By Mark Colavecchia and Derek Knoechel
In June 2003 George Radwanski, Canada’s federal privacy commissioner, resigned three years into his seven-year term amid parliamentary inquiries into travel and hospitality expenses. Several months later, the auditor general released a report leading to a lengthy police investigation of Radwanski’s expense claims.
In March 2006, the former privacy commissioner was charged with fraud over $5,000 and breach of trust. The fraud charges stemmed from a $15,000 travel advance, while the breach of trust charges arose from contraventions of policies governing federal public office holders.
On February 13, 2009, Radwanski was acquitted of all criminal charges. He had testified that he’d requested the travel advance on the recommendation of senior officials at his commission. He also claimed that the remaining expenses were legitimate. He denied that he had directed anyone to act in violation of government policies.
The trial judge clearly struggled with the decision, noting that it was “an understatement to say that Mr. Radwanski was less than meticulous and careful in his record keeping relating to expenses he incurred while travelling.” The judge also observed that Radwanski should have recognized that his record-keeping practices were deficient and corrected them. However, these failures were not enough to justify branding him a criminal. There was at least a reasonable doubt that Radwanski possessed the intent necessary to be found guilty.
The facts in the Radwanski case raise an interesting question for employers: Would there have been just cause for termination of employment in a civil lawsuit? This hypothetical question and the following discussion deliberately ignore the fact that public office holders often have additional procedural protections by virtue of their office, but the answer to the question is: Perhaps.
In a case involving allegations of dishonesty or deceitful conduct, an employer must first establish deceitful conduct on the part of the employee. Next, the employer must establish that the nature and degree of the dishonesty engaged in by the employee warrants dismissal. The test is whether the employee’s dishonesty goes right to the heart of the employment relationship and gives rise to its fundamental breakdown.
In cases involving breach of policy, employers must establish that the employee was aware of the policy and the consequences of its breach. They must also establish that the policy was consistently enforced. From the trial judge’s comments, it appears that the employer might have had problems meeting this test in this case.
For example, the government failed to prove that Radwanski was familiar with the specific terms of the applicable expense policy. The judge accepted Radwanski’s testimony that he relied upon “administrative experts” in his office for advice regarding such policies. The judge also observed that Radwanski had little experience in administrative matters.
Of course the standard of proof in a civil employment termination case is significantly lower than the criminal standard. Merely raising a “reasonable doubt” is not sufficient for an employee to avoid a finding of just cause. The employer need only present “clear, convincing and cogent” evidence to support its allegation “on the balance of probabilities.”
Also of note is the fact that Canada’s Parliament had found Radwanski in contempt for providing it with misleading information about his spending. This did not seem to factor into the criminal case. But in a civil employment case, an employee’s conduct during the course of an investigation may itself give rise to just cause for termination even where the initial misconduct did not.
Lessons to be learned
Following his acquittal, Radwanski told reporters that he believed that there were things he could have done differently, such as paying more attention to the administrative side of the operation. Ironically, had the government taken greater steps to ensure that Radwanski paid more attention to these details, his defense may have been less likely to succeed at trial.
The Radwanski case illustrates the importance of ensuring that policies are distributed throughout all levels of an organization and not just to administrators. This will not only encourage increased compliance but will also make it easier to establish just cause should an employee engage in inappropriate transactions.
Employers are advised to take steps to ensure that policies regarding proper expenditures and expense claims are implemented, distributed, and consistently applied throughout their organizations. They should be reviewed with employees on a regular basis, with those reviews being documented and acknowledged in writing.