Arbitrator upholds termination for employee breach of trust and abuse of benefits

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In cases of employee dishonesty, particularly those related to misuse of employer benefits, there are few mitigating factors that can move an arbitrator to reduce the discipline imposed by the employer.  Arbitrators take such misconduct very seriously and are generally more motivated by the desire to deter such behaviour than the desire to rehabilitate a single employee.  The recent arbitration decision of VHA Home Health Care and OPSEU (T.(M.)) (September, 2013) demonstrates the seriousness with which arbitrators approach employee dishonesty in the context of sick leave.

In VHA Home Health Care and OPSEU (T.(M.)), the grievor was on an approved medical leave and receiving long term disability (LTD) benefits from the employer’s insurer.  The grievor’s eligibility for LTD benefits was dependent on two criteria.  The first was that the employee be totally disabled in that she was wholly prevented from performing each and every function of her employment.  The second was that the grievor not receive any remuneration from any employment.  Part way through the grievor’s leave of absence the employer became aware that the grievor was working part time at another job, and was working as a real estate agent.  The employer conducted an investigation and concluded that the employee was not totally disabled and was capable of performing accommodated work duties.  The employer also found that the grievor misled the employer and the insurer about her work activities and the income she was receiving.  Based on the investigation, the employer terminated the employment for abuse of sick leave and breach of trust.  The union filed a grievance alleging that the employee’s medical leave was legitimate and that the employer was aware of the grievor’s other employment.  The union also argued that the employer’s decision to terminate the employment was both rigid and unsympathetic in light of her significant service and good employment record.

At arbitration, the arbitrator found that the grievor had taken active steps to hide her additional employment and income from the employer’s insurer. The grievor failed to disclose other employment on one of the claim forms she filed for LTD benefits. The grievor also asked her other employer to delay payment to her so that she would not be receiving income while also receiving LTD payments.  The arbitrator found that that action alone demonstrated the grievor schemed to hide her employment income from the insurance carrier. Finally, the grievor lied to the insurance carrier when confronted with the allegation she was working and receiving income from another employer.

The arbitrator noted that fraud in respect of benefit claims is easy to commit and difficult to detect and therefore taken seriously in the arbitral jurisprudence.  The arbitrator found that the grievor’s serious illness mitigated in her favour and that the nature and amount of work she performed for others did not establish that the grievor abused her sick leave. Because the arbitrator concluded the grievor was too ill to engage in productive work, and did not engage in productive work, it was not necessary to address the employer’s assertion that the grievor ought to have approached the employer to seek accommodated duties. However, the arbitrator found that working at another employer to any degree, trying to hide it and lying about it to the insurance carrier constituted serious misconduct justifying termination.  The arbitrator also found that the grievor did not accept responsibility for her actions and was dishonest during the arbitration hearing.  This was seen by the arbitrator to aggravate the already serious misconduct of the grievor.  The arbitrator refused to exercise her discretion to impose a lesser penalty than termination, and dismissed the union’s grievance.

For further information, please contact Carole Piette at (613) 940-2733.