Not blowing the whistle on theft constitutes just cause for dismissal

|Canadian Employment Law Today

Houlihan v. McEvoy, [2002] B.C.J. No. 8 (B.C.S.C.)

Houlihan was employed by McEvoy for 20 years when her employment was terminated for cause. She started an action for damages for breach of her employment contract and wrongful dismissal. Houlihan had discovered the theft of money from the employer by other employees, but because she was unable to determine exactly who had committed the acts of theft she decided not to inform her employer, choosing instead to implement various procedures to prevent future losses.

The court held Houlihan’s decision to not inform her employer of the thefts constituted just cause for dismissal. Her failure to report the loss of money was a form of dishonesty which amounted to a breach of the implied duty of faithfulness and honesty she owed her employer. The court found that by remaining silent she had subordinated her obligation to McEvoy in favour of protecting other employees.