Time Theft: Apparently it is alive and well in Canada.  What is it?  Time theft is a fraudulent act where an employee collects pay for time not actually worked.  When there’s evidence that an employee has intentionally falsified a time card or had a co-worker ‘punch in’ for him, terminations are not unusual.  This blog reviews recent developments on the issue.

  • In January 2013, 29 employees of the City of Hamilton Public Works Department’s Road Division were terminated for time theft.  The employees were tasked with fixing roadways, but were instead dumping city asphalt and tending to personal matters during working hours.  In May 2013, five Supervisors from the same department retired or resigned, and nine more face unpaid suspensions.  You can read more about what happened in the City of Hamilton matter here.
  • In Prince Albert, Saskatchewan, City Council is considering tracking city workers through the GPS devices in their phones due to concerns over time theft.  In a Council decision dated Monday, May 13, 2013, the Council told city Managers to consult with the Unions before they would approve the tracking plan.  More on this here.

These events raise two questions:

  1. When can you terminate an employee for time theft? and, 
  2. In what ways can you monitor employees to ensure time theft is not occurring?

Fewer cases have been seen as workplaces move toward more flexible schedules and productivity-related performance measures.  Recently, in Andrews v. Deputy Head (Department of Citizenship and Immigration), 2011 PSLRB 100 an arbitrator overturned the termination of a government employee who spent half his workday sitting at his desk, surfing pornography on the Internet.  The employee was terminated for time theft.  His defence was that he was present in the office and not required to account for his time in the office and no performance issues about his work had been previously raised. The Arbitrator found that while his behaviour was disciplinable, the employee could not be terminated for time theft because he had not falsified any records or made any inaccurate or misleading comments to his employer about the use of his time.

The terminations in Hamilton, which are in the process of being grieved by the employee’s union, C.U.P.E. Local 5167, may stand if the employer can prove the employees were intentionally misleading the employer about the work they were completing and the time needed to do so.

In a recent British Columbia arbitration decision, Surrey (City) v. C.U.P.E., Local 402, the Arbitrator upheld the termination of a By-Law Enforcement Officer who took extended time for lunch and breaks.  A long service employee was going to the gym for approximately 60 minutes each day, in addition to taking his mandated morning and lunch breaks.  The employee claimed he made up the time by coming in early or staying late to inspect and clean his vehicle, but did not clock in during these times.  The employee also claimed he skipped the 10 minute afternoon break to which he was entitled.

The Arbitrator gave the grievor the benefit of the doubt and credited him with an extra 15 minutes in the morning and the 10 minute afternoon break.  However, after reviewing GPS data from the vehicle and FOB data showing when the employee entered and left the workplace, the Arbitrator concluded that there was no way the employee could have reasonably believed he was making up the time. While he had not outright lied during the investigation, he had been misleading about his activities and about his efforts to make up the time.  Given that the position was unsupervised and required significant trust, given the grievor had one previous discipline for time theft, and given that the employer had made its policy on lunch and break times well known, the arbitrator found termination was warranted.

Employee Monitoring

In December, 2012, the decision of a British Columbia Information and Privacy Commissioner in Schindler Elevator Corporation, held that an employer could use GPS and engine status data for effective management of employees.  The employees in the Schindler case repaired elevators and responded to elevator emergencies.  They worked from home, drove a company vehicle home each night and departed from home the next morning directly to work sites.  The Union argued that the employer was collecting and using personal information contrary to British Columbia’s Personal Information and Protection of Privacy Act.  However, the Privacy Commissioner found that the purpose of that Act is to balance the interests of protecting personal information and permitting the use of personal information by organizations for purposes that are appropriate in the circumstances.  Given the conditions under which the employees worked and the difficulty of monitoring them,  the employer was justified in relying on the GPS information during the case of investigations into employee behaviour, including time theft.  While definitions of personal information and statutes relating to privacy differ by jurisdiction, this British Columbia decision is different than previous decisions where other privacy commissioners have have said using GPS data was not appropriate for employee management purposes. 

What This Means to You

Time theft is serious.  Where dishonesty can be proven, termination may be appropriate. The extent of the time theft, the employee’s remorse, the employee’s history of similar discipline, the employee’s length of service and a myriad of other factors also influence whether termination is reasonable.

There is still debate on how, when and for what purposes employees can be monitored using electronic devices such as a GPS system.  Where an employer has legitimate reason to believe that time theft is occurring, using existing monitoring systems for the purpose of monitoring employees might be reasonable – but be prepared to defend your decision to use GPS.