Family Feud Leads to Damages for Wrongful Dismissal

Previously printed in the LexisNexis Labour Notes Newsletter

In TeBaerts v. Penta Builders Group Inc., 2015 BCSC 2008, the B.C. Supreme Court awarded nearly $94,000 in damages to a 32-year old project consultant and account manager after finding she was wrongfully dismissed by her employer, a family-run business.

Background

The plaintiff, Karena TeBaerts, was employed by Penta Builders Group Inc. (“Penta”) for approximately 11 years. Penta is involved in the business of building homes as well as real estate development and also employed TeBaerts’ brother and father. In addition, the Penta president’s two daughters and son-in-law were employed by the company.

In November 2014, TeBaerts learned that the son-in-law resigned from his employment with Penta and, during his exit, engaged in a verbal altercation with TeBaerts’ brother. After his resignation, the son-in-law remained engaged in work for one of Penta’s associated companies for which Penta performed services, Oaktree Farms Ltd. (“Oaktree”). TeBaerts was relieved from her duties on a certain group of Oaktree homes and was advised that another designer would be hired for those projects.

Shortly thereafter, TeBaerts deleted files, which included specifications, related to the Oaktree projects. On learning of the file deletion that same day, Penta requested that TeBaerts take the necessary steps to reinstate the deleted information. She explained that she deleted the files based on her assumption that they were no longer needed, and that she regularly engaged in cleanup of the server in order to keep it organized and relevant. She maintained that it was her understanding that Penta would no longer be involved in the construction of Oaktree homes and that someone else would be engaged to do the specifications. TeBaerts arranged with IT for the files to be recovered, which was done successfully later that day.

Penta then accessed TeBaerts’ work e-mail account and found an e-mail exchange between TeBaerts and her mother, wherein the latter indicated she was looking for alternative jobs for TeBaerts’ father. Her father was a senior project manager at Penta and an important employee. TeBaerts suggested that her mother contact a recruiter for him. In this e-mail exchange, TeBaerts also wrote about the deletion. Regarding the son-in-law, she stated, “I went in and deleted all of the other design work I had done for ‘his’ houses so he can’t use it or refer to it”. She also said that the son-in-law was “getting rewarded for his asshole behavior as per usual and it’s ridiculous”.

As a result, Penta terminated TeBaerts’ employment for what it claimed was just cause. TeBaerts brought an action against Penta for wrongful dismissal which included a claim for aggravated and punitive damages, and a claim for breach of privacy under the B.C. Privacy Act due to Penta’s intrusion into her work e-mail account.

Penta maintained that it had to terminate TeBaerts’ employment because she deleted the files with malicious intent, was not forthright and honest in her explanation for her reasons for the file deletion, and breached her duty of loyalty and good faith by advising her mother to seek a recruiter for her father.

Decision

On the issue of whether there existed just cause for termination, the B.C. Supreme Court applied the traditional contextual approach, acknowledging the need for proportionality between an employee’s conduct and the sanctions imposed by the employer. The Court accepted that to the extent TeBaerts’ motivation in deleting the files was to prevent the son-in-law from using or benefitting from those files, that was an error in judgment that was not driven by spite or malice. Although TeBaerts did not disclose this reason to Penta, her explanation was merely “incomplete” and did not rise to the level of dishonesty. The Court held that TeBaerts’ suggestion that her father utilize a recruiter “did not come close” to breaching her duty of loyalty and good faith.

The Court concluded that Penta’s decision to summarily discharge TeBaerts was “significantly disproportionate to her conduct” and awarded her damages equivalent to 12 months of salary, vehicle allowance, loss of benefits and loss of management bonuses as well as costs. The Court did not award any aggravated or punitive damages.

With respect to TeBaerts’ breach of privacy claim, the Court noted that the totality of the circumstances should be examined to determine whether the plaintiff had a reasonable expectation of privacy. Some of the factors that the Court considered in answering that question were:

• the computer was owned by Penta;
• there were very relaxed security procedures to protect against unauthorized access to employee computers;
• employees often left their computers unlocked without passwords; and
• other employees knew TeBaerts’ password and used her computer.

The Court concluded that there was no reasonable expectation of privacy and Penta did not breach TeBaerts’ right to privacy as set out in the Privacy Act. Accordingly, her breach of privacy claim was dismissed.

Takeaways

The facts of this case demonstrate that conflicting family dynamics can give rise to serious workplace issues. As well, uncertainty around the treatment of work files as well as appropriate standards of computer use and security can be a recipe for workplace conflict.

This case also confirms that employees do not have an absolute right to privacy at work. Rather, the totality of the circumstances will be considered when assessing whether an expectation of privacy is reasonable. Pursuant to Supreme Court of Canada authority, that expectation of privacy may be diminished when personal information is stored on a workplace computer. Employers can also navigate these challenges by implementing, communicating and consistently enforcing clear workplace policies regarding technology use.