HomeMy WebLinkAbout1979-0148.Pfeffer.80-04-14 Decision.1 I 11. •IIII 1 AA
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GRIEVANCE
SETTLEMENT
BOARD 143/79
It LIMON( Ili/Yid • Ofdlti
Between:
IN THE MATTER OF AN ARBITRATION
Under The
CROWN EMPLOYEES COLLECTIVE BARGAINING ACT
Before
THE GRIEVANCE SETTLEMENT BOARD
Mr. J. Pfeffer (Grievor)
Before:
For the Grievor:
For the Employer:
And
The Liquor Control Board of
Professor K. Swinton
Mr. A. Fortier
Mr. W. Walsh
Mr. M. Green
Golden-Levinson
Mr. R. Dramd
Hicks, Morley, Hamilton
Ontario (Employer)
Vice-Chairman
Member
Member
Hearing:
February 20, 1980
Suite 2100, 130 Dundas St. West
Toronto, Ontario
This is a grievance in which Joseph Pfeffer claims that he
has been unjustly discharged by his employer, The Liquor Control
Board of Ontario, for failure to obey Board policy with regard to
the treatment of void cash register receipts.
The griever, Pfeffer, was employed as a Clerk 3 by the LCBO
until his discharge. He is 25 years of age and married and the
job at the LCBO was his first full-time job. His seniority dates
from November, 1975.
The incident giving rise to the discharge occurred on April
4, 1979. On that day, Pfeffer was acting as relief cashier at the
Summerhill Store (Number 10). Summerhill has been a self-serve
store since December, 1978, and the grievor has worked there since
he started with the LCBO. Prior to that date, he worked part-time
while a student. As relief cashier, he was required to take over
cashier's duties during the lunch hour and dinner breaks of the
other employees.
A cashier is given a $50 float to start each day. At the
end of the day, he "rings off" his machine, totalling the amount
tendered in the transactions of that day. The employee then takes
the cash register tape and his cash to the Bookkeeper. The $50
float is separated and the Bookkeeper counts the remaining cash.
The amount of cash plus the amounts from "voids" should equal the
total shown by the ring-off. "Voids" are cash register receipts
from transactions which have been voided because of employee error.
1
Board policy with regard to void sales is contained in a
circular sent to all stores dated May 30, 1978 and kept in the
Store Operation Manual (Ex. 7). It states that if an employee
makes a mistake in ringing up an order (for example, by charging
the incorrect price for a bottle of liquor), it is Board policy
that the employee summon the Manager or Assistant Manager to come
to the cash register and initial the cash register receipt. The
employee also initials the receipt, which is now called a "void."
The employee is then to ring through the transaction properly.
If he has done so, at the end of the day, he would be short in his
cash unless he were to receive some sort of credit for the voids.
To prevent this, the practice for balancing is as outlined above -
the Bookkeeper totals the cash'in the drawer plus the voids.
Together they should equal the sum on the tape.
On April 4, 1979, when the Bookkeeper, Jeff Nester,
counted the grievor's cash and added in the total of seven voids
claimed (Ex. 6),he found that the grievor was $39 short of the
cash register tape sum of $1,632.52 (Ex. 5). It is Board policy
that an employee must pay part of the losses which he incurs while
on cash. The Board pays the first $2.00, while the Board and the
employee share equally the remaining shortage. In the case of a
$39 shortage, the grievor would have to pay $18.50.
Nester told the grievor of the shortage, and Pfeffer said
that the whole thing should be left until the next day, when he
would take care of it. Pfeffer stated in his testimony that he
- 4
had been ill with bronchitis all week and was in a hurry to get
home. A doctor's certificate (Ex. 11) appears to confirm that he was ill at
the time. At that time, Russell MOrrison, the Assistant Manager,
told the grievor that the particular cash register was not needed
that evening and that he and Nester would clear the machine and
check the tape to see if they could find any discrepancies to
account for the shortage.
That evening Morrison checked the tape and, while doing so,
found several places where the grievor had claimed credit for a
void, but had not rung the customer's order back in after the void.
Of the seven voids for which credit was claimed, to a total of
$187.77, only two were rung back in. These two (numbers 6 and 7
on Ex. 8) were for $39.85 and $27.00 respectively, for a total of
$66.85. From their position on the tape, they occurred near the
end of the day. The other five voids, totalling $120.92, were
not rung back in. Correcting for those errors on the voids for
which money would not have been received (for example, when the
grievor twice punched $20 for tax, rather than $20 to show the
amount tendered) the value of the merchandise on those five voids
was $78.80.
Morrison was disturbed by the finding and informed R. J.
Ford, the Store Manager. They met with the grievor and Mr. Scowcroft,
the District Supervisor, on April 6. Ford asked the grievor for an
explanation for his failure to ring in the five voids. The response
was that the grievor did not know and could give no explanation.
On beiny asked ayin, with the assurance that this was a serious matter,
Pfeffer asked Ford if he wanted the resignation of the grievor. Ford
replied that all he wanted was an explanation. When that failed to
materialize, he suspended the grievor for one day, charging him with •
violation of Board procedures and notifying him that he had three days
to give an explanation by registered letter to Mr. W. D.McLeod, Director
of Store Operations.
The grievor's letter (Ex. 12) reiterated his inability to explain
the discrepancy in his cash and expressed his wish that further investi-
gation would lead to the discovery of an explanation. Subsequent to this
letter, the grievor was discharged on May 19, 1979.
It is the contention of the employer that the grievor was justly
discharged for failure to abide by an important Board policy, namely
re-ringing voided transactions. Failure to do this, coupled with taking
credit for five voids that were not re-rung and his inability to give an
explanation for the discrepancy in his cash, gave rise to an inference of
untrustworthiness, justifying discharge.
The union has argued that there was no just cause for discharge on the
basis that there is no onus on the grievor to explainIthe discrepancy. It
was argued that management was alleging theft and had failed to substan-
tiate its allegation or the basis of proof beyond a reasonable doubt.
If the employer had been alleging theft, it is doubtful that it
would succeed in this case. The burden of proof on an employer in cases
in which criminal or quasi-criminal conduct is alleged is not on the basis
of a balance of probabilities. Rather the employer must provide "clear and
convincing proof" of such conduct (Re Toronto Hydro Electric System (1978).
29 L.A.C. (2d) 252 (Konnedy); Bernardi and Liquor Control Board of Ontario
102/79 at 22). In this case the evidence would not support an allegation
- 6 -
of theft. On being accused of stealing cash from. his drawer during
cross-examination, the grievor twice denied it.
The employer does not, however, base its decision to discharge
on an accusation of theft. Rather, its case rests solely,on breach
of the Board's rules. Discharge is alleged to be justified because
of the importance of the rule to the protection of the employer's
cash system and the inference of untrustworthiness caused by the
breach. Normally, a cashier's tapes are not checked. If the employee
rings off correctly and the cash plus voids balance, the tape is not
checked to ensure that voids are properly re-rung.
This is significant, if the nature of the voids is considered.
When an employee is credited with a void, it is equivalent to giving
him cash. If he actually sold the goods which were the subject of
the void sale, received cash for them, and then did not re-ring the
sale, the credit for the void should put him in an overage position
when his "cash" (voids plus actual cash) are matched against his cash
register tape. If a void has not been re-rung and the cash plus voids
balance with the tapes, the employer might well be concerned that there
has been some misappropriation of cash.
Because of this concern about the possibility of employee
dishonesty if voids are not handled properly, the Board chose to
discharge the grievor. In the absence of some explanation as to why
the grievor had not re-rung five voids credited to him (for example,
because the customer changed his mind and decided not to buy the
liquor), the Board felt that the grievor's conduct gave raise to an
inference of untrustworthiness.
•II 7
There is no doubt that employee honesty is important to all
employers. To quote from Re Phillips Cables Ltd. and Int'l Union of
Electrical, Radio and Machine Workers, Local 510 (2974), 6 L.A.C. (2d)
35 (Adams) at 37 -
"...honesty is a touchstone to viable employer-
employee relationships In other words,
employee good faith and honesty is one important
ingredient to both industrial democracy and the
fostering of a more co-operative labour relations
climate."
The words are particularly appropriate in circumstances in which the
employee is entrusted with the handling of cash, particularly where
the employer cannot provide constant monitoring of the employee's
conduct. Therefore, employee honesty has been described as the most
important aspect of his or her duty to the employer, and for many years,
proof of theft of company property or that of other employees was automatic
grounds for discharge (Brown & Beatty, Canadian Labour Arbitration at 313).
There has been a lessening in the rigidity of that position in
recent years, with some arbitrators showing a willingness to consider
the employee's ability to correct his conduct in the future and to
provide honest service to the employer despite some act of dishonesty
(Re Phillips Cables, supra, Re Toronto East General Hospital Inc. and
Service Employees Int'l Union (1975), 9 L.A.C. (2d) 312 (Beatty);
Haight 6 Ministry of Government Services, 23/75; Cranley and Staunton
and ministry of Revenue, 48/76; 49/76). Nevertheless, these employees
have still been subject to heavy penalties and lengthy suspensions in
order to emphasize the gravity of the offence to the grievor and to
those who might be tempted to duplicate the conduct.
While it is not alleged that the grievor actually stole money
from the Board, it is argued that his conduct has given rise to an
inference of untrustworthiness because of his failure to explain why
he took credit for the voids. Usually in discipline cases, the onus
is on the employer to prove just cause. However, there may be circum-
stances when the onus shifts to the employee to give an explanation
for his conduct. Arbitrators have been reluctant to specify general
rules as to when an employee should be required to give an explana-
tion, for this type of rule might well conflict with other important
values, such as the right to protection against self-incrimination
in criminal cases (Toronto East General Hospital, supra, at 316).
Nevertheless, several arbitrators have held that in some circumstances,
an employee is required to give an explanation: Re Polymer Corp. Ltd.
and Oil, Chemical & Atomic Workers, Local 9-14 (1973), 4 L.A.C. (2d) 148
(Palmer); Re United Automobile Workers of America/ Local 397 and Brantford
Cordage Co. (1969), 20 L.A.C. 412 (Ranrahan); Re Toronto East General
Hospital, supra,. In the last-mentioned case, Professor Beatty
emphasized that the duty of explanation arises only in "extreme
circumstances" and discussed the rationale for the duty as follows
(at 315) -
"Very simply, and in sharp distinction to the
criminal law context, we are here concerned with
9
an employment relationship the continuation of
which, to a larger degree, is premased on the
good faith, mutual trust and respect of the
parties to this relationship."
It should be noted, as well, that even where a duty to explain arises,
arbitrators have been reluctant to generalize about the type of
explanation required (Re Int'l Chemical Workers Local 279 and Rexall
Drug Co. Ltd. (1967), 18 L.A.C. 342 (Weather111)).
With these considerations in mind, it is necessary to evaluate
the circumstances of this case. There is no doubt, on the evidence,
that the grievor failed to follow Board policy with regard to the
voids. According to that policy (Ex. 7), he should have had the
voids initialled at the time at which they occurred. Because the
day in question was one on which stock was arriving, there were times
when no one was in the office to initial voids. The grievor, therefore,
had the wine consultant take two voids in for initialling after the
transactions.
More important than the possible irregularity in obtaining
initials is the failure to re-ring five of the voids and, later, the
obtaining of credits for those voids. The failure to re-ring is clearly
in conflict with the Board policy. From the evidence, it appears that the
grievor was familiar with this policy. The final two voids in the day
were properly re-rung. All the voids were initialled by Pfeffer and by
another employee. The grievor also testified that he was familiar with
the policy on voids, although he had not been on cash for one month while
he was taking office training. Therefore, it would appear that Pfeffer
knew the policy and did not follow it.
- 10 -
This is a cause of concern for the employer', in light of the
importance of that policy to its operations. Added to that is
Pfeffer's use of five voids which were not properly re-rung. Pfeffer
testified that he realized the significance of the voids - that they
were a credit similar to cash.
It must then be asked whether he had an obligation to explain to
the employer why he used the five voids which were not properly re-rung,
especially on an occasion when his cash was already out $39. In
the circumstances of this case, it was not unreasonable for the
employer to ask the employee for an explanation of his conduct,
for it can be inferred that the employee took credit for something
for which he should not be credited. In these circumstances, the
employee can be asked for an explanation, for he is in a position to
know what might have happened - for example, a customer did not take
the goods originally brought to the counter.
However, even if the employer had the right to ask the grievor
for an explanation, was it justified in discharging him when no
adequate explanation was forthcoming? This is a difficult question
to answer in this particular case, for no one, employer or employee, has
come up with any explanation as to what had happened to put the cash
out $39, and there are competing inferences which can be drawn from the
evidence.
The grievor on the day of the incident was feeling quite ill,and a docto,"
letter indicated that he was ill enough to have been off work on the day after
the incident. This might well have affected his concentration and memory
I I -
with regard to the transactions and, therefore, his ability to give
an explanation. Certain aspects of his behaviour do not indicate
blameworthy conduct. For example, when told that he was $39. short
and that Morrison and Nester would check the tape, he made no effort
to stop them, for example, by offering to pay his $18.50 share then'.
Furthermore, the grievor has been regarded as likable and a fair worker
by Ford, the Store Manager. Ford also expressed surprise at the event
and said that he believed Pfeffer did not know why the cash was out.
These factors can give rise to an inference that the grievor did not
have any explanation for the discrepancy or the credits for the voids.
In finding that the employee has a duty of explanation to the
employer, the arbitrator should be wary of shifting the onus to the
employee to prove his innocence. He may well not know why certain
events occurred and he may well not be blameworthy.
The Union has argued that in cases where neither side can explain
what has occurred, it would be improper to apply the rule that, in the
absence of a satisfactory explanation, the onus is on the employee. We
would agree that care should be taken that the employee not be required to
prove his innocence. If the arbitrator believes that the employee honestly
has no explanation, it should be reluctant to uphold the discharge of the
employee.
Nevertheless, there may be some limited circumstances where the
absence of explanation gives rise to cause for discharge (Re Sterling Actions
& Keys Ltd. (1952), 3 L.A.C. 1.105 (Cross)). In a decision of another
panel of this Board, Bernardi and The Liquor Control Board of Ontario,
102/79, an employee who failed to comply with Board policy regarding
separate cash drawers was held to bear added responsibility because this
breach made it impossible for the employer and the Grievance Settlement Board
to determine who was responsible for falsifying records regarding store
productivity. The employee in that case was manager of the store and
directly responsible for implementing the policy which would have led
to an explanation as to the person or persons responsible for the falsi-
fication.
The present case is different from the Bernardi case. In this
case the grievor asserted that he had no explanation and hoped that
one could be found. Various theories could be constructed to explain
the shortage and the voids, and the employee's conduct is not necessarily
blameworthy, as in Bernardi, for it is not his conduct alone that has
stymied the employer and this Board in discovering the reason for the
shortage. In light of the evidence and the possibility that the grievor
is unable to explain the discrepancy, we are not prepared to conclude
that the grievor should be discharged for failure to provide an explana-
tion. The onus to prove misconduct remains on the employer.
However, that conclusion does not resolve a central problem in
this case, and that is the significance to be attributed to the failure
to follow Board policy regarding void sales by not re-ringing voids and
by accepting credits for such voids. This policy is an important one,
known to the grievor. The employer must ensure that employees abide by
it in order to protect the integrity of its cash system. Therefore,
breach of the rule is a serious infraction, whether or not there is
dishonesty associated with the breach, and constitutes conduct which is
deserving of discipline. The employees on cash are in a position of trust,
they are bonded, and they must be careful to comply with the employer's
control system. Therefore, the employer must be concerned about
emphasizing the importance of this policy to all employees, so that
general deterrence is a major factor entering into the assessment of the proper
penalty for breach of this rule. In addition, the employer must be concerned
about the trustworthiness of any employee who breaches such a rule and
the ability of this employee to perform in a.trustwOrthy manner in the
future..
While this Board is concerned abput the gravity of the breach of
the employer's policy on void sales, we are not prepared to conclude
that the grievor should be discharged. The grievor has been a good
employee for several years and has no prior disciplinary record.
We arc not convinced'that Mr. Pfeffer is an untrustworthy employee, and,
as has been stated in Re United Automobile Workers, Local 127 and Ontario
Steel Products Ltd. (1962), 13 L.A.C. 197 (Beardall) at 199 -
"If there is any reasonable doubt as to the
adequacy of the punishment, 2 think that the
grievor should be given the benefit of the
doubt."
To uphold the discharge would leave the grievor's reputation under a
cloud, because of the implication of dishonesty, when dishonesty has not
been proved.
Nevertheless, the grievor has been guilty of grave misconduct.
It must be emphasized to him as well as to other employees that failure
to abide by the employer's void policy cannot be tolerated, for the
integrity of the cash system is central to the employer's operations.
Breach of the void policy must then be grounds for severe penalty. In the
circumstances, a lengthy suspension will serve to emphasize these ends
of deterrence, both general and specific. Previous decisions of the Board
have imposed suspensions of approximately five months and four months for
isolated acts of dishonesty (Haight, Cranleg/ supra) and a recent decision
in the private sector, Re Canadian Broadcasting Corp. and CanAdian Union of
Public Employees (1980), 23 L.A.C. (2d) 227 (Aathurs) imposed a five month
suspension plus reinstatement to a different job in circumstances of untrust-
worthiness similar to these.
44. - 14 -
Here, while dishonesty is not proved, breach of an important
rule indicating lack of trustworthiness has been proven, and we would
regard the offences as similar in gravity. Therefore, pursuant to 5. 18(3)
of The Crown Employees Collective Bargaining Act, 3.0. 1972, c. 67 as am.
we would allow the grievance and order the following: (1) that the grievor
be reinstated forthwith; (2) that a five-month suspension be substituted
for the discharge.
We will make no award as to compensation at this time. Should
the parties be unable to agree on compensation, the Board will retain
jurisdiction to deal with problems arising out of implementation of
the award.
Dated at Toronto this 14th day of April 1980.
/at
6.16 4.1""lias
Professor K. Swinton Vice-Chairman
I concur
A. Fortier Member
I concur
W. Walsh
Member