March 6, 2017
On February 9, 2017 the British Columbia Supreme Court released its decision in Ram v Michael Lacombe Group Inc., which made national headlines due to egregious facts and the quantum of damages awarded to a low-level employee.
The Employee worked as a cook at Burger King for over 24 years when she was terminated without notice due to a single incident. She was 55 years old at the time of termination, and had a grade 8 education. She was the primary breadwinner for her family, as her husband was disabled. The Employer argued that it had just cause for dismissal due to the theft of a fish sandwich meal, notwithstanding the fact the Employer conceded she was a good and valuable employee with no record of discipline.
The Employee characterized the situation as a misunderstanding. The Employee immigrated to Canada from Fiji when she was 28 years old, and communicated in English at a basic level. At the end of her shift on December 27, 2013, she asked a manager if she could take a fish sandwich, and proceeded to take the sandwich, fries and a soda in plain sight. The Employer conceded she had permission to take the sandwich, but not the entire meal, constituting just cause.
When confronted by her manager, the Employee indicated she was told she could take the food, but offered to pay for the food in tears. The manager interpreted this action as an admission of theft and ultimately terminated her employment. With her employee discount, the theft of the soda and fries came to a value of fifty cents.
The Court determined that the employer wrongfully dismissed the Employee, and the particular manner of her dismissal warranted aggravated damages. In the result, the Employee was awarded general damages of $21,000 which reflects 12 months’ salary in lieu of notice, and an additional $25,000 in aggravated damages due to the Employer’s unfair and insensitive treatment.
Crucial to this award, the Court found that the Employer could not prove that the Employee actually intended to steal. She asked what she thought was permission, did not conceal her meal, and made an apology when confronted. Length of notice was an issue at trial, due to the fact the Employee worked at a number of Burger King locations in the Vancouver area during her 24 years of service. The Court applied the officious bystander test to find that an implied term in the Employee’s employment contract was that the Employer would recognize her service at all locations and treat her as a long-term employee and in doing so determined the Employee was entitled to 12 months’ notice considering her years of service, age, fluency in English, education, and health.
In assessing aggravated damages, the Court applied a two stage test:
- Whether the plaintiff established that the defendant’s conduct in effecting the termination was unfair or in bad faith because, for example, it was untruthful, misleading or unduly insensitive; and
- Whether the plaintiff established she suffered mental distress as a result of the manner of dismissal and not just as a result of the dismissal itself.
The Court found the Employee satisfied this two part inquiry. It was unfair and unreasonable for the manager to have characterized her apology as an admission, and to accuse her of theft in the presence of another employee. Further the allegation and embarrassment caused her mental distress over the normal distress and hurt feeling resulting from termination.
This case represents a cautious warning to employers that a common sense and proportionate approach to any perceived employee misconduct should always be pursued and that a mechanical application of any employer policy, including a zero tolerance policy for theft, regardless of circumstance can result in a significant adverse damages award where circumstances warrant.