Date: 20031231
Docket: T-1264-02
Citation: 2004 FC 1532
Ottawa, Ontario, this 31st day of December, 2003
PRESENT: THE HONOURABLE MR. JUSTICE BLANCHARD
BETWEEN:
CARL S. GANNON
Applicant
- and -
ATTORNEY GENERAL OF CANADA
TREASURY BOARD
(DEPARTMENT OF NATIONAL DEFENCE)
Respondent
REASONS FOR ORDER AND ORDER
Introduction
[1] This is an application for the judicial review pursuant to sections 18 and 18.1 of the Federal Court Act, R.S.C. 1985, c. F-7 in respect of a decision of the Public Service Staff Relations Board. The decision was rendered on March 18, 2002, by Anne E. Bertrand, sitting as an adjudicator appointed under the Public Service Staff Relations Act, R.S.C. 1985, c. P-35 (the "PSSRA").
[2] The applicant, Carl Gannon, formerly employed as a Human Resources Advisor in the Human Resources Division for the Department of National Defence ("DND") at the Naval Base in Halifax, Nova Scotia, was trained and certified with delegated staffing authority from the Deputy Minister. The Human Resources division conducts all staffing for civilian personnel who work on the base.
Background
[3] The applicant was employed with DND from November 15, 1977, until his termination on July 14, 2000.
[4] On July 13, 2000, the applicant was suspended without pay pending the outcome of an investigation of abuse of authority in relation to his hiring and alleged intimidation and harassment of Paula Robinson. On October 26, 2000, the applicant was terminated retroactively to July 14, 2000. His termination was based on the following: (1) misrepresentation of academic qualifications on résumés submitted to four Federal Government departments; (2) inappropriate preferential treatment with regard to the hiring and subsequent intimidation of Ms. Paula Robinson; and (3) the use of departmental computers and e-mail systems for unauthorized and inappropriate material.
[5] On November 26, 1999, the applicant received a five-day suspension for forging a signature on a letter, written on Department of National Defence letterhead, that inaccurately stated his salary for the purpose of a child support hearing. At a meeting on the same day, James Stewart, Director of Civilian Human Resources Service Centre, issued a warning to the applicant, both verbally and in writing, in the following terms: "...this unethical behaviour is a serious breach of the trust that comprises employer/employee relationship that I cannot in any way condone... Further misconduct of any nature will result in a more severe disciplinary penalty up to and including termination of employment."
[6] It was later discovered that, less than 14 days after this initial suspension, the applicant submitted one of four falsified résumés to the Department of Fisheries and Oceans. These résumés falsely indicated that the applicant had obtained a Bachelor of Arts degree from Dalhousie University with a specialization in human resource management.
[7] In February 2000, the applicant provided the name and résumé of Paula Robinson in response to a request from Barry Boehmer, Information Officer for Formation Logistics, for assistance in the staffing of a short-term position. The applicant did not reveal that he had had a previous relationship with Ms. Robinson that resulted in her having a child, or that there were outstanding childcare issues between them. It was further alleged by Ms. Robinson that the applicant led her to believe that he controlled her employment and that if she revealed their prior relationship, she would lose her job.
[8] Mr. Stewart suspended the applicant without pay pending the outcome of the investigation of allegations of abuse of authority and the intimidation of Ms. Robinson.
[9] The investigation revealed the existence of the false résumés of the grievor, and the scope of the investigation was consequently broadened. Ginette Laflamme, Director General of Human Resource Service Centre, testified that she discovered that the applicant applied for a position with the federal public service with the same falsified résumé during his second suspension, and that he even attended an interview for this position. The investigation also revealed that the applicant had made extensive use of office e-mails for personal matters, that included at least one inappropriate reference to sexual conduct.
[10] Despite certain mitigating factors, Ms. Laflamme concluded that the applicant's previous discipline involving the forged letter, similar current misconduct embodied in the falsified résumés, inappropriate use of office e-mail, abuse of authority and failure to abide by hiring procedure, as well as the applicant's lack of remorse or acceptance of responsibility, amounted to an irreparable betrayal of the integrity, confidence and trust of the employer/employee relationship. As such, the applicant was terminated, effective from the day he was suspended without pay.
[11] The applicant filed two grievances. Both were denied and referred to adjudication on December 21, 2000. A hearing was held in Halifax, N.S., over seven days from June 11 to 13 and from September 25 to 28, 2001.
Adjudicator's Decision
[12] The adjudicator upheld the employer's decision to suspend the grievor, but allowed the grievance on the termination and awarded the applicant six months compensation in lieu of reinstatement.
[13] The adjudicator determined that the applicant could not be disciplined for his general hiring practices of casual term employees, as it was shown that the hiring practices by many staffing officers deviated from the stated requirements. The adjudicator decided, however, that the hiring of a person with whom he had a personal relationship demonstrated preferential treatment and was clearly against policy that the applicant was required to follow as a staffing officer. Further, she took into account the fact that the applicant did not admit any wrongdoing with the hiring of Ms. Robinson and had attempted to cover up their relationship. Consequently, the adjudicator determined the employer was justified in disciplining the applicant for the hiring of Ms. Robinson.
[14] The adjudicator also concluded that the employer was justified in disciplining the applicant for his misuse of work e-mail. Since the applicant exchanged an e-mail with sexual content, the adjudicator determined a reasonable person, in like circumstances, would not view the use of sexual content in work e-mails as proper.
[15] The adjudicator also determined that though the submission of false résumés to outside sources had no bearing on the current employer, and in consequence the employer could not claim misconduct by an employee, such deception was relevant to an assessment of the applicant's lack of judgment. In the adjudicator's view, the false résumé was prepared with the clear intent to secure a higher level position with the federal civil service. A personnel officer with 12 years experience should have known better than to attempt to obtain employment by deceit.
[16] Finally the adjudicator rejected the applicant's explanation for submitting a false résumé and found his lack of remorse troublesome and indicative of a greater problem with respect to his judgment and conduct as a staffing officer.
[17] The adjudicator found, on a balance of probabilities, that the employer had just cause to impose discipline. Furthermore, the adjudicator found the applicant's inability to learn from past mistakes led her to agree with the employer's assessment that the trust in the employee was irreparably damaged and the risk of recidivism was high. The adjudicator concluded that the employment relationship with the applicant had been fundamentally breached by his own misconduct and the employer's perceived breakdown of the trust in the applicant was not unreasonable in the circumstances. In light of certain mitigating factors, such as lengthy service, a good work record, and potential future difficulties in obtaining employment, the adjudicator determined that the penalty of discharge was too severe and awarded six months' compensation in lieu of reinstatement.
Issues
[18] The applicant raises the following three issues on judicial review:
A. Did the adjudicator err in law, or refuse to exercise her jurisdiction in allowing the grievance on termination but not reinstating the applicant to his former or equivalent position?
B. Did the adjudicator breach the principles of natural justice by not allowing the parties the opportunity to be heard on the issue of remedy?
C. Did the adjudicator base her decision on erroneous finding of facts made in a perverse or capricious manner or without regard for the material before her?
STANDARD OF REVIEW
[19] On judicial review of the decision of an adjudicator under the PSSRA, the appropriate standard is patent unreasonableness. An adjudicator's decision must stand unless it is "clearly irrational, that is to say evidently not in accordance with reason" (Green v. Canada (Treasury Board) 2000, 254 N.R. 48 at 53 (F.C.A.).
Analysis
A. Did the adjudicator err in law, or refuse to exercise her jurisdiction in allowing the grievance on termination but not reinstating the applicant to his former or equivalent position?
[20] The applicant submits that his superiors who held the view that trust had been irreparably harmed were "far up the chain of command" and did not interact with the applicant. The applicant contends there is no evidence that his immediate manager and others he interacted with on the job had lost trust in him and, as such, the adjudicator's finding was patently unreasonable and reviewable. This argument is simply without merit. Senior management in any organization is responsible for the overall management of the operation and must be able to trust that employees will properly carry out their mandated responsibilities. The nurturing of this trust relationship is essential to the effective functioning of any organization, and this is particularly so when senior managers do not interact with an employee on a daily basis, as is the case in this instance. When senior management no longer trusts an employee, it matters little if co-workers are of a different view. An employee is ultimately accountable to his employer, and not solely to individuals to whom he directly reports.
[21] The applicant submits that the employer did not provide clear direction with respect to acceptable conduct, and that his errors in judgment could have been addressed and rectified through proper guidance. The applicant further argues that his ability to perform his work was never at issue and that there is no just cause for dismissal. In such circumstances, he argues that the adjudicator had an obligation to reinstate, particularly when she made a finding that termination was too severe.
[22] The respondent submits that the adjudicator did not act in a patently unreasonable manner in refusing to reinstate the applicant to his former position. The decision not to reinstate the grievor was in fact, correct: Belval v. Treasury Board (Regional Industrial Expansion) 1985 C.P.S.S.R.B. No. 19 per J.M. Canton, Q.C. The respondent further contends that issues relating to remedial authority of adjudicators warrant review on a patently unreasonable standard: Royal Oak Mines Inc. v. Canada (Labour Relations Board), [1996] 1 S.C.R. 369. Finally, the respondent argues the Federal Court has affirmed the authority of an adjudicator to award damages in lieu of reinstatement: Deigan v. Canada (Industry), [2002] F.C.J. No. 963 (C.A.).
[23] I am in agreement with the respondent on this issue. The PSSRA does not limit the remedies an adjudicator may prescribe in a grievance, and it is firmly established law that issues relating to the termination of employment are within the core of an adjudicator's jurisdiction: see McCormick v. Attorney General of Canada (Attorney General) [1998], 161 F.T.R. 82, and more recently Trevena v. Canada (Attorney General) [2001] F.C.J. No. 1282, (2001) F.C.T. 893. Upon carefully reviewing the tribunal record and the decision, it is clear that the adjudicator turned her mind to the evidence before her. She explains her conclusion as follows:
140. The employer is of the view that the grievor's actions have permanently broken the trust the employer held in this once valued employee, and this view is founded upon the grievor's unwillingness to change or reform his actions. I unfortunately share the employer's concerns. I say this particularly in light of his earlier warning in November of 1999 that any future transgressions would be considered as very serious misconduct and met with possible termination. In addition, concern for the grievor's continued misconduct is exacerbated by the fact that the grievor sought to hire, only a few short months after the employer's warning of November of 19999, the same woman with whom he was embroiled in an unpleasant family maintenance court battle, and against whom he had submitted forged and false information regarding his salary for the court's assessment.
141 Then the grievor's misdeeds continued. He warned this same employee, Paula Robinson, of the dangers of disclosing their relationship to the employer, and the grievor even took steps to cover up the relationship, and even to deny any wrongdoing when confronted with the situation by his superiors.
142 The grievor's insistence that his conduct is normal and acceptable is evidenced by his refusal to accept any blame for participating in the exchange of improper personal e-mails and internet messages while at work and for drafting a false résumé, an act which is clearly viewed as wrong as it is misrepresentation. I find it astonishing that anyone would falsify a curriculum vitae but in particular, one whose profession is human resources at the managerial level.
143 I am left with the impression that if the grievor had not been caught, he would have continued as he had done in the past, for the facts show that the grievor did not chose to correct his behaviour after receiving the written warning of November 1999.
...
147 For me to exercise my discretion and impose a lesser penalty in this case would entail reinstating the grievor with a suspension. I am not prepared to so do. The employment relationship with the grievor has been fundamentally breached by his own misconduct, and the employer's perceived breakdown of the trust in this employee is not unreasonable given the facts of this case.
I am of the view that the adjudicator's finding, that the employment relationship with the applicant has been fundamentally breached by his own misconduct, and the employer's perceived breakdown of the trust in the applicant to be reasonable in the circumstances, is supported by the evidence and is not patently unreasonable. The adjudicator did not err in the exercise of her discretion by not reinstating the applicant.
B. Did the adjudicator breach the principles of natural justice by not allowing the parties the opportunity to be heard on the issue of remedy?
[24] The applicant submits that the opportunity to be heard on the issue of remedy is a principle of natural justice and the failure of the adjudicator to observe this principle renders the decision with respect to remedy invalid. The applicant argues that not only did the adjudicator fail to reinstate the applicant, as requested, she arrived at a compensation award without hearing submissions from parties on the quantum of damages to be awarded. Section 97 of the PSSRA provides that where a grievance is referred to adjudication, both parties shall be given the opportunity to be heard. The applicant contends that, in cases where arbitrators have awarded damages rather than reinstatement, the parties were afforded the opportunity to argue whether the employment relationship was still viable, or in the alternative, the quantum of damages to be awarded based on factors such as the length of the employee's service, age, etc. (Matthews v. Canada (Attorney General), [1997] F.C.J. 1691 on line: QL, (1997), 139 F.T.R. 293).
[25] The respondent submits that the applicant's contention that the adjudicator failed to hear argument from counsel on the issue of remedy is inaccurate and not supported by any affidavit evidence. In fact, the adjudicator specifically summarizes the arguments of both parties on the issue of remedy at paragraphs 87 and 104 of the adjudicator's decision. At no stage of the hearing was the applicant denied an opportunity to call evidence or make submissions and as such, it is submitted that there has been no breach of procedural fairness.
[26] Again, I must agree with the respondent. There is evidence in both paragraphs 87 and 104 of the adjudicator's decision that the parties made oral submissions in reference to possible remedies if reinstatement was not ordered. The adjudicator notes at paragraph 104 of her decision that the applicant submitted that "...if reinstatement is not appropriate, however, then a reasonable notice period based on the grievor's length of service would be required, and legal counsel provided a listing of a number of decisions on the length of reasonable notice periods depending on length of service and nature of employment." In consequence, I do not agree that the applicant did not have an opportunity to address this issue, as it is clear from the record that submissions on the issue of remedy were in fact made by the parties and were taken into account by the adjudicator in her decision.
C. Did the adjudicator base her decision on erroneous finding of facts made in a perverse or capricious manner or without regard for the material before her?
[27] The applicant submits that the adjudicator based her decision on an erroneous finding of fact in that she did not understand the organizational structure of the Civilian Human Resources Service Centre. At paragraph 145 of the adjudicator's decision, she states that "...the grievor was a manager, a position which attracts a high level of trust. He was also a most senior Personnel Officer Manager, with delegated authority to provide employment, and charged with being an example to subordinates. He worked without supervision and with much autonomy." The applicant argues that this is incorrect as he was not a manager, but a Human Resources Advisor reporting to Human Resources Manager Paul Hartigan.
[28] The applicant further submits that the adjudicator contradicted herself on two separate occasions in her decision. First, despite the adjudicator's finding that the employer could not discipline the applicant for his casual term employment hiring practices, the adjudicator still found that the employer was justified in disciplining the applicant for the hiring of Paula Robinson. According to the applicant, since Paula Robinson was hired using the applicant's hiring practice for casual term employees, the adjudicator contradicted her own finding.
[29] Secondly, the adjudicator found the applicant's submission of false résumés to other departments was not relevant to the present case and, consequently, the employer could not allege misconduct and discipline the applicant. Yet the adjudicator found the misconduct relevant. At paragraph 133 of her reasons she wrote: "... the fact that he believed he deserved to obtain higher employment under false pretense is disconcerting." The adjudicator found that such a belief "...may be a testament to a greater problem in the grievor's ability to judge what is expected of him as a staffing officer manager and what is proper conduct in the rules of engagement for employment. I find the employer was justified in disciplining the grievor in this instance."
[30] The applicant submits that this determination is not only incorrect, but borne out of bias towards the applicant and not based on fact or law. The applicant argues that bias is further exemplified at paragraph 142 of the adjudicator's reasons where she wrote: "...I find it astonishing that anyone would falsify a curriculum vitae but in particular, one whose profession is human resources at the managerial level." Furthermore, the applicant contends that the adjudicator does not understand the evidence as his position was grand-fathered and therefore deemed to meet the university requirement in a selection process.
[31] The respondent submits that the adjudicator carefully summarized, assessed and weighed the evidence and, having taken into consideration all mitigating factors suggested by counsel, concluded that the applicant had, by his own misconduct, fundamentally breached the employment relationship. The adjudicator agreed with the employer's determination that "...trust in this once valued employee was damaged and the risk of recidivism is high." The adjudicator's decision was therefore both rational and supportable by the evidence.
[32] The respondent further submits that the adjudicator correctly noted that the applicant continued to insist that his conduct was normal and refused to accept any blame for his actions. The adjudicator noted that "...throughout these events and even during the hearing of his grievances, the grievor failed to see the error of his ways in that he believed his conduct to be beyond reproach." The respondent argues that a lack of rehabilitative potential can be a factor in whether to interfere with imposed discipline. As noted in the seminal text on Canadian labour arbitration:
Conversely, where arbitrators can imply, from the grievor's refusal to admit to a true statement of what must have been the facts, or from refusal to acknowledge the wrongfulness of his conduct...or where the risk of recidivism appears high...what they conceive to be a lack of rehabilitative potential, they have relied upon that as a factor in determining not to exercise their discretionary powers to modify the discipline imposed.
Donald Brown, Q.C. & David Beatty, Canadian Labour Arbitration, 3rd ed. (Toronto: Canada Law Book, 2002) at para. 7:4422.
[33] As such, the adjudicator's decision not to reinstate the applicant was not patently unreasonable, but correct. For these reasons the respondent submits that the application for judicial review should be dismissed.
[34] Firstly, I do not agree that the adjudicator did not have a grasp of the organizational structure of the Civilian Human Resources Service Centre. Although she occasionally refers to the applicant's position as managerial and unsupervised, she also correctly refers to the applicant's position throughout the decision. For example, at paragraph 21 of the decision, she correctly notes that the applicant was one of six staffing officers who reported to Paul Hartigan, the Senior Officer. She clearly acknowledges he is not a manager and does report to a superior. Furthermore, the adjudicator notes in the same paragraph that "...the nature of their work also requires them to be away from the office, to be working independently, and not to be under any direct supervision, except exchanges with their direct supervisor. The level of trust in this type of position is therefore very high." Therefore, even if the adjudicator does occasionally refer to the applicant's position as managerial in nature I cannot conclude that the adjudicator misapprehended the nature of the applicant's position or that she made any material error in that regard Taking into account that the applicant was largely unsupervised and required a high level of trust, her characterization of the position was reasonable and fair.
[35] Secondly, I cannot agree with the applicant's submission that the adjudicator was contradictory in her determination that the employer was justified in disciplining the applicant for the hiring of Paula Robinson. The adjudicator did not err in finding that the applicant demonstrated preferential treatment in the hiring of Pauline Robinson. The hiring of casual employees was clearly part of the applicant's mandate and responsibilities as a staffing officer. It was reasonable for the adjudicator to reject the applicant's excuse that he was not aware of the policy.
[36] The adjudicator's finding, that the applicant's attempt to cover up the hiring of Robinson was in and of itself an acknowledgment of impropriety, was justified in the circumstances, and certainly not patently unreasonable.
[37] Thirdly, the applicant states that the adjudicator erred in first determining that the applicant's submission of false résumés to other departments was not relevant to the present case and the employer could not claim misconduct by an employee to discipline an employee, and yet determining as a result of this incident that discipline was warranted. The adjudicator found that the greater problem is in the grievor's ability to judge what is expected of him and what is proper conduct in the rules of engagement for employment as a staffing officer.
[38] The applicant argues that in order to impact disciplinary action, personal conduct outside the scope of employment would have to meet the onerous Millhaven criteria as set out in Re Millhaven Fibres Limited., Millhaven Works and Oil, Chemical and Atomic Workers Int'l, Local 9-670 (1967), (1A) Union Management Arbitration Cases 328 (Anderson). The applicant contends that the employer has failed to meet the Millhaven criteria. The following questions summarize the Millhaven criteria:
1. Did the grievor's conduct harm the employer's reputation or product?
2. Does the grievor's conduct render him unable to perform his duties as an employee in a satisfactory manner?
3. Does the grievor's conduct lead to a refusal, reluctance, or inability of other employees to work with him?
4. Has the grievor been guilty of a serious breach of the Criminal Code and is this conduct injurious to the general reputation of the employer and its employees?
5. Has the grievor's conduct made it difficult for the employer to manage its operations efficiently and to direct its work force efficiently?
[39] A case could be made that the applicant's conduct would make it difficult for the employer to manage its operation efficiently thereby meeting the fifth Millhaven criteria. I am of the view, however, that the applicability of the Millhaven criteria in the circumstances of this case is not determinative. The applicant's conduct in preparing and submitting a false résumé with the objective of securing higher employment is so intricately related to his duties as a staffing officer that discipline is justified even if the Millhaven criteria are not met. Considering and interpreting résumés and employment applications is at the very heart of the applicant's mandate. The employer, in my view, was fully justified in losing trust in a staffing officer who, on his own time, attempted to obtain employment by deceit. Such activity not only brings into question his judgment, but also his ability to do his job with integrity. In such circumstances, where trust in the employee is lost, it is not unreasonable for an employer to determine that such an employee is not suited for any position within its organization. In the circumstances, the adjudicator's decision that discipline was warranted with respect to the preparation of false résumés is not patently unreasonable.
[40] The adjudicator found on a balance of probabilities that given the numerous transgressions of the applicant, the employer had just cause to impose discipline. The adjudicator clearly determined that the risk of recidivism was high, based on numerous other dishonest and disobedient acts and, following generally accepted principles of labour law, as noted by the respondent, determined that the employer/employee relationship was irreparably damaged and that termination was justified. This determination is supported by the evidence and is not patently reasonable.
[41] I am also of the view that it was within the adjudicator's jurisdiction to award six months compensation in lieu of reinstatement and that her decision to do so was also not patently unreasonable.
Conclusion
[42] On the applicable standard of review, that of the patently unreasonable decision, I can find no reviewable error in the adjudicator's decision . For the reasons set out above, the application for judicial review will be dismissed.
ORDER
THIS COURT ORDERS that:
1. The application for judicial review of the decision of Anne E. Bertrand, adjudicator, rendered on March 18, 2002, is dismissed.
"Edmond P. Blanchard"
Judge
FEDERAL COURT
Names of Counsel and Solicitors of Record
DOCKET: T-1264-02
STYLE OF CAUSE: Carl S. Gammon v. Attorney General of Canada
PLACE OF HEARING: Halifax, Nova Scotia
DATE OF HEARING: December 16, 2003
REASONS FOR ORDER BY: BLANCHARD, J.
DATED: December 31, 2003
APPEARANCES BY:
Carl S. Gannon For the applicant
Richard Fader For the respondent
SOLICITORS OF RECORD:
Carl S. Gannon For the applicant
Treasury Board Legal Services For the respondent
Ottawa, Ontario
FEDERAL COURT
Docket: T-1264-02
BETWEEN:
CARL S. GANNON
Applicant
- and -
ATTORNEY GENERAL OF CANADA
TREASURY BOARD
(DEPARTMENT OF NATIONAL DEFENCE)
Respondent
REASONS FOR ORDER AND ORDER
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