Every good relationship is built on a bedrock of trust and loyalty.
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While the strength of employer-employee relationships waxed and waned over the pandemic, the same principle applies. Successful, strong workplace connections are bound by implicit fidelity, honesty and trust.
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In fact, this expectation is so ingrained in the fabric of employment relationships that the law sees it as an implicit term of every employment agreement.
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It is not often that we are reminded to be truthful at work, but every once in a while there is a case that provides a stark reminder of the basic tenet.
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Todd Mechalchuk joined the auto company Galaxy Motors as its general manager in 2020. He was later promoted to president of operations.
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As president of operations, Mechalchuk had broad oversight of company operations and plenty of authority. He was highly paid, earning, at a minimum, $30,000 a month.
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As part of his role, Mechalchuk was permitted to seek reimbursement for business meals and other expenses. He submitted receipts for meals, employee events and gas.
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On one occasion, when Mechalchuk and his colleagues were dining at a restaurant called the Brew House, with their spouses, he paid the entire bill and later sought to be reimbursed by the company claiming it as a team building event. His assistant general manager, Amy Jones, rejected the business expense, feeling it was ludicrous that Mechalchuk tried to get Galaxy Motors to pay for a dinner that was not business related.
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This incident prompted Jones to look back into previous expenses Mechalchuk was reimbursed for to determine if they were indeed legitimate.
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After her investigation and subsequent questioning of Mechalchuk about his expenses, he was terminated for cause and he sued for wrongful dismissal and other damages.
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At trial, the court heard evidence about the plaintiff’s expenses including a receipt for breakfast at a restaurant, a dinner receipt, expenses for an employee event and gas receipts.
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Particularly noteworthy was the breakfast and the dinner. While the plaintiff noted on the receipts he went to breakfast with a Galaxy Motor employee, and to dinner with two other employees “Luke” and “Scott,” Mechalchuk didn’t in fact dine with employees at all.
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At trial, the court found that the plaintiff in fact dined at both breakfast and dinner with his wife Tarrah, who was also called as a witness at trial.
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Despite the plaintiff claiming he was not aware of certain policies or parameters around the expensing of certain items, the court found Galaxy Motors had cause to terminate him.
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Regarding the receipts, the trial judge wrote in part of the plaintiff: “He attempted to deceive the defendant into believing they were business expenses by writing the names of other defendant employees (Luke and Scott) for the purpose of indicating the meals had been with them when he knew it was not true.”
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Regarding the relative small amount of expenses at issue the trial judge wrote: “Although the total amount of the Parksville restaurant dinner and breakfast receipts (approximately $250) was relatively small, the misconduct went to the very root of the plaintiff’s employment relationship with the defendant.”
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This case is chock full of lessons, the most obvious being that honesty isn’t delivered in shades of gray. The facts of this case dial into the everyday issues a company comes across and the British Columbia court has confirmed that no matter how small or seemingly trivial, dishonest executive employee conduct shakes the bedrock of an employment relationship to its core.
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Practically speaking, most employers may not escalate cases like these to terminations for cause. But if they do, at least in B.C., they are on the right side of the law.
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Have a workplace issue? Maybe I can help! Email me at sunira@worklylaw.com and your question may be featured in a future column.
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The content of this article is general information only and is not legal advice.
