In Shalagin v. Mercer Celgar Limited Partnership, 2022 BCSC11, the BC Court ruled that a surreptitious recording of an employee’s colleagues constituted just cause for dismissal based upon the breach of trust that is required in any employment relationship.
The plaintiff commenced employment with Mercer as a financial analyst in 2010. He signed a Code of Business Conduct and confidentiality policy as part of his employment. The Code of Business Conduct required that the plaintiff conduct himself with integrity and honesty, in his dealings with both customers and colleagues. The confidentiality policy restricted the disclosure of any confidential information outside the company. The plaintiff also held a Certified Professional Accountant (CPA) designation, which had its own professional code of conduct, which required CPAs to conduct themselves ethically and to protect confidential information related to their clients.
The plaintiff believed that his supervisor had discriminated against him because of his ethnic background. Notwithstanding his perceived conflict with the supervisor, the plaintiff was promoted to Senior Financial Analyst in 2016. He also received salary increases and bonuses throughout his employment. The plaintiff’s 2019 discretionary bonus was not what the plaintiff expected to receive. The plaintiff threatened litigation over the disagreement surrounding his bonus. In response, the company determined that his employment would be terminated without cause due to his threat of litigation.
Following his termination, the plaintiff commenced a wrongful dismissal lawsuit, human rights complaint and employment standards complaint alleging that he had been discriminated against, that his supervisor had been dishonest with him and that his supervisor was rude, abrupt and dismissive of his concerns. As part of his human rights complaint, the plaintiff introduced a surreptitious recording he had taken during his employment. He had made several recordings during training sessions, during safety meetings, and of more than 30 one-on-one meetings with his supervisor. He explained that initially, the recordings were made to help him learn English, but he admitted that he never sought permission because it was not illegal.
Upon discovering this information, the Employer changed its position and took the position that there was just cause for his termination from employment. In order to establish just cause for dismissal, employers must prove that an employee engaged in conduct that was seriously incompatible with his or her employment. It is conduct that strikes at the core of the employment relationship. The test is an objective one, viewed through the lens of a reasonable employer given all of the surrounding circumstances. Conduct discovered after termination may constitute cause; however, the conduct must have occurred during the employment relationship and cannot have been known or condoned by the employer.
The Court held that surreptitious recordings fundamentally ruptured the employment relationship. The employer’s witness testified that they felt violated by the recordings. The plaintiff argued that it was lawful to make the recording, and as long as one party to the conversation consents, such a recording is not a violation of the Criminal Code. This is true, but the Court rejected this argument stating that legality is not the sole barometer to the question of whether the employment relationship is fundamentally ruptured. In reaching its final conclusion regarding the after-acquired cause for dismissal, the Court stated: “… he knew it was wrong, if not legally, at least ethically.”
The Court also rejected the plaintiff’s argument that the recordings were justified because of his concerns about discrimination, mistreatment or alleged financial improprieties by the company. The plaintiff offered no evidence to support a claim of discrimination, or any of his other allegations. In fact, the evidence suggested the contrary. In the final analysis, the Court determined that there was no legitimate basis to make the recordings based on a fear of discrimination and the plaintiff could not invoke an “…an irrational concern to support the reasonableness of surreptitious recordings that would otherwise be treated as destroying the trust between the plaintiff, his colleagues and his employer.”
The Court also acknowledged the growing importance of privacy rights in Canadian Society. The Supreme Court of Canada recognized that privacy has a fundamental value (Sherman Estate v. Donavan, 2021 SCC 25) and stated that privacy rights have a quasi-constitutional status. From a broad policy perspective, the Court stated that accepting the plaintiff’s argument may encourage other employees who feel mistreated at work to start secretly recording co-workers and that this would not be a positive development from policy perspective, particularly given the growing recognition that courts have given to the protection of personal privacy.
Employers are entitled to make reasonable workplace rules to control and direct the workplace. Employers should establish workplace rules and policies that clearly prohibit any surreptitious recordings in the workplace. Given the emergence of at-home work and growing use of video conferencing as a workplace tool, it is very easy to record meetings and conversations, where confidential matters may be discussed. Secretly recording a supervisor or co-workers undermines the employment relationship and may provide a just cause for dismissal.