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Employer had just cause to terminate an employee who worked a second job

conflict-of-interestIn some unfortunate cases, Canadians need to work two jobs in order to make ends meet. Well, it seems that sometimes taking a second job may not be a good idea. The British Columbia Provincial Court recently found that an employer could terminate an employee for just cause because that employee had a second job and refused to quit when she was asked.

Why? Even though the employee had other second jobs before she was promoted to bank supervisor (unrelated jobs like selling party candles), her job as supervisor involved indirect sales responsibilities, where she was expected to suggest certain services and refer the customer to the appropriate person in the branch.

Her second job as real estate agent put her in potential conflict of interest situations and in potential competition with the bank, given that selling real estate was directly related to what the bank did, that is, lending money to clients so they could buy real estate. In her capacity as real estate agent, the employee had the opportunity to solicit bank customers, use confidential information for her benefit and use the bank premises for her real estate work.

It must be said that the employee’s real estate agency business was brought to the attention of the employer because she was giving out real estate business cards right in the bank.

The court found that, given the nature of its business, the employer’s company guidelines and rules regarding conflicts of interests and competition were reasonable. The employer was able to demonstrate that the rules were in place, communicated to the employee, and consistently enforced. The employer’s request to stop the real estate business was also clearly communicated and reasonable.

What’s more, the employee’s refusal to halt her outside activities constituted disobedience with respect to work rules and the employer’s reasonable and lawful order to comply with company guidelines about outside employment. Refusing to accept her employer’s reasonable construction of its own rules was inconsistent with the fulfilment of the express terms of her own contract of employment.

As a result, the court dismissed the employee’s action against the employer.

So this is good news for employers. Even though it is understandable for employees to need or want second jobs, when those jobs conflict with the employer’s reasonable company rules, such as conflict of interest rules, the employer has the right to request that the employee quit that job. Of course, it is necessary to have evidence of the company rules, to clearly communicate the rules, and to document the employee’s disobedience.

What do you think? Was it harsh for the court to dismiss the employee’s complaint?

Would the answer change if you knew that the employee told the bank before she was promoted that she was taking real estate courses so she could take part in her family’s real estate development business? What about if you knew that the employee only worked on real estate during the weekends?

Christina Catenacci
First Reference Human Resources and Compliance Editor

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Christina Catenacci

Christina Catenacci, BA, LLB, LLM, was called to the Ontario Bar in 2002 and has since been a member of the Ontario Bar Association. Christina worked as an editor with First Reference between February 2005 and August 2015, working on publications including The Human Resources Advisor (Ontario, Western and Atlantic editions), HRinfodesk discussing topics in Labour and Employment Law. Christina has decided to pursue a PhD at the University of Western Ontario beginning in the fall of 2015. Read more
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5 thoughts on “Employer had just cause to terminate an employee who worked a second job
  • Thanks for your comment Gavin, Christina

  • Gavin Carothers says:

    I think the ruling in this case is reasonable given when the bank found out and the steps it took to communicate and enforce its policy based on conflict of interest reasons.

    If the bank knew about the employee’s 2nd job or her pursuit of furthering her education relating to real estate before she was promoted I think it would have made a difference if at that time the bank promoted her without having a discussion with her and documenting it to remind her of how her new role could conflict with her 2nd job. Good read!

  • Gavin Carothers says:

    I think the ruling in this case is reasonable given when the bank found out and the steps it took to communicate and enforce its policy based on conflict of interest reasons.

    If the bank knew about the employee’s 2nd job or her pursuit of furthering her education relating to real estate before she was promoted I think it would have made a difference if at that time the bank promoted her without having a discussion with her and documenting it to remind her of how her new role could conflict with her 2nd job. Good read!

  • Andrew,

    Thanks for your comment. I think that many problems in employment can be prevented with proper communication. This case is just one example…

    Christina

  • Andrew says:

    Great example of the employer’s right to create and enforce policy. Also, a great lesson to employers how important it is to communicate those policies clearly to employees if you expect the courts to back you up!
    Another interesting perspective of this situation is that from the folks that licence real estate agents. This person may have found herself in hot water from them had she not lost her job at the bank first.