What is the governing test for dismissing an employee on the grounds of dishonesty?
British Columbia, Canada
The following excerpt is from Liu v. Tri-Star Seafood Supply Ltd., 2004 BCSC 912 (CanLII):
The governing test was set out in McKinley v. BC Tel, 2001 SCC 38: In light of the foregoing analysis, I am of the view that whether an employer is justified in dismissing an employee on the grounds of dishonesty is a question that requires an assessment of the context of the alleged misconduct. More specifically, the test is whether the employee’s dishonesty gave rise to a breakdown in the employment relationship. This test can be expressed in different ways. One could say, for example, that just cause for dismissal exists where the dishonesty violates an essential condition of the employment contract, breaches the faith inherent to the work relationship, or is fundamentally or directly inconsistent with the employee’s obligations to his or her employer. In accordance with this test, a trial judge must instruct the jury to determine: (1) whether the evidence established the employee’s deceitful conduct on a balance of probabilities; and (2) if so, whether the nature and degree of the dishonesty warranted dismissal. (¶ 48 – 49)
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