Employers usually have a duty to investigage misconduct before issuing discipine
A Manitoba court has upheld the firing of a dairy company employee for stealing product, even though the company didn’t conduct its own investigation into the misconduct.
The worker, 47, was a sales representative for Saputo Dairy Products, a Montreal-based producer of dairy-based foods, since 2002. He sold cheese products to grocery stores in Winnipeg as well as rural areas of Manitoba and northwest Ontario.
During store visits, the worker checked the cheese in stock and removed any that he deemed unsaleable. If the reason was a quality control issue originating with Saputo, he gave the store a credit. Saputo had no written policies on issuing credits or disposing of unsaleable units, but it had a policy with Loblaws requiring a monthly cheese credit form to be signed by the store manager.
On Aug. 21, 2015, the worker visited a Loblaws Superstore in Winnipeg. He formally signed in and obtained a visitor badge before going to the dairy section. the worker noticed that some packages of Saputo cheese were discoloured and soft, so he removed them and examined them to determine which ones warranted credit.
After getting a store employee’s approval of the units to be credited, the worker couldn’t find the employee with the key to the “wet compactor” — a device used to destroy packaging containing moist or liquid substances. He decided to take the units home to dispose of them — which was not his normal practice. He put the units into a milk crate and signed out of the store.
However, after the worker loaded the units into his car, a store security officer and the assistant manager arrived and examined the units in his trunk. They asked him to come back into the store while they investigated. They discovered that the worker had taken a unit of another brand and the assistant store manager also felt that the units the worker had removed were “perfectly saleable.”
A couple of days later, the worker apologized to the store manager for the mix-up and said that he hoped they could “fix this and move on” without telling his supervisor. However, the store manager said it was now a loss prevention matter.
The worker told his supervisor that he had made a mistake and he hadn’t intended to steal cheese. When asked why he had removed cheese without proper paperwork, he responded that he was tired after a long day of driving and in a rush to get to a party raising funds for a wedding. According to the supervisor, the worker mentioned he had intended to bring the cheese as a gift to the party, but Saputo’s donation policy required authorization. He also didn’t mention that he had taken a unit of another brand.
Termination leads to wrongful dismissal claim
On Sept. 1, Saputo terminated the worker’s employment. He claimed wrongful dismissal, saying Saputo should have conducted its own investigation, it arbitrarily enforced unwritten policies and it unfairly held him to a standard of perfection. He argued that it was “a simple mistake that any Saputo employee might have made.”
The Manitoba Court of Queen’s Bench disagreed that the incident was a mistake. The worker had 13 years of experience with cheese sales, so he was familiar with the processes and paperwork required for the removal of unsaleable product. The fact that he volunteered to dispose of spoiled units on that particular day, contrary to established procedure, made it “more likely than not that [the worker] took the cheese for his own benefit,” said the court.
The court also found that the workerwasn’t honest with his supervisor, failing to mention he had taken a unit of another brand and trying to explain it away. If the worker was tired and rushed, it would have made more sense to leave the cheese to be destroyed at the store, said the court.
The court determined that, although Saputo didn’t consistently enforce its policies and didn’t conduct its own investigation, that didn’t change the seriousness of the worker’s misconduct. His dishonesty and the information Saputo had from the store’s manager and assistant manager were sufficient evidence to prove just cause for dismissal.
“Saputo did not owe [the worker] a duty to investigate,” said the court. “It had a duty to treat him fairly and honestly based on the information that it had at hand on the day it terminated his employment and I find that it fulfilled that duty.”
For more information, see:
- McCallum v. Saputo, 2020 MBQB 66 (Man. Q.B.).
How is occupational fraud or theft usually detected?
40% tips
15% internal audits
13% management reviews
7% by accident
Source: Association of Certified Fraud Examiners
