The Question
I was fired with cause, along with 20 other employees, for claiming sunglasses on our health benefit plan. This occurred at a time when the company was in the process of merging two operations into one. Consequently, they had to downsize. Do I have any recourse?
The First Answer
Jason Edwards, Associate, Pink Larkin, Halifax, N.S.
It sounds like your employer is using the sunglasses claim as a way to escape its common law or statutory obligation to provide you notice of termination or pay in lieu of notice.
An employer can terminate an employee’s employment without notice, or pay in lieu of notice, if they have ‘just cause’. Termination of employment without notice is considered the ‘capital punishment’ of employment and should be reserved for the most serious misconduct, such as theft, open insubordination or if an employee repeatedly commits misconduct and shows no sign of correcting their behaviour.
Whether an employer has just cause to dismiss an employee without notice is a legal question; it is not up to the employer to decide whether it owes the employee notice or pay in lieu.
While it will depend on the specific circumstances of your case, the improper claim for sunglasses may not rise to the level of just cause for summary dismissal. If 20 other employees made similar claims, there was likely confusion as to whether such claims were allowed. Maybe the employer condoned the claims? Had you been disciplined for similar misconduct in the past? Maybe the claims shouldn’t even be considered misconduct—it is likely the benefit plan administrator’s responsibility to apply the plan text and allow or reject claims.
If the employer does not have just cause to terminate your employment, you might be owed substantial severance.
The Second Answer
Hermie Abraham, Lawyer & Founder, Advocation Employment Law, Toronto, Ont.
You could possibly have a constructive dismissal case, but there is also a good chance that your ‘just cause’ termination is lawful. Like most legal questions, the answer depends on the fact scenario surrounding your case.
Claiming sunglasses on your health benefits (when the plan doesn’t allow for this) might seem like a small matter. But as an employee, you have an implied duty to act in a trustworthy manner and faithfully serve your employer. When you breach this trust, it can lead to a just cause termination: this misconduct falls under the umbrella of ‘benefits fraud,’ which has resulted in employee dismissals in other workplaces. So, even though your employer might have other motivations to end your employment (i.e. the merger), your misconduct might have handed them a gift by allowing them to end your employment without termination compensation.
That said, whether your dismissal was warranted needs to be weighed against the facts of your case. Was your claim for sunglasses a mistake or intentional? Did you misuse the benefit plan once or was there a pattern of this behaviour? Have you worked for your employer for a short time, or is this your first instance of misconduct in a long-storied career? The less ‘blameworthy’ your conduct, the more likely that this is a wrongful dismissal and you would be entitled to a termination package.
In any event, job loss is serious, so you should meet with an employment lawyer to understand your legal rights and entitlements.
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