Salome Salons Ltd. o/a Mirror Mirror 2 v. Lorena Herrera and Ministry of Labour
0252-00-ES Salome Salons Ltd. o/a Mirror Mirror 2, Applicant v. Lorena Herrera and Ministry of Labour, Responding Parties.
Employment Practices Branch File No. 34002310
BEFORE: Anthony Brown, Vice-Chair.
APPEARANCES: Rohan Michael Robinson, Connie Dalmonte and Julio Caccamo for the applicant; Estée Garfin, Nina Gandhi, Lorena Herrera, for Lorena Herrera; no one appearing for the Ministry of Labour.
DECISION OF THE BOARD; September 14, 2000
1This is an application pursuant to section 68 of the Employment Standards Act (“the Act”) for review of an Order to Pay (No. 56643).
2The central issue in this application is whether or not the applicant must pay termination pay to the responding party, Lorena Herrera. The applicant asserts that Ms. Herrera quit her employment. In the alternative, it argues that she was guilty of wilful misconduct. Ms. Herrera states that she was constructively dismissed.
3The applicant (also referred to as “the employer”) operates a hair salon business.
4Connie Dalmonte is a partner in the business. She testified that Ms. Herrera was hired in May, 1995 as a hair stylist. She was a good hair stylist and attracted many Spanish-speaking customers to the salon because of her ability to speak Spanish. Ms. Herrera took a maternity leave from August, 1997 to February, 1998. Ms. Dalmonte stated that, during this leave, she noticed that some of Ms. Herrera’s regular customers called the Salon asking for Ms. Herrera’s home phone number. She stated that this information was not supplied to the callers because it is personal information.
5Ms. Dalmonte stated that she noticed that, upon returning from maternity leave, Ms. Herrera started taking her hair-cutting tools home with her at the end of each day and that many of her Spanish-speaking clients did not return to the salon. She also noticed that Ms. Herrera was ordering supplies through the store, in particular 12 bottles of hair “varnish”. Ms. Dalmonte estimated that about 50 per cent of Ms. Herrera’s customers (40 to 60 persons) have not returned to the salon.
6Ms. Dalmonte stated that she was informed by Martha Pareja, who works at the clothing store next door to the salon, that Ms. Herrera was cutting hair for the salon’s former customers out of Ms. Herrera’s apartment. She stated that Ms. Pareja told her that she had had her hair done at the apartment, and that she had seen other customers there. Ms. Dalmonte stated that she had seen a photograph of Ms. Herrera’s apartment showing what appeared to be a hair cutting work station in the living room.
7Ms. Dalmonte stated that she was present when her partner, Julio Caccamo, verbally warned Ms. Herrera on three occasions (in May, 1999, September 1999 and November 1999) not to serve the salon’s customers in her apartment. She stated that, on these occasions, Ms. Herrera denied that she was serving customers in her apartment. Ms. Dalmonte stated that shortly after the such third occasion, Ms. Herrera called her and said she would be embarrassed to return to the salon. Ms. Dalmonte told her that her job was still available to her and she could return and “start fresh”. According to Ms. Dalmonte, Ms. Herrera then indicated that she wished to consult her husband. Ms. Herrera called subsequently to say she would not be returning.
8Julio Caccamo also testified for the applicant. He is a partner in the salon business, which he has operated for 23 years. He confirmed much of Ms. Dalmonte’s evidence. He stated that after Ms. Herrera returned from maternity leave in February 1998 she started taking her tools home with her each evening. He stated that Martha Pareja had said that Ms. Herrera was working at home and that she had encountered line-ups of customers there. He stated that Ms. Pareja pointed out one such customer at the Mall where the salon is located. He stated that some clients had called seeking Ms. Herrera’s home number during her absence on maternity leave.
9Mr. Caccamo stated that he put “two and two together” and concluded that Ms. Herrera was serving the salon’s customers at home. He stated that Ms. Herrera. had ordered 12 bottles of hair varnish and, because one bottle of varnish lasts a long time, he concluded that the varnish was for her home business. Mr. Caccamo stated that he noticed Ms. Herrera’s customers stopped coming to the salon after her maternity leave.
10Mr. Caccamo stated that he spoke with Ms. Herrera on three occasions and asked her not to serve the salon’s customers at home. She denied doing so. He stated that, on the third occasion, he told Ms. Herrera that if she did not stop serving the salon’s customers at home, he would have to “let her go”. Ms. Herrera was scheduled to be off work the next day. Mr. Caccamo stated that Ms. Herrera called the salon and told Connie Dalmonte on the phone that she quit and that he responded, through Connie Dalmonte, that she should “come in”. He denied any intent to terminate Ms. Herrera’ employment, and noted that this incident took place just before the busy Christmas season. He estimated that Ms. Herrera took 30 –50 customers from the salon, most of whom were Spanish-speaking.
11Martha Pareja testified for the applicant. She stated that she works in the clothing store next to the applicant’s salon and, during the material time, spoke with Ms. Dalmonte and Mr. Caccamo on a daily basis. She stated that Ms. Herrera cut her hair at Ms. Herrera’s apartment, and also cut her daughter’s hair. She denied seeing other persons having their hair cut at the apartment, and does not remember telling Mr. Caccamo that Ms. Herrera was serving customers at the apartment She recalled speaking with Ms. Dalmonte and Mr. Caccamo about their suspicions that Ms. Herrera was cutting hair in her apartment. She agreed that one former customer of the salon had told her that she had had her hair done at the apartment by Ms. Herrera but did not remember if Ms. Herrera was still working for the salon at the time. She denied receiving a business card from Ms. Herrera. She stated that she paid Ms. Herrera what she felt like for her services.
12Lorena Herrera gave testimony through a sworn Spanish-English interpreter. She stated that she started work at the salon in May, 1995. She denied ever taking customers from the salon. She stated that her dresser is in the living room of her apartment because there is no room in her bedroom. She stated that she has cut the hair of four or five persons in her apartment, namely her husband, two of his friends, her husband’s cousin (Martha Pareja) and Ms. Pareja’s daughter. She stated that these persons give her money to cover the cost of her supplies.
13Ms. Herrera denied having a hair business in her apartment and stated that she does not have a business card. She stated that she went to Ecuador for four weeks in March 1999 to visit her sick mother. She stated that she took bottles of hair products as gifts and that Mr. Caccamo had ordered them for her. She agreed that some of her regular customers stopped coming to the store after her absence on maternity leave, but did not know how many. She attributed this, at least partly, to the salon’s prices, despite the fact that the price list had not changed over the relevant period of time. She stated that she took her tools home at night because other tools had gone missing about the time she started work at the salon. She had no recollection as to exactly when the tools went missing and agreed that no other tools had gone missing since she started work.
14Ms. Herrera recounted the circumstances under which her employment ended. The key events occurred during the week of November 22 to 26, 1999. Ms. Herrera stated that on the Tuesday of that week, she went to work at her accustomed hour of 3:00 p.m. Mr. Caccamo asked to speak with her at the back of the salon. He stated that he knew she was taking the salon’s customers and serving them at her apartment. He told her that she would have to leave and that she would not receive anything. Ms. Herrera stated that she denied his accusations. She stated that this was the first time he had raised his suspicions with her. She stated that she worked in the store until 8:00 p.m. that day, much of that time alone in the salon.
15Ms. Herrera stated that, on the following day (Wednesday), she spoke with “Franco” at the salon, who was unaware of what was going on. That day, Mr. Caccamo phoned the salon. Ms. Herrera took the call. He asked to speak with Franco. However, Mr. Caccamo phoned the salon a second time, at which time he asked Ms. Herrera what she was doing there. She stated that she was too afraid to reply and gave the phone over to Connie Dalmonte.
16Ms. Herrera stated that the next day, Thursday, was her day off. She called the salon and spoke with Mr. Caccamo. She asked for her back wages. She testified that Mr. Caccamo responded that he would not pay her anything and that he would say that she quit. She stated that Mr. Caccamo then said to “forget all about it” and get back to work. She stated that she could have gone back to work on the following day, Friday, but felt that she could not “work under those conditions”, working next to him in the salon after he had made the accusations. Ms. Herrera stated that she also spoke with Ms. Dalmonte by phone on the Thursday and told her she could not go back to work “after what he had said”. She stated that she did not speak with anyone on the next day, Friday. She denied that she had any intention of voluntarily quitting work.
17Pablo Donoso also testified. He is Ms. Herrera’s husband. He stated that Ms. Herrera does not work at home but she cuts his hair and that of a few close friends or relatives. He agreed that she could cut hair in the apartment during times that he was absent at work. He stated that he went to Ecuador with his wife in March, 1999 because her mother was sick. He recalled taking gifts of hair products for family members. He stated that Ms. Herrera had told him about events at work during the week of November 22 to 26, 1999 and that they had discussed whether or not she should return to work. He stated that it was his understanding that Mr. Caccamo had offered to take her back but they agreed she should not go back.
Submissions
18The applicant asserts that it did not terminate Ms. Herrera’s employment and that she chose to quit. In the alternative, it asserts that she was guilty of wilful misconduct by taking the salon’s customers after being warned not to do so and that the circumstances therefore fall within the exception mentioned in s.57(10)(c) which states that the requirement for notice of termination does not apply to
(c) an employee who has been guilty of wilful misconduct or disobedience or wilful neglect of duty that has not been condoned by the employer;
19Ms. Herrera submits that she was constructively dismissed. She asserts that a salon is a competitive business and can easily lose customers. She asserts that the salon had increased its prices (something the applicant flatly denies). She points out that, because hair varnish lasts a long time, she would not need 12 bottles for her alleged business. She asserts that the hair varnish was for gifts to people in Ecuador. The responding party submits that there is no evidence that she actively solicited the salons’ customers. She asserts that she was told to leave her job. She asserts that even though Mr. Caccamo indicated that she should come back, the employment relationship had soured and she could not be expected to continue working.
Decision
20It is clear that Mr. Caccamo and Ms. Dalmonte genuinely believed that Ms. Herrera was taking the salon’s customers. Some of Ms. Herrera’s Spanish-speaking customers had stopped attending the salon, Ms. Herrera was taking her tools home each night, and she had ordered hair varnish. Their conversations with Martha Pareja, and the photograph of the apartment, appeared to confirm their suspicions. However, Mr. Caccamo’s ultimatum to Ms. Herrera in November, 1999, was nevertheless on shaky factual ground, fuelled only by purely circumstantial evidence and Martha Pareja’s alleged comments.
21The evidence before the Board is insufficient to prove that Ms. Herrera was, at the material time, operating a hair cutting business out of her apartment other than on a very limited basis for friends and relatives. Furthermore, although the salon lost some customers, there is no evidence to show that it lost customers to any business operated by Ms. Herrera. There is simply no concrete evidence as to where the missing customers went. They may simply have gone to another salon to find a Spanish-speaking stylist after Ms. Herrera went on maternity leave. The requests by customers for Ms. Herrera’s home number do not necessarily mean, in my view, that she was operating a salon out of her apartment.
22Ms. Pareja denied seeing other customers having their hair cut at Ms. Herrera’s apartment, other than her daughter. Ms. Herrera explained that the hair varnish was for gifts to people in Equador, an explanation which I accept as being credible. Ms. Herrera admitted that she cuts hair for certain relatives and friends. Perhaps that circle of “friends” is larger than Ms. Herrera cared to admit, but, again, there is no evidence before the Board that her private activities harmed or interfered with her employer by taking its customers.
23In my view, the evidence is insufficient to show that Ms. Herrera was guilty of misconduct, wilful or otherwise.
24The witnesses have slightly different recollections about the events that led to the actual severing of the employment relationship between the applicant and Ms. Herrera during the week of November 22 to 26, 1999. However, there is reasonably close agreement that Mr. Caccamo informed Ms. Herrera in a personal conversation that if she did not stop serving the salon’s customers at her apartment she would have to leave. There is also agreement that Mr. Caccamo subsequently informed Ms. Herrera by telephone (it appears through Connie Dalmonte) that she should forget the whole thing and come back to work.
25Ms. Herrera acknowledges that she was offered the chance to return to work. However, from her perspective, she had been wrongly accused by Mr. Caccamo of taking the salon’s customers. In my view, the accusations of Mr. Caccamo were serious in nature and thus were sufficient to damage the employment relationship. A reasonable person in Ms. Herrera’s circumstances would be justified in taking the position that she could not return to work. In my view, it is particularly significant that she would have been required to work in fairly close physical proximity to Mr. Caccamo knowing that he thought she was taking his customers. This was not a large workplace where they might have been able to avoid each other. Furthermore, there is no evidence that Mr. Caccamo retracted his comments or indicated to Ms. Herrera that he had been mistaken. He simply told her she was welcome to come back. The issue of her honesty and integrity appears to have been left very much up in the air.
26I find, therefore, that Ms. Herrera did not voluntarily quit her employment. She was terminated without notice, or pay in lieu of notice, because the employer had created conditions that she could not reasonably be expected to work in. I also find that the applicant has not established that the circumstances of this case fall within the section 57(10(c) (wilful misconduct) exception.
Disposition
27The application is dismissed.
28The Order to Pay is affirmed.
29The Director of Employment Standards is directed to pay out the money held in trust as follows:
To Lorena Herrera $1,085.76
To the Government of Ontario
Consolidated Revenue Fund $ 108.58
Interest on these amounts while held
in trust shall be paid to the recipients pro rata.
“Anthony Brown”
for the Board