1829-99-ES Allan Chen, Applicant v. Wah Lung Labels Canada Inc. and Ministry of Labour, Responding Parties.

BEFORE: Patrick Kelly, Vice-Chair.

APPEARANCES: Allan Chen for the applicant; Fred Kwan for Wah-Lung Labels Canada Inc., Karima Chatur for the Ministry of Labour.

DECISION OF THE BOARD; May 5, 2000

1This is an application filed pursuant to section 68 of the Employmet Standards Act, R.S.O.1990, c. E-14, as amended, (the “Act”) for a review of the refusal of an Employment Standards Officer (“the Officer”) to issue an Order to Pay in respect of a claim for termination pay.

2Neither the applicant (hereinafter also referred to as “Mr. Chen”) nor the responding party Wah Lung Labels Inc. (hereinafter referred to as “the company”) were represented by legal counsel at the hearing which took place on April 14, 2000. Accordingly, I advised both parties that while they were entitled to participate in the hearing without representation, they bore the risk of so doing. They each indicated to me that they were prepared to take that risk.

3At the outset of the hearing, the counsel for the Ministry of Labour (“the Ministry”) indicated the Ministry supported the determination of the Officer in this matter, but reserved the right to adopt a different position after considering all the evidence. Following the closing of the applicant’s and the company’s respective evidence, the Ministry took the position that the applicant was entitled to termination pay.

4The evidence in this matter consisted of the oral testimony of the applicant and the company’s president, Mr. Fred Kwan. Many of the material facts were not in dispute. Where there was any dispute, I shall so indicate below.

5Mr. Chen was a production supervisor with Wah Lung Labels Inc. from March 25, 1997 until his termination on February 3, 1999. He began with the company as its afternoon shift production supervisor. He was the night production supervisor at the time of his termination.

6The company produces clothing labels. The job of the production supervisor is essentially to ensure that the machinery used to produce the labels is in running order, to see that mechanical problems get fixed, and to monitor the work of the machine operators. When there are no production problems, the production supervisor is expected to find other, unspecified work to do.

7On January 28, 1999, Mr. Chen gave the company notice of his intention to resign, effective February 13, 1999. He planned to devote himself completely to his studies. Mr. Chen testified that Mr. Kwan was not pleased with the resignation, and that Mr. Kwan made overtures to Mr. Chen to remain, which Mr. Chen rejected, to Mr. Kwan’s chagrin. None of the evidence on this point was contradicted by the company.

8On the evening of February 2, 1999 Mr. Chen reported for his night shift, which routinely commenced at 11:30 p.m.. At around midnight, Mr. Chen left the company’s premises in the company of another production supervisor, Mr. Johnny Leung, who was training to replace Mr. Chen. Mr. Chen and Mr. Leung returned some time later with coffee and doughnuts. Mr. Kwan was present that night, and although he did not see the two employees leave, he did see them return together. Mr. Kwan claims that they returned at approximately 12:45 a.m.. Mr. Chen testified that he was away from the company premises for about fifteen to twenty minutes, getting food and drink for himself and others. He claimed that he had not eaten in many hours, and intended to eat his food immediately on his return. However, when he saw Mr. Kwan, he had second thoughts, and decided not to eat, but to resume his duties. The normal lunch break is not taken until approximately 4:30 a.m., and Mr. Chen stated this was the reason he did not eat his food, although he had intended to prior to seeing Mr. Kwan.

9Neither Mr. Chen nor Mr. Leung punched the company’s time clock upon leaving the premises or upon returning. Mr. Chen claimed that he did not think it necessary, although he acknowledged that the purpose of the time clock was to monitor time worked by employees. He testified that he thought it was acceptable to leave the plant without recording his absence in the circumstances (according to him the machines were running and there were no production problems), that he had done so on a few previous occasions and had never been told that he could not do so. However, there was no evidence that the company ever knew of these other occasions on which Mr. Chen left the plant. Indeed, the evidence disclosed that for the most part during night shifts there was never anyone in authority over Mr. Chen from whom he could have obtained permission to leave as he did.

10The parties disagreed with respect to the amount of time that Mr. Chen was away from the plant the morning of February 3, 1999. Mr. Kwan’s evidence is that he observed the applicant and Mr. Leung returning at 12:45 a.m., which would mean that the two employees were absent for approximately 45 minutes. Mr. Chen testified that it was only 15 or 20 minutes. I do not need to resolve the discrepancy. I find that Mr. Chen left the plant for some time, and that he knowingly did not punch the time clock to signify his absence because he knew his absence from the plant was not something the company would have approved. He knew, in short, that his actions were wrong. His reaction to delaying consumption of the food he had brought back upon seeing Mr. Kwan observing his re-entry into the plant is evidence that the applicant knew either that he should not have left the plant unattended or that he should not have done so without having punched out and in again.

11Mr. Kwan said nothing to the applicant upon his return or afterward. At the hearing, Mr. Kwan attempted to demonstrate that Mr. Chen’s absence was related to an alleged reduction in production. He also stated that Mr. Chen was in breach of rules posted in the workplace, in particular a rule against the falsification of company records, including punch cards. Mr. Kwan arranged to have his manager, Zoe Ng, contact Mr. Chen by telephone at home at 10:30 p.m. the evening of February 3, 2000, an hour prior to the commencement of his scheduled shift, to advise Mr. Chen of his termination. Mr. Chen’s uncontradicted testimony is that Ms. Ng did not refer to the incident of the night before, but simply stated that given his desire to pursue his studies, he need not attend the worksite anymore.

12The company took no immediate action against Mr. Leung, who it will be recalled was also a production supervisor, and who had only marginally more service with the company than did Mr. Chen at the time of his dismissal. Mr. Kwan testified that Mr. Leung was demoted about a month later, for reasons related to his competence as a production supervisor, and also for reasons related to his unauthorized absence with Mr. Chen from the plant in the early morning of February 3, 1999. Mr. Kwan’s explanation suggests that the unauthorized absence from the plant, standing by itself, was not considered by the company to warrant serious discipline. If the company truly believed that Mr. Leung’s conduct on February 3, 1999 was worthy of serious discipline, surely it would not have delayed the imposition of discipline for a month after the fact. Furthermore, there was nothing to suggest that Mr. Leung had a superior employment record than that of Mr. Chen, thus justifying a more severe, and swifter disciplinary response against the applicant. In fact, the evidence points to the conclusion that Mr. Chen was more highly regarded by the company than Mr. Leung. Mr. Kwan, it will be recalled, was upset over the resignation of the applicant. He tried, in vain, to retain his services. He teamed Mr. Leung with Mr. Chen in the hope that Mr. Leung would learn the apparently unique aspects of supervising the company’s night production. As it turned out, Mr. Kwan lost complete faith in Mr. Leung’s ability as a production supervisor of any stripe, and demoted Mr. Leung to an operator’s position.

13I find that the company in effect condoned the behaviour of Mr. Leung, an employee of roughly the same service, but not as competent as the applicant. The company did nothing by way of confronting Mr. Chen with its concerns, nor did it seek an explanation from him for his absence and the neglect of the time clock. These facts suggests strongly to me that the real reason for Mr. Chen’s dismissal had nothing to do with his conduct on the morning of February 3, 1999. The company did not dismiss the applicant for wilful misconduct or neglect of duty, but rather for some other reason, most likely associated with his announced intention to resign his position. Even if I am wrong with respect to this finding, I find that the conduct of the applicant on the morning of February 3, 1999 did not amount to wilful misconduct or neglect of duty as contemplated by the Act. While the applicant knew that his actions were inappropriate and wrong, he could not have anticipated that he would be subject to termination as a result. In fact, the company’s response to Mr. Leung’s identical misconduct is compelling proof that no one considered a single, brief unauthorized absence from the plant as constituting grounds for any serious discipline.

14Given my findings above, it is unnecessary to consider whether the company had established and made known to employees, including the applicant, guidelines concerning employee misconduct of the kind described on February 3, 1999.

15The applicant was entitled to notice of termination in accordance with the Act.

DISPOSITION

16The Board makes the following orders and directions:

(i) the application is allowed;

(ii) The company is directed to pay forthwith to the applicant termination pay in the amount of two weeks’ regular salary based on an annual salary of $20,000.00 plus 4% vacation pay based on the gross amount of the termination pay, minus all statutory deductions, plus interest calculated in accordance with the Courts of Justice Act from February 3, 1999.

17I remain seized to deal with any issues concerning implementation of this decision.

“Patrick Kelly”

for the Board