HR Heartbeat: Fired for malicious gossip, overtime disputes and…

Welcome to HR Heartbeat, where we take a look at the week’s most pressing HR and employment law stories. With over a decade of experience working within the HR and employment law industry, I give my opinion on current trends impacting your business, as well as my own personal commentary on all things HR and legal.

Is ‘gossip’ enough reason to terminate an employee?

A recent case from Saskatchewan makes one thing clear to employers. If a worker reports possible intoxication at work, treat it as a priority and investigate. Even if there's no hard evidence.

In this case, an employee confidentially raised concerns about a supervisor’s possible drug use at work. Instead of investigating, the employer accused the worker of “malicious gossip” and fired them. They were later fully reinstated with full compensation after a wrongful dismissal suit.

Here’s what employers can learn from this ruling.

• You don't need concrete proof to investigate; reasonable concern is enough.

• Always investigate when workers raise concern.

• Make sure there are no policy gaps. Every workplace should have impartial reporting channels and well-communicated procedures.

• There's a high bar for proving “malicious gossip”. To prove malice, you must be able to show intent to harm, not just that the concern turned out to be wrong.

All the above point to one thing. Whenever there's a workplace incident, investigate first. Acting on assumptions or hearsay exposes your business to legal risk, damaged trust, and costly claims.

Failing to job hunt after termination could affect severance

A recent Alberta decision is a reminder that long tenure doesn't always guarantee a hefty severance package, especially if the worker doesn’t try to find a new job.

In this case, a receptionist who worked one day a week for 14 years sought damages for pay in lieu of notice, lost benefits, and punitive damages after termination, claiming long service and age entitled them to a much longer notice period.

Evidence showed she waited months to start a job search, sent only a few generic applications, and refused to explore similar roles that didn’t perfectly match her old schedule.

Meanwhile, the employer showed there were over 100 comparable admin jobs posted during the notice period and the employee only applied for a few.

The court agreed with the employer and her reasonable notice period was reduced, with no punitive damages awarded.

Overtime dispute gone wrong

An employer in B.C. must pay more than $45,000 in unpaid overtime plus punitive damages after a court found it tried to intimidate a worker for asserting their rights.

The worker, an engineer, often worked 12–16-hour days on major field projects. While engineers in B.C. are exempt from overtime under employment standards, the employer had a written overtime policy that promised time-and-a-half pay after 8 hours and double time pay after 12 hours, making overtime a contractual entitlement.

After a few months, the employee realized hundreds of overtime hours hadn’t been paid. They raised the issue with management, and the company admitted to owing, promising to pay all allotted hours. But, they wound up only paying regular pay instead of overtime rates and left more than 260 hours unpaid.

The company terminated the employee, offering to pay their remaining overtime rates if they signed a release agreeing to payment on a 'gratuitous basis.' The worker signed the letter, but the company again only paid regular rates.

When the worker sued for unpaid wages, the employer filed a counterclaim accusing them of misconduct. The court found their claims "meritless and made in bad faith,” noting the employer tried to use litigation to bully the worker.  The employee was awarded additional punitive damages even though they originally didn't file for them.

This kind of ruling is extremely rare and makes it clear that overtime policies are binding. It's also crucial to avoid using intimidation when handling employee claims, as retaliating against employees who raise issues can seriously backfire.

And that’s a wrap from me. Tune in next time for my take on the latest headlines and employment law stories, helping keep your business ahead!