Is the surreptitious recording of one’s fellow employees cause for dismissal?
In Shalagin v Mercer Celgar Limited Partnership, 2022 BCSC 112 (CanLII), the Supreme Court of British Columbia held that it was. Hold the phone.
The plaintiff was a Certified Professional Accountant (a “CPA.”) He commenced employment with his employer, Mercer, as a financial analyst on January 6, 2010. There was no written contract governing his employment relationship with Mercer. However, the plaintiff agreed that he was bound by Mercer’s policies including a Code of Business Conduct and Ethics; and a confidentiality policy.
The Code of Business Conduct required the plaintiff to conduct himself with honesty and integrity and to adhere to the highest ethical standards in carrying out his duties on behalf of the defendant. In addition, it required him to be honest and ethical in dealing with other employees, customers, suppliers, vendors, and other third parties.
The confidentiality policy in place from April 2018 provided that the plaintiff was required to keep all confidential information strictly confidential and not directly or indirectly a) use or disclose any confidential information outside of the company; b) use any confidential information for any purpose other than those of the company; or c) remove from the premises of the company any confidential information without the prior written consent of the company.
The confidentiality obligations also required the plaintiff to make all reasonable, necessary, and appropriate efforts to safeguard the confidential information of the company. The plaintiff accepted that this policy meant that he was required to either return or destroy any confidential information in his possession after any departure from the company.
The plaintiff also accepted that while he was employed by Mercer, he was bound by the CPA’s Code of Conduct.
By 2020, the plaintiff had two positions under him in the company hierarchy. At that time, he was in receipt of the following compensation and benefits: a base salary of $123,000 per year; the right to participate in the Bonus Plan; an annual company pension contribution of a minimum of 7% of his salary; a cell phone; payment for his professional dues and for approved professional development courses; and extended medical benefit coverage.
On March 23, 2020, prior to Mercer announcing its 2019 bonuses, the plaintiff met with the company’s Human Resources Manager and had a conversation about his bonus. The manager testified that this conversation was uncomfortable and difficult. He stated that the plaintiff seemed distressed over his pending bonus, in particular the calculation thereof. They got into a discussion as to whether or not the bonus was discretionary. The plaintiff argued that the bonus should have been payable pursuant to a formula, and not discretionary.
That same day, the plaintiff raised his concerns with his supervisor. The supervisor testified that the plaintiff’s conduct at this meeting seemed odd and puzzling. It seemed to her that the plaintiff may have known about his planned 2019 bonus, which might explain why he was so upset. The supervisor testified that she did not want to disclose to the plaintiff the details of his 2019 bonus at that time, as that information had not been disclosed to all of the other managers.
After the meeting, the plaintiff sent an email to the HR manager and his supervisor in which he continued to challenge the company’s view of the bonus determination formula and entitlement and stated, among other things, “I am open to resolve this disagreement in timely manner and internally, without litigation”.
Upon receiving this email, the HR manager and the plaintiff’s supervisor were so troubled by the apparent threat of litigation that they decided they could no longer work with the plaintiff. In response, they had discussions with others on the senior management team and decided to terminate the plaintiff’s employment on a “without cause” basis.
On March 25, 2020, Mercer terminated the plaintiff’s employment without cause. Mercer paid the plaintiff the amount which it calculated was owing under the BC Employment Standards Act.
In response to the termination of his employment, the plaintiff filed an Employment Standards Act complaint, a human rights complaint, and the wrongful dismissal proceeding. In the notice of claim filed on June 2, 2020, the plaintiff alleged, among other things, the following: a) his supervisor was dishonest with him in a meeting on March 23, 2020 about incentive plan payments; b) his supervisor was rude, abrupt, and dismissive of his concerns; and c) Mercer terminated him as a reprisal for raising his incentive plan payment with his superior and the human resources manager.
As part of his human right proceeding, the plaintiff produced certain documents, including information about surreptitious recordings he had taken while employed. Later, at his examination for discovery in his wrongful dismissal case, he disclosed further information about these secret recordings. He revealed that he had made such recordings during the following meetings: a) several one-on-one training sessions from 2010 to 2014; b) over 100 “Toolbox Talk” and safety meetings, at which he often presented personally; and c) at least 30 one-on-one meetings with supervisors and human resources personnel about compensation and recruitment.
Based, in part, on this evidence obtained post-termination, Mercer’s position changed, and it now relies on cause for the termination of the plaintiff’s employment.
Decision of the BC Supreme Court
In finding that the surreptitious recordings did give Mercer cause to terminate Mercer’s employment, Justice Branch summarized the general principles applicable to wrongful dismissal claims under the law of British Columbia. As this is an Ontario employment law blog, I won’t repeat that law here- but it’s pretty similar to Ontario expectations.
Turning to the recordings, Justice Branch wrote the following:
 There is no dispute that the surreptitious recordings were made. The only question is whether the fact of the recordings go to the root of the plaintiff’s contract, and fundamentally struck at the plaintiff’s employment relationship.
 The plaintiff begins by noting that it is lawful to record conversations so long as one party to the conversation consents.
 However, legality is not the sole barometer. The question is whether the employee’s actions fundamentally ruptured the relationship, such that the mutual trust between the parties is broken.
Justice Branch then reviewed a series of cases from a number of jurisdictions in which courts have held that surreptitiously recording one’s coworkers can result in a loss of trust, which is a criterion of an employer-employee relationship.
In concluding the recordings, in this case were cause, Justice Branch wrote:
b) Although the initial recordings said to be for the plaintiff’s own language training purposes may not, on their own, have supported just cause, they demonstrate how the plaintiff’s sensitivities towards his colleagues’ privacy began to loosen. He knew that his fellow employees would be uncomfortable with even these early recordings, yet he continued to make them. I find that he knew it was wrong, if not legally, at least ethically. The plaintiff’s professional obligations provide additional support for a finding that he did not conduct himself as an employed CPA should have done. At least some of the recordings are properly viewed as being solely “for the advantage of the [plaintiff]”, to use the words of the plaintiff’s Code of Conduct. While the plaintiff’s position did not rise to the level of a fiduciary, I accept that professionals in positions of high accountability such as the plaintiff can be expected to respect the standards established by their profession: Hyland v. Royal Alexandra Hospital, 2000 ABQB 458 at paras. 12 and 28.
c) There were clearly ways to improve his English without putting his colleagues in such a position. There was no need for the plaintiff to conduct himself in this manner, but these recordings set him down a problematic path.
d) With his sensitivities lowered, he carried on to record ever more sensitive conversations, including conversations that involved personal information on other employees. The conversations included personal details about his co-workers that had nothing to do with the workplace.
e) Although the plaintiff suggests that some of his conversations were justified because of concerns about discrimination, the plaintiff simply offered no evidence that supported such allegations. Indeed, the evidence suggests to the contrary—the plaintiff received substantial promotions. While I will not comment on the merits of the plaintiff’s human rights complaint, which is based on a different record and statutory scheme, I must assess the plaintiff’s explanation based on the record before me. I cannot find that there was a legitimate basis to make recordings based on a fear of discrimination.
f) The plaintiff suggests that certain recordings were justified because of a concern about financial improprieties. However, the plaintiff had access to the manager in order to raise those concerns. Further, those concerns should have been mitigated given that Mercer’s books were regularly audited. Finally, the plaintiff offered no concrete evidence of such financial mismanagement requiring surreptitious recording in order to protect Mercer’s best interests. g) The plaintiff suggests that certain recordings were justified so that he could ensure that his own compensation was properly calculated. However, the fear of under-compensation on the plaintiff’s part appears to have been based entirely on the plaintiff’s own misapprehension that his bonus should have been calculated based on a strict formula, whereas it is clear that the bonus was discretionary. The plaintiff cannot invoke an irrational concern to support the reasonableness of surreptitious recordings that would otherwise be treated as destroying the trust between the plaintiff, his colleagues, and his employer.
h) I accept that the plaintiff was not acting with malice in making the recordings and that this is a mitigating factor. However, the fact that his stated bases for the recordings were all unnecessary or ill-founded, and several were designed to benefit him alone, weighs on the other side of the ledger. Likewise, the fact that the recordings captured personal information from his subordinates and colleagues and, thus, could not have supported his alleged purposes in any case, also weighs against his position.
i) I accept that the fact that the plaintiff did not publish the recordings and did not seek to make use of them for his own benefit outside of the ongoing legal proceedings is a mitigating factor as well. However, on the other side of the ledger, the sheer volume of recordings, and the length over which they occurred, generally offsets this factor.
j) I accept the evidence provided by [the company’s HR manager and the plaintiff’s supervisor] that they felt violated by the recordings. I also accept that this reaction was reasonable in the circumstances. Ms. Ketchuk clearly treated the plaintiff as a protegée and felt that the trust she invested in him had been violated—a trust that included telling him about personal family matters, which were recorded.
k) Looking at the effect on employment relationships more broadly, accepting the plaintiff’s argument may encourage other employees who feel mistreated at work to routinely start secretly recording co-workers. This would not be a positive development from a policy perspective, particularly given the growing recognition that the courts have given to the importance of privacy concerns. The Supreme Court of Canada has recognized the “quasi-constitutional status” of privacy issues and its role as a “fundamental value” of our society: Sherman Estate v. Donovan, 2021 SCC 25 at paras. 50–51.
l) Although allegations of after-acquired grounds for dismissal must be carefully examined, this is not the type of case where the fact of the grounds being discovered after dismissal carries particular weight. The clandestine nature of the recordings necessarily meant Mercer had no real ability to discover their existence until after Termination.
Questions about whether one can, or should, record one’s coworkers or managers in the workplace are not uncommon in an employment law practice. Often, however, the express purpose of such recordings is to gather evidence of malfeasance, such as harassment.
As noted by the court in this case, it is lawful to record conversations so long as one party to the conversation consents. Put another way, it is not a criminal offence to record a conversation to which you are a party.
However, and as Justice Branch was clear to note: legality is not the sole barometer.
The cases reviewed by Justice Branch in his reasons for decision make plain that several courts have concluded that surreptitious recording of one’s coworkers can result in a serious erosion of trust, the result of which is lawful grounds for the termination of one’s employment. Whether the same would amount to “wilful misconduct” under the Ontario Employment Standards Act’s regulation, I don’t know. I would hazard to guess that it could, given the actions required to make the recording.
That said, a lot of bad things happen in the workplace and absent a recording of what is said, there may be no physical evidence of those transgressions. That reality places employees, who believe they are the targets of harassment in an unenviable position. My sense is that not all recordings will be reviewed through the same lens- context will matter.
Takeaways for Employers
The takeaway for employers is that if you learn of evidence that, had you known it at the time of termination would have resulted in you terminating the employee for “cause” and you find yourself in the middle of a wrongful dismissal case, it may be time to have a discussion about after-acquired cause. Actions which fundamentally erode the bond of trust between employer and employee can allow an employer to terminate employment for cause. As those cases are few and far between however (noting that this case is likely to be appealed itself,) employers are cautioned to obtain specific legal advice before taking any decisions.
Takeaways for Employees
The takeaway for employees is legality is not the sole barometer. Just because you can do it, doesn’t mean you necessarily should.
However, as I note above, there may be times when making records is appropriate evidence gathering. Before engaging in any such behaviour, however, employees would be prudent to speak with experienced legal counsel about their concerns and their intentions. Legal advice specific to one’s situation cannot be contained in a blog post.
Have a workplace harassment issue? Thinking of making a recording of your coworkers? Fired from your job, or the defendant in a wrongful dismissal case? Call me. Email me. Do what works for you.
I can be reached by email at email@example.com or by phone at 613.238.6321 x233.
Sean P. Bawden is an Ottawa, Ontario employment lawyer and wrongful dismissal lawyer practicing with Kelly Santini LLP. For 2.5 years he was in-house legal counsel providing employment law advice to one of Canada’s largest corporations. He is a part-time professor at Algonquin College teaching Employment Law. He has previously taught Trial Advocacy for Paralegals and Small Claims Court Practice.
As always, everyone’s situation is different. The above is not intended to be legal advice for any particular situation. It is always prudent to seek professional legal advice before making any decisions with respect to your own case.