Sex in the Workplace Is Not Always Cause for Dismissal

It may be surprising to some, but sex in the workplace is not always sufficient cause for dismissal. In a Federal Court of Appeal decision (Payne v. Bank of Montreal, 2013 FCA 33), an employee's dismissal for sex in the workplace was held to be unjust.

In September 2008, an employee of BMO was suspended pending an investigation into a harassment complaint, after which he was disciplined. Two months later, in November 2008, the employee was suspended and investigated for behaviour towards his assistant manager. BMO had learned that the employee and assistant manager had engaged in a consensual sexual relationship on bank premises during and after business hours. This relationship had continued after the discipline for the harassment complaint. Also, BMO learned that the employee had discussed the first investigation which was a breach of confidentiality.

BMO dismissed the employee for breaching confidentiality; acting inappropriately on bank property during and after business hours; and breaching BMO's Code of Conduct. The employee filed an unjust dismissal complaint. An adjudicator found that the employee had been unjustly dismissed and ordered reinstatement.

BMO applied for judicial review of the adjudicator's decision. On the judicial review, the Federal Court disagreed with the adjudicator, deciding that the employee was neither unjustly dismissed, nor worthy of reinstatement. The employee appealed, and in a unanimous decision, the Federal Court of Appeal allowed the appeal and held that he had been unjustly dismissed. The employee received compensation together with interest and costs.

It is clear from cases like this, that dismissal for cause will rarely be found to be just in the absence of progressive discipline for similar misconduct.