Worker showed 'clear intent to disregard his employer's instructions': lawyer
A company had just cause to terminate a worker’s employment due to his repeated time theft through inaccurate timesheets and insubordination from trying to take time off based on those time sheets, according to a British Columbia court.
The worker, 57, was hired by Solid Rock Steel Fabricating (SRSF) – a family-owned steel fabrication company in Surrey, BC – in 1992 as a draftsman. He worked for SRSF for eight years until he quit.
In 2004, the worker was laid off and SRSF’s owner asked him if he wanted to return. After some discussion, SRSF made him a verbal offer of employment with the number of hours he was expected to work over the year and a note instructing him to “keep track of extra hours” so they could reconcile whether SRSF owed him compensation or the worker owed hours to the company. It was company practice that all breaks were unpaid.
The lack of a written employment agreement isn’t uncommon, but it can leave things open to problems, says Brooke Finkelstein, an employment lawyer and workplace investigator at West Coast Workplace Law in Richmond, BC.
“Terms can be established orally or even implied through the conduct of the parties, but the absence of a written contract can create ambiguity, particularly if disputes arise later about specific entitlements,” says Finkelstein.
Timesheets included unpaid breaks
The worker periodically submitted a reconciliation of hours worked and SRSF compensated him for extra hours. However, he was including coffee breaks in his paid hours without the company’s knowledge. If he didn’t take two 15-minute breaks, he would record an extra 30 minutes worked for the day.
In August 2015, when the company wanted to implement a written employment contract. The worker negotiated a new salary and holidays with the owner, along with a “gas adjustment” because he would no longer have a gas card, on Aug. 14. The terms were put in a written agreement that was reviewed by the worker on Aug. 19, and the owner followed up and got the worker’s signature on Sept. 10. According to the worker, he “scanned it, saw it contained his raise amount, signed it, and gave it back.”
The written agreement stated the weekly hours of work and that “certain projects may require extended work hours.” It also included a termination clause allowing SRSF to terminate the worker’s employment “at any time for cause” and without cause “at any time by providing you with the minimum notice, or pay in lieu of such notice, and any severance pay required by the Employment Standards Act and no more.”
In January 2022, a new general manager was hired and he conducted a performance reivew for the worker on May 4. He asked the worker about a discrepancy of 30 minutes per day in his time reports, and the worker replied that it covered two coffee breaks per day that he didn’t take. According to the worker, the owner thanked him for the explanation. However, according to the owner, he was shocked that the worker was claiming an extra 30 minutes per day and told him that it had to stop.
The owner made a note about it immediately after the meeting and the general manager agreed that the worker was told to stop this practice.
The worker’s performance review was otherwise positive.
Time off from extra hours
On Oct. 26, 2023, SRSF approved the worker’s request to take the remaining two weeks of his vacation entitlement in early December.
On Nov. 30, the worker emailed the general manager with his calculation that he had accumulated 50 extra hours for the year. He advised that he would come into the office the next day and then take the rest of December off.
The general manager replied that the extra time off wasn’t approved and the company would pay him for the extra hours. He also reminded the worker that all breaks were unpaid.
They had a meeting about the issue and the worker said that he was going to take the time off “whether it was approved or not.”
The next day, after more back-and-forth by email, the general manager said he and the owner didn’t agree with the worker’s comments, but “if you are adamant in taking this time off in December, we will see you in the New Year.” The worker took this to be an acceptance of the time off.
Deficit in hours worked
During the worker’s absence, the general manager tried to verify the worker’s claimed extra hours with security camera footage and the worker’s expense reports for mileage. The footage only went back to October, so he analyzed Oct. 1 to Dec. 1. He discovered that the worker was still claiming paid breaks and, instead of having extra hours, the worker owed the company 28.8 hours over that period
The worker returned to work on Jan. 2 and SRSF terminated his employment for cause, citing theft and dishonesty for falsely reporting his time and “gross insubordination” for not following instructions to stop claiming payment for breaks.
The worker sued for wrongful dismissal, contesting the company’s reasons for termination, and sought damages of more than $200,000. He also argued that the 2015 written employment contract was unenforceable due to a lack of consideration for changing his existing terms of employment.
The court found the worker to be an unreliable witness, citing inconsistencies in his testimony and discrepancies between his statements and the evidence. In contrast, the court deemed the testimony of SRSF’s owner, general manager, and financial manager to be credible and consistent with the company’s documentation.
The court found that the worker wasn’t contractually entitled to paid breaks and he had improperly recorded 30 minutes per day as extra work hours. The company discovered this practice during the May 2022 performance review and management explicitly instructed him to stop, said the court.
Time theft, insubordination
Despite this directive, the worker continued recording extra time for missed breaks, leading to an overreporting of his work hours by approximately 105 in 2023 - which was time theft and insubordination, said the court.
It should have been clear to the worker that breaks were unpaid, as it was a longstanding practice at SRSF and the worker signed a written employment agreement that didn’t include paid breaks as an entitlement, says Finkelstein.
“The company directly instructed the worker to stop recording paid time for coffee breaks,” she says. “That’s a crucial factor, because at that point any perceived ambiguity was directly removed - the worker was told the practice wasn’t allowed and was expected to comply.”
The court also found that the worker was insubordinate when he informed the general manager that he would be taking the remainder of the year off with his alleged extra hours. Although the general manager denied the request, the worker proceeded with his leave, which the court said was willful and serious insubordination.
The court determined that the worker’s conduct - both the misrepresentation of work hours and the unauthorized absence - amounted to a fundamental breach of trust that justified immediate dismissal. SRSF didn’t condone the behaviour and the company wasn’t required to provide further warnings before terminating his employment, said the court in dismissing the worker’s claim for damages.
Written employment agreement
The court also found that the negotiated salary and gas adjustment for the 2015 written contract was sufficient consideration for the change in employment terms, making the contract valid.
“You want to ensure that your employment contracts are clear, comprehensive, and in writing with appropriate consideration,” says Finkelstein. “A well-drafted contract helps eliminate ambiguity, reduces the risk of disputes, and strengthens the employer's ability to enforce its terms.”
Time theft isn’t always just cause for dismissal, but it’s serious misconduct because it goes to the core of the employment relationship, adds Finkelstein.
“In this case, the time theft was deliberate and he was specifically told to stop, but he continued to do so - that showed a clear intent to disregard his employer's instructions, which constituted insubordination,” she says. “And it was repeated, so this wasn’t a one-time issue - the worker consistently and knowingly overreported his hours despite being warned.”
The case also demonstrates the importance of communicating and enforcing workplace policies consistently, according to Finkelstein.
“Not all workplace misconduct justifies dismissal, and just cause is an extremely high bar to meet,” she says. “Dismissal for cause should only be considered in cases of serious misconduct or when there is a pattern of repeated violations after clear warnings - and employers should document everything, as documentation was really critical in proving that just cause was warranted in this case.”
