When a Lie can Lose You Your Job
By Howard Levitt
Silence is not
always golden. Huntley Zia said nothing after realizing his employer, Telus, had been overpaying him for more than three years -- a decision that cost him his job.
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Howard Levitt
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Zia was asked to assist in a project to modernize a telephone system in Thailand, which required a temporary relocation abroad. Before accepting the post, Zia negotiated a transfer allowance to be paid while he was in Thailand. After he returned to Vancouver, the transfer allowance continued for more than three years before it was detected.
Telus could not understand why the payments were being made. Its documentation was sparse and its institutional memory impaired because of the departure of some managers.
When he was questioned about these payments, Zia maintained they were a permanent part of his compensation to reward him for his skills in international work. The company was skeptical.
Interviews with Zia's former managers established that the allowance was only intended to be paid while he was abroad. Only a payroll oversight had caused these payments to continue.
But when Zia was asked for reimbursement, he persisted in insisting the payments were rightfully his and refusing to repay them.
Telus began deducting the overpayments from Zia's pay-cheque. Zia responded by suing his employer, claiming Telus had no authority to deduct the money. In the interim, he continued to carry out his duties. Telus gave Zia an ultimatum: Drop your lawsuit or you will be fired for cause. When he refused, he was fired.
Zia then filed an action for wrongful dismissal. Telus counterclaimed for the salary overpayments.
Mr. Justice Sidney Frankel of the British Columbia Supreme Court, found that Zia knew he was being overpaid and wrongfully took advantage of his employer's mistake for several years. When the error was discovered, he persisted in mounting a defence he knew to be baseless.
Telus was within its rights to deduct the excess payments from Zia's salary under the Canada Labour Code. Zia's behaviour and response, culminating in filing the lawsuit, effectively destroyed his employment relationship with Telus. Under the circumstances, the court ruled, Telus had just cause to terminate him. Zia was ordered to repay the balance of the overpayments.
This case is a textbook example of how to appropriately deal with allegations of misconduct: - Telus did not rush to judgment; rather, it gave the employee ample opportunity to respond to the allegations.
- It maintained meticulous documentation of the communications with the employee, ultimately critical to its success. - The employer's investigation was thorough. Telus even interviewed former employees, to accurately unearth the facts.
- The employee was provided ample opportunity to enter into a voluntary arrangement of repayment with the employer before Telus started withholding salary.
- The employer gave Zia a chance to withdraw his lawsuit. Not every legal action initiated by an employee against an employer automatically gives rise to just cause.
Howard Levitt, counsel to Lang Michener LLP, is an employment lawyer and author. Reach him at hlevitt@langmichener.ca
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