Court File and Parties
Court File No.: CV-19-615357 Date: 2020-09-14 Superior Court of Justice - Ontario
Re: Gevon Attzs, Plaintiff And: Saputo Dairy Products Canada G.P., Defendant
Before: Kimmel J.
Counsel: Ryan Kornblum and Rebecca Salemi, for the Plaintiff Amanda McLachlan and Meg Bennett, for the Defendant
Heard: August 17, 2020
Endorsement
Overview
[1] The plaintiff was employed as a warehouse attendant at the defendant’s distribution center in Vaughan. He commenced part-time employment on or about March 6, 2015 and became a full-time employee on June 18, 2018. He was terminated without warning on February 4, 2019 on allegations of cause, for vaping on the premises.
[2] In this action, the plaintiff seeks a declaration that his conduct did not meet the threshold for dismissal for cause and that a lesser sanction and some form of progressive discipline or a warning would have been a more appropriate sanction. The plaintiff claims to be entitled to six months’ pay and benefits in lieu of notice for which he claims a total sum of $30,000.00, less any income he earned by way of mitigation during the notice period. Alternatively, Mr. Attzs seeks the Employment Standards Act, 2000, S.O. 2000, c. 41, minimum notice of four weeks’ pay in lieu of notice.
[3] The defendant maintains that its termination of Mr. Attzs for cause was justified because he was caught on video vaping inside Saputo’s milk and dairy product storage facility. The defendant maintains that this conduct was in contravention of the company’s policies and procedures and contrary to the Safe Food for Canadians Regulations under the Food and Drugs Act. R.S.C. 1985, c.F-27, SOR/2018-108 and to the Smoke Free Ontario Act, 2017, S.O. 2017, c. 26, Sched. 3 that came into force in October of 2018. Saputo argues in the alternative that, even if there was not just cause for its dismissal of Mr. Attzs, he would only be entitled to four, not six months’ pay and benefits in lieu of notice, net of any earnings during the notice period, or three weeks minimum pay under the Employment Standards Act.
[4] I agree with the plaintiff that, in the circumstances of this case, there was not just cause for his termination without notice. It has not been established that Mr. Attzs wilfully or persistently disregarded the company’s policies or applicable legislation. A more appropriate sanction would have been a warning perhaps coupled with a brief suspension or some other form of progressive discipline. Mr. Attzs was in a different position than the two other employees who also had been reported by the same confidential source to have been vaping on the premises on earlier occasions, because they were not captured on video surveillance and denied having done so. That difference could justify a more extreme sanction for Mr. Attzs, but did not warrant his immediate termination and dismissal. This was not a proportionate response by the company in the circumstances.
[5] I agree with Saputo that the appropriate period of pay and benefits in lieu of notice for Mr. Attzs is four rather than six months. Any earnings he made during the notice period should be deducted. Based on the calculations provided by counsel during oral argument, this translates in a judgment in favour of the plaintiff in the amount of $14,397.64.
This is an Appropriate Case for Summary Judgment
[6] The parties agree that the issues raised in this case are amenable to summary judgment under Rule 20 of the Rules of Civil Procedure and they have agreed to have the claim determined by a summary judgment. I am satisfied that it is appropriate to grant summary judgment. The requirements of Rule 20.04(2)(b) are thus satisfied.
The Facts
[7] Mr. Attzs’ job responsibilities included shipping, receiving and picking orders for the distribution of Saputo dairy products.
[8] At the time of his termination, Mr. Attzs:
a. Was 31 years old;
b. Received hourly compensation of $26.86 per hour;
c. Worked 40 hours per week;
d. Received benefits, the premiums of which were paid for by Saputo at a cost of approximately $359.02 per month;
e. Had received several written reprimands and warnings for tardiness and lack of punctuality;
f. Had not received any prior reprimands or warnings for vaping or smoking on the premises.
[9] Mr. Attzs, like all other Saputo employees, reviewed and signed to acknowledge the following policies and procedures upon the commencement of his employment with Saputo (the “policies”):
a. Worker Responsibilities Policy;
b. Good Warehousing and Distribution Practices;
c. Good Warehouse Practices (GWP) Procedure;
d. Code of Ethics; and
e. Drug and Alcohol Policy.
[10] Saputo’s employees, including Mr. Attzs, received training on these policies and acknowledged that they had reviewed and understood them. Mr. Attzs testified that he understood that certain of Saputo’s policies were necessary because of concerns about food safety.
[11] Saputo’s Good Warehousing and Distribution Policy expressly prohibits smoking inside the Vaughan facility. The terms of Saputo’s smoking policy (that smoking was prohibited inside the facility and permitted only in designated areas outside) were communicated as part of Mr. Attzs’ initial training and during crew talks that he attended in the ordinary course of his employment.
[12] Mr. Attzs acknowledged that he was aware of the no smoking policy and that there were designated smoking areas outside, and that there were signs prohibiting smoking inside. Mr. Attzs testified that he did not understand that vaping was a prohibited act of smoking.
[13] The Smoke Free Ontario Act, 2017 came into effect in October 2018. Saputo did not put up the signage required under that statute, which expressly and separately prohibits both smoking and vaping, until after Mr. Attzs was terminated.
[14] It is uncontroverted that Mr. Attzs was vaping inside the Saputo warehouse facility on January 30, 2019. Another employee reported that he had been doing so and it was confirmed on video surveillance.
[15] That same employee also reported that two other individuals had been identified as having vaped with Mr. Attzs inside the facility on prior occasions, but they were not observed by that other employee or captured on the video surveillance vaping with Mr. Attzs on January 30, 2019. Those two employees denied that they had been vaping and Saputo did not look for video footage since the specific dates of when they were vaping were not known. They were given warnings but were not terminated.
[16] Saputo treated the incidence involving Mr. Attzs as a serious infraction because of the health and safety standards that it must abide by. When confronted at a meeting on February 4, 2019, Mr. Attzs admitted that he had been vaping inside the facility on that day. He was thereafter presented with a letter advising him that his employment was being terminated for cause, effective immediately. Mr. Attzs testified that he was in shock when he received this letter. He had not expected to be terminated for vaping. He testified that he did not appreciate that vaping was a form of restricted smoking, although he was in too much shock at the meeting to defend his conduct.
[17] Mr. Attzs received no common law or Employment Standards Act, 2000 pay in lieu of notice when he was terminated.
There Was No Just Cause for the Dismissal of Mr. Attzs From his Employment
[18] The Supreme Court of Canada’s framework for analyzing whether an employee’s wrongful act will be found to constitute just cause for termination was formulated in the case of McKinley v. B.C. Tel, 2001 SCC 38, [2001] 2 SCR 161, at para. 48. It is still the operative standard.
In light of the foregoing analysis, I am of the view that whether an employer is justified in dismissing an employee on the grounds of dishonesty is a question that requires an assessment of the context of the alleged misconduct. More specifically, the test is whether the employee’s dishonesty gave rise to a breakdown in the employment relationship. This test can be expressed in different ways. One could say, for example, that just cause for dismissal exists where the dishonesty violates an essential condition of the employment contract, breaches the faith inherent to the work relationship, or is fundamentally or directly inconsistent with the employee’s obligations to his or her employer.
[19] This involves a twofold assessment of the alleged misconduct, requiring an examination of “(1) whether the evidence established the employee’s deceitful conduct on a balance of probabilities; and (2) if so, whether the nature and degree of the dishonesty warranted dismissal.” The proportionality of the punishment (dismissal) must be commensurate with the nature and extent of the dishonesty. See McKinley, at para. 49.
[20] The assessment involves a contextual analysis that requires the court “to examine the case on its own particular facts and circumstances, while considering the nature and seriousness of the misconduct, in order to assess whether it is reconcilable with sustaining the employment relationship.” See Barton v. Rona Ontario Inc., 2012 ONSC 3809, 1 C.C.E.L. (4th) 32, at para. 12.
[21] The court in Barton (at para. 14) summarized and relied upon the analytical framework set out by the Court of Appeal in Dowling v. Ontario (Workplace Safety and Insurance Board) (2004), 2004 CanLII 43692 (ON CA), 246 D.L.R. (4th) 65 (Ont. C.A.), at paras. 49-50, wherein the appeal court described the application of the Supreme Court’s standard to consist of:
a. Determining the nature and extent of the misconduct;
b. Considering the surrounding circumstances; and
c. Deciding whether dismissal is warranted (i.e. whether dismissal is a proportional response).
a) The Nature and Extent of the Misconduct
i) The Nature of the Misconduct – Deceit/Knowledge
[22] The first and threshold consideration under the McKinley analytical framework requires an examination of whether the evidence establishes the employee’s conduct to be deceitful on a balance of probabilities.
[23] To establish dishonesty, Saputo must demonstrate that Mr. Attzs knew that vaping was covered by the no-smoking policy. Saputo argues that his evidence that he was unaware of this equivalency is not credible, and that it has shown he was aware that vaping was prohibited, because:
a. The other two employees who were reprimanded and warned (but not fired) for allegedly vaping with Mr. Attzs are said, on information and belief, to have acknowledged that they knew that vaping was not permitted; and
b. Mr. Attzs is alleged to have been attempting to hide the fact that he was vaping when observed in the surveillance video footage.
[24] On the first point, there is no direct evidence from the other two employees, or any other employee, that they understood prior to February of 2019 that vaping was prohibited by the company’s general no smoking policy. Even Mr. Briard, Saputo’s witness, only goes so far as to say that at the conclusion of his meeting with these two other employees they said they understood that vaping was against the company’s policy. This meeting took place after Mr. Attzs had been terminated, after they had been confronted about vaping on the company premises, and after they had denied vaping and were given a warning not to do so.
[25] Further, aside from a general statement by a manager (Briard) who did not testify that he was directly involved in employee training, there is no evidence that employees were told as part of their training that the company’s no smoking policy extended to vaping. While evidence based on information and belief is technically admissible on a motion under Rule 39.01(4), Mr. Briard’s evidence does not establish that the company’s employees were told or understood this prior to January 30, 2019.
[26] Even Mr. Briard’s general assertion that employees are advised that the prohibition extends to vaping is not specific to the period prior to January 30, 2019. The Smoke Free Ontario Act, 2017 had, at the time of the termination of Mr. Attzs’ employment, only recently come into effect and its explicit prohibition on both vaping and smoking had not yet been publicized by Saputo to its employees. The evidence establishes that it was publicized and communicated in employee training after that and it is a reasonable inference that Mr. Briard’s testimony refers to that later time period.
[27] The second-hand evidence of other employees that is not specific as to the time frame of their knowledge, considered in light of the absence of any evidence that smoking and vaping were equated in any employee training prior to January 30, 2019, is not sufficient to establish, on a balance of probabilities, that Saputo employees generally, or Mr. Attzs in particular, understood that the prohibitions on smoking in the company’s policies applied to vaping prior to January 30, 2019.
[28] I am not prepared to infer that any reasonable employee in January of 2019 would equate vaping with smoking traditional cigarettes, as Saputo’s counsel urged me to do. That inference is not supported by the evidence.
[29] Saputo, as an employer terminating an employee for cause, has the onus of establishing on a balance of probabilities that Attzs was deceitful or engaged in some form of knowing misconduct.[^1] This onus has not been met. Saputo argues that the fact that Mr. Attzs only stated for the first time on cross-examination that he did not understand the company’s no smoking policy to include vaping undermines the credibility of his denial. Mr. Attzs explained that he did not defend himself during the February 4, 2019 meeting because he was in shock. I will not attempt to go behind the litigation strategy of not highlighting this denial up front. Since the onus on this part of the test is on Saputo and it has not been met, the denial by Mr. Attzs is corroborative, but not determinative, of my conclusion that the element of knowing misconduct or deceit has not been established in this case.
[30] I turn next to the surveillance evidence. Having observed the surveillance video myself, it is not obvious to me that Mr. Attzs was attempting to hide the fact that he was vaping. He is shown to be walking in a large warehouse in which there were other people. The fact that he is vaping is obvious from the vapers that are emitted. Without having been confronted with the surveillance video, he openly admitted that he was vaping when asked about it on February 4, 2019. He did not attempt to deny it. In these circumstances, I am not prepared to infer, as Saputo urges me to do, that Mr. Attzs was trying to hide the fact that he was vaping or that there is evidence that he knew he was doing something that was prohibited. I am not satisfied on the threshold question that Mr. Attzs was acting intentionally or dishonestly.
[31] Nor is the type of wilful misconduct or disobedience found in other cases such as Miller Waste Systems Inc. v. Charlebois, 2019 CarswellOnt 5562 (OLRB) and C-Ing Graphics Ltd. v. Cunha, 2002 CarswellOnt 10270 (OLRB) made out on the facts of this case. These cases considered the more stringent test under s. 2(1)(3) of Ontario Regulation 288/01 under the Employment Standards Act, 2000, notice. In that context, pay in lieu of notice is required unless the employer establishes the employee was guilty of “wilful misconduct, disobedience or wilful neglect of duty that is not trivial and has not been condoned by the employer.” The level of dishonesty that would have to be established to disentitle Mr. Attzs to his Employment Standards Act, 2000 notice is even a higher threshold than of “subjective intent, almost akin to a special intent in criminal law.” (Plester v. Polyone Canada Inc., 2011 ONSC 6068, at para. 56, aff’d 2013 ONCA 47; see also Oosterbosch v. FAB Aerospace Inc., 2011 ONSC 1538, at para. 19). The higher threshold of intentional or wilful misconduct is not met in this case where the lower common law threshold cannot be met.
[32] What these and the other cases relied upon by the defendant suggest is that, if the company policies had expressly prohibited vaping and/or if the employees had been told that the prohibition on smoking cigarettes inside included a prohibition on vaping, and/or if the signage and communications contemplated by the Smoke Free Ontario Act, 2017 had been implemented by Saputo prior to January 30, 2019, then the type of wilful disobedience required might have existed in this case, but none of that has been established on the record before me.
(ii) The Extent of the Misconduct – the Seriousness of the Infraction
[33] My findings above do not diminish the seriousness or importance of the health and safety requirements that Saputo must abide by in the context of the strict regulations applicable to the handling of food by its employees. I accept Saputo’s concerns about the seriousness of the infraction because of the potential for this to cause the company to be offside of the Food and Drugs Act and Safe Food for Canadians Regulations, that prohibit the use of tobacco products[^2] in food storage facilities.
[34] I also accept the submission of Saputo that the misconduct need not result in actual harm, it is enough that it gives rise to a risk of harm. See Miller Waste Systems, at para. 25.
b) The Surrounding Circumstances
[35] The regulatory context is part of the surrounding circumstances.
[36] I also take judicial notice of the fact that under the Smoke Free Ontario Act, 2017 the legislature did not consider it to be obvious that vaping was covered by no-smoking restrictions and signs because it legislated a specific new requirement that employers post signs that clearly and expressly prohibit both smoking cigarettes and vaping, and that information about these two prohibitions be provided to employees.
[37] None of this legislated signage or training had occurred at the Saputo warehouse at which Mr. Attzs worked prior to his termination; it was all done afterwards, between February and September of 2019. The fact that Saputo had not informed Mr. Attzs or its other employees by signage or through other communications about this new prohibition is a relevant consideration, beyond the specific company policies (which I have already found did not expressly prohibit vaping inside).
c) The Proportionality of the Sanction
[38] In a case of alleged termination for cause, the court must also consider whether the proportionality of the punishment (dismissal in this case) was commensurate with the nature and extent of the alleged dishonesty. This requires a consideration of whether the nature and degree of the dishonesty warranted dismissal.
[39] Dismissal for flagrant or blatant violations of no smoking policies may be a proportionate response and grounds for dismissal with cause (see, for example, Miller Waste Systems and C-Ing Graphics, decisions of the Ontario Labour Relations Board that considered cause in the more stringent context of the Employment Standards Act context). Mr. Attzs dismissal was said to be justified on the basis that he was flagrantly violating company policies by vaping inside, but having failed to establish that his conduct was flagrant, wilful or intentionally deceitful, I find that his termination was not proportionate even though vaping was prohibited by the Smoke Free Ontario Act, 2017 at the time.
[40] This case is also distinguishable from the case of Re: Renae and Champs Mushrooms Inc., 2014 CarswellNat 596, at para. 42, in which a policy violation was found to justify termination for cause where the policy was found to have been clear and unequivocal and brought to the employee’s attention.
[41] In contrast, the Saputo policy of no smoking did not clearly and unequivocally include vaping. Further, the Smoke Free Ontario Act, 2017 mandating explicit signage and communication specific to the prohibition on vaping inside the premises had not yet been complied with by Saputo, nor had this been brought to the attention of Mr. Attzs before he was terminated.
[42] The other two employees reported to have been seen vaping with Mr. Attzs were given a warning (progressive discipline), not fired. While the evidence of vaping was not as strong against them, the company must have been satisfied that the discipline and warning was proportionately sufficient to deter them from repeating the alleged infraction and to satisfy the company’s safety concerns.
[43] Employees should be given the opportunity “to mend their ways before being discharged.” See Payne v. Bank of Montreal, 2013 FCA 33, at para. 20. That appears to be the approach taken by Saputo in relation to the other employees, but not Mr. Attzs. Mr. Attzs should have received progressive discipline and a warning or perhaps a suspension, prior to being terminated for cause. The nature and degree of his conduct did not warrant his immediate dismissal.
[44] The words of the Lauwers J. (as he then was) in Barton (at para. 55) are equally applicable in this case:
In applying the McKinley analysis, the “principle of proportionality” requires me to consider whether the termination was the “effective balance” to “be struck between the severity of an employee’s misconduct and the sanction imposed”. I find that Mr. Barton’s specific acts of misconduct are not severe enough to warrant his dismissal. This is a situation in which a stern warning to Mr. Barton never again to permit a safety infraction by an employee would have sufficed to ensure that neither the incident nor another one like it would ever occur under Mr. Barton’s watch. Some other discipline short of termination might also have been appropriate. Taking the approach of Warkentin J. in Ritchie v 830234 Ontario Inc, [2009] O.J. No. 2800 and of Echlin J. in Tong v. Home Depot of Canada Inc, in my view progressive discipline would have been effective. There was nothing in Mr. Barton’s excellent work record to suggest that he would not be amenable to such discipline or that he would repeat such misconduct in the future. I am, in short, unable to find that Mr. Barton’s misconduct meets the threshold in Dowling of striking at the heart of the employment relationship.
What is the Appropriate Pay in Lieu of Notice for Mr. Attzs?
[45] An employee’s common law entitlements on termination have for decades been determined in accordance with the factors set out in Bardal v. Globe and Mail (1960), 1960 CanLII 294 (ON SC), 24 D.L.R (2d) 140, at 145 (Ont. H. Crt. J.), with regard in each particular case to “the character of the employment, the length of service of the servant, the age of the servant and availability of similar employment, having regard to the experience, training and qualifications of the servant.”
[46] In more recent years, the courts have recognized that more junior level employees will not necessarily get shorter notice than more senior employees, in part because it is not necessarily the case that they will have an easier time finding alternative employment. The character of employment has become a factor of declining importance. See Arnone v. Best Theratronics Ltd., 2015 ONCA 63, 329 O.A.C. 284, at para. 11 and Drysdale v. Panasonic Canada Inc., 2015 ONSC 6878 at para. 15.
[47] During the claimed six-month notice period, the plaintiff in this case was able to work as an Uber driver but earned significantly less than he had with Saputo.
[48] I am not satisfied, based on the cases that have been presented, that there is a precedent for a 31-year old four-year employee, the first three of which were part-time, being awarded six months’ notice. The reasonable notice period is case specific and “is an art not a science… in each case, trial judges must ‘weigh and balance a catalogue of relevant factors.’” See Lowndes v. Summit Ford Sales, Ltd. (2006), O.A.C. 55 (C.A.), at para. 9. I find four months to be a reasonable notice period in this case. Mr. Attzs had a highly transferable skill set and, while he claims not to have been able to find alternative employment aside from working for Uber, I find that he should have been able to do so within four months, even without a reference from his former employer.
[49] Four months’ notice is well in excess of the minimum notice requirements under the Employment Standards Act which would have afforded him one week per year of service, or three weeks’ notice.
[50] Based on Mr. Attzs’ hourly wage of $26.86, his 40-hour work week and the value of his paid benefits, it was confirmed during oral argument that his net entitlement would be $4,656.62 per month, totalling $18,626.46 for four months. From this, his Uber earnings must be deducted over the same period, which total $4,228.82 for the four months post-termination. That leaves a net amount $14,397.64.
Disposition, Costs and Implementation
[51] Mr. Attzs is entitled to judgment in the net amount of $14,397.64 plus interest and costs.
[52] The parties provided their bills of costs, but asked for the opportunity to make cost submissions. I encourage the parties to try to reach an agreement on costs now that the outcome of the motion and the action is known. If they are able to do so, counsel are directed to advise the court of such agreement on costs on or before October 2, 2020. Given that the plaintiff succeeded, but not on all points, I have decided that, if no agreement is reached, I should wait and receive the parties’ cost submissions before making any ruling on costs.
[53] If no agreement is reached on costs, each side may deliver to the other and file with the court a brief submission on costs (of no more than 3 pages double spaced), together with their bill of costs on October 9, 2020 and each may deliver and file a brief response to the other side’s costs submission (of no more than 1.5 pages double spaced) on October 16, 2020. The court copies of these costs submissions may be filed by email to my assistant: linda.bunoza@ontario.ca. If the court has not received any cost submissions from the parties by October 9, 2020, or such later date as the parties may ask the deadline to be extended to and the court may permit, the issue of costs will be deemed to be settled without the necessity of any further ruling from the court.
[54] Notwithstanding Rule 59.05, this endorsement is effective immediately and is enforceable without any need for entry and filing. In accordance with Rules 77.07(6) and 1.04, no formal Order need be entered and filed unless an appeal or a motion for leave to appeal is brought to an appellate court. Any party to this decision may nonetheless submit a formal Order for original signing, entry and filing when the court returns to regular operations.
Kimmel J.
Date: September 14, 2020
[^1]: Or prolonged incompetence (not alleged in this case). See Khashaba v. Procom Consultants Group Ltd., 2018 ONSC 7617, at para. 53.
[^2]: I did not receive extensive submissions about the definition of tobacco products and whether that would, or would not, include vaping or vaping products.