back the missing $610 linked to her.

Dwyer challenged the discipline, arguing there was no proof she was responsible for the money shortages and the system was flawed.

Unreliable system

The arbitrator found that the school division’s case was based entirely on circumstantial evidence from school records, requiring a consistency between the circumstances and alleged misconduct to effectively rule out any other conclusion.

The school division issued a six-month suspension rather than termination, despite the fact Dwyer denied stealing the money. This was somewhat odd since “a denial is usually taken as a strong indication of a lack of viability of a future ongoing employment relationship,” said the arbitrator.

It also took nearly two years for the school division to investigate and determine the discipline, which also raised questions about the school division’s certainty on Dwyer’s culpability, said the arbitrator.

Plus, the process for submitting money to Dwyer with deposit slips and envelopes was not always followed, and different people used different procedures.

Dwyer was straightforward with her answers, and although she couldn’t explain the discrepancies, she offered her best guess regarding inaccurate lists and receipts, said the arbitrator. In addition, she was overwhelmed with the financial aspects of her position.

“I agree with the union that the system was broken from the beginning and it is hard to draw conclusions from evidence presented from this type of broken system,” said the arbitrator.

The fact that Dwyer borrowed money shortly before the missing money was discovered didn’t mean much, as she paid it back the following week, found the arbitrator.

The Winnipeg School Division was ordered to rescind the suspension, remove it from Dwyer’s employment record, and reimburse her for loss of benefits and salary.

For more information see:

Winnipeg School Division and WANTE (Dwyer), Re, 2016 CarswellMan 539 (Man. Arb.).

Jeffrey R. Smith is the editor of Canadian Employment Law Today. For more information, visit www.employmentlawtoday.com.

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