Company accused worker of theft and fraud, but was more worried about gaming licence than investigating the facts of the matter
Employers have an obligation to investigate employee misconduct before deciding on a course of action. However, one employer was so worried about being guilty by association, it didn’t bother to investigate whether the employee was actually guilty.
In Ontario company’s quick trigger on firing an employee was a knee-jerk reaction that was an attempt to distance itself from an incorrect perception of the employee than any real cause for dismissal, the Ontario Superior Court of Justice has ruled.
JBC Coach Lines is a tour operator that runs coach tours to various attractions and trips to casinos. Travellers Auto Cars Limited runs a garage where cars and buses are repaired, which is owned by the same individual as JBC, Danny Leung, and shares offices with the tour company. JBC buses park at the garage and are repaired in the Travellers facility.
In 2013, JBC hired David Dang as a bus driver. Dang eventually was promoted to an office manager position that involved scheduling tours, paperwork, tracking driver hours, and ensuring the company ran smoothly. He also performed some minor work on JBC’s buses such as changing light bulbs, changing oil, and checking the air conditioners. He also performed some tasks for Travellers, though his paycheque came from JBC.
Dang officially worked 40 hours per week, but the reality was that he worked more than that — usually 7 a.m. to 11 p.m. Monday to Friday and noon to late afternoon on Saturdays. According to Dang, occasionally he worked until 1 a.m. on weeknights if there were any problems. In addition, he worked every holiday, as the bus tours ran every day, including holidays, but he didn’t receive holiday pay.
About one year after he started working in the office, Dang complained to Leung about the long hours he was putting in. Leung told him he would take care of him and knew he worked hard, and Dang accepted this response. However, a short time later when an assistant was hired, the assistant was assigned to help with administration, not to help with Dang’s duties.
During Dang’s tenure as the office manager, JBC switched to energy efficient lighting with free light bulbs as part of a government retrofit program. The garage manager for Travellers authorized him to order more lights for the garage and around the building, so he did. Ordering supplies wasn’t normally part of his job, but Dang took care of the lightbulb orders because the lighting company had initially contacted him and the garage manager had given him authorization.
Employee accepted free gifts
Because of the lightbulb orders, the lighting company shipped a free promotional jacket to Dang, which he offered to other employees but took home when no one wanted it. After another order, the lighting company sent a small TV, which Dang showed to others but took home without offering it to anyone.
In 2015, the chief mechanic for Travellers quit his job and the company didn’t hire anyone to replace him. Instead, the company allowed another employee to do the mechanic work on the buses. In December, Dang discovered that this individual wasn’t licensed to be a mechanic and Travellers had been falsifying bus inspection certificates that were required by the Ontario Ministry of Transportation.
Concerned about the potential consequences for customer and driver safety, Dang confronted Leung about the falsification of inspection certificates. He said he wanted to resign because he didn’t want the responsibility of sending a potentially unsafe bus on the road and didn’t want any buses to go out until the company found a qualified mechanic.
Dang gave Leung a deadline in early 2016 to fix the problem and said he would report the company to the ministry and resign if things weren’t taken care of by the deadline.
On Feb. 5 2016, JBC’s bookkeeper asked Dang if he knew anything about an invoice for 100 electrical plugs. Dang said he hadn’t ordered them and they shouldn’t pay for them. He contacted the electrical company to take them back and they offered a 20 per cent discount to keep them. Dang declined, as he felt the electrical company was trying to pressure him into buying the plugs.
Management jumped to conclusions
The company’s second-in-command, Angela Chiu, was informed of the invoice for plugs and all the lightbulb orders and discussed it with Leung and the garage manager. According to Chiu, the garage manager suggested the lightbulbs could have been ordered to support a marijuana grow-op, which was concerning for them as any association with a grow-up could affect Leung’s gaming licence — which permitted him to make deals with casinos to take his buses there, accounting for 90 per cent of JBC’s business. The garage manager suggested they talk to Dang about it.
However, Chiu called the police and summoned Dang to her office, where she told him he was fired. The police then told him Leung and Chiu were pressing charges against him for fraud, as they were accusing him of stealing the promotional jacket and TV. The police charged Dang with fraud under $5,000, but the charges were eventually dropped and Dang’s case dismissed.
Dang was devastated by his termination, as he felt he had put a lot into the company and didn’t feel he had stolen anything — the company had no policy on accepting promotional gifts and employees hadn’t been told they couldn’t take them home. In fact, he and other employees had received wine, cookies, and other gifts from customers on various occasions.
Dang filed a complaint for wrongful dismissal and unpaid wages, claiming more than $110,000 in damages. He opted to drop the demand to $25,000 in order to pursue the matter in small claims court.
The court found JBC didn’t have a policy regarding promotional policies, so Dang couldn’t have breached company policy. In addition, it was an established practice that employees sometimes received gifts from customers and suppliers and took these gifts home, and there was no requirement that the gifts had to be offered to other employees before taking them home. Dang didn’t think he was doing anything wrong when he took the gifts home and there was no evidence he was, said the court.
“In my view, it was unreasonable for the employer to take the position that it did, especially without speaking to (Dang) first or giving him an opportunity to explain,” the court said. “Based on the evidence, I find that the jacket and TV were given to (Dang) from the lighting company as a promotional gift and he was therefore entitled to keep them.”
The court also found there was no evidence that Dang improperly ordered lightbulbs. Dang normally didn’t order supplies and in the case of the lightbulbs, he received authorization from the garage manager. In addition, most of the bulbs were at the company’s premises and all the invoices were out in the open and paid by the company. If management didn’t approve of the amount of bulbs ordered, it should have overseen the payment more diligently, said the court.
In addition, Leung wasn’t even aware of the amount of lightbulbs ordered — he was only concerned with his gaming licence when the issue of a grow-op was randomly raised, the court said.
“There was no evidence whatsoever that (Dang) was involved in a grow-op or that he ordered the bulbs for use in a grow-op,” said the court. “They ought to have taken the time, as (the garage manager) suggested to them, to speak with (Dang) and do some investigating before taking the drastic action of calling the police.”
The court found that JBC acted in order to protect itself and preserve its gaming licence than a belief Dang had done anything wrong, in case Leung was questioned by the gaming authorities. Dang’s threat to report the mechanic issue was also likely a consideration, as it probably made management want to be rid of him. This was unreasonable, especially since he had worked many unpaid hours for the company’s benefit, the court said.
In the end, JBC didn’t have just cause to terminate Dang’s employment and didn’t give him an opportunity to explain things, which would have easily cleared things up, said the court. JBC was on the hook for five months’ pay in lieu of notice plus an additional three months for bad faith conduct on JBC’s part. In addition, the court found JBC responsible for $10,000 in damages for “emotional impact on (Dang) and mental injury,” plus $5,000 in punitive damages for JBC’s “outrageous, high-handed or malicious” actions.
The court also found Dang was entitled to $25,000 in unpaid overtime and holiday pay, making the total damages $67,925.36. However, since the maximum amount allowed was $25,000, JBC was ordered to pay that amount plus more than $7,000 in costs and pre- and post-judgment interest.
For more information see:
• Dang v. JBC Coach Lines Inc., 2018 CarswellOnt 12614 (Ont. S.C.J.).
