Subscribe to our newsletters
Cavendish Manor Retirement Home v Niagara Health Care and Service Workers Union
Allegations of time theft or fraud are among the most serious an employer can level, and that is exactly why they carry real risk if they are not handled properly. A recent Ontario grievance arbitration, Cavendish Manor Retirement Home v. CLAC, Local 302, shows what happens when an employer acts on a time theft suspicion without clear evidence or a fair investigation. The arbitrator overturned the discharge of a long-service dietary aide, found no evidence of fraud, and ordered the employer to pay termination entitlements under the Employment Standards Act, 2000. The lesson is not that dishonesty cannot be disciplined; it is that proving it takes evidence and process, not assumption.
The case also shows that process failures have a price even where reinstatement is not in play. Because the union did not seek reinstatement, the arbitrator did not return the employee to work, but the employer was still ordered to pay her ESA termination entitlement. Skipping the investigation did not avoid liability; it created it.
Considering discipline or discharge for suspected time theft or dishonesty?
These allegations require clear evidence of intent and a documented, fair investigation. Acting on suspicion alone is how a discharge gets overturned and an award follows. Get advice on the evidence and the process before you act.
Call: 1-800-771-7882 Review My Discipline ProcessBackground: a sign-in sheet and a rushed conclusion
The employee was a dietary aide with five years of service. She was dismissed after the employer concluded she had falsified her sign-in sheet for three January 2025 shifts, treating it as an attempt to record hours she had not worked. The employee's account was different. She had been granted approved lieu days and a statutory holiday for those dates, and said she filled out the sheet the way she did only to make sure she would be paid, given past payroll problems.
The arbitrator found the employee's version held up. She had in fact been granted the lieu days and the statutory holiday, the posted schedule confirmed she was not expected to work those shifts, she had never been told how to properly record such days on the form, and no investigation or meeting was held with her before the employer terminated her employment.
What the arbitrator decided
No evidence of fraud
The arbitrator concluded there was no evidence of an intent to defraud. The conduct was described as an innocent, perhaps naive, attempt to ensure the employee was properly paid. Without proof of dishonest intent, the foundation for a discharge for time theft simply was not there.
No investigation before dismissal
The employer terminated the employee without interviewing her or clarifying the disputed sign-in sheet. Arbitrators expect a fair investigation before discharge, and that expectation is heightened, not lowered, when the allegation is something as serious as dishonesty.
Unclear record-keeping instructions
The employee had never been shown how to record lieu days and a statutory holiday on the sign-in form. Ambiguity in the employer's own record-keeping procedures undercut the claim that the entries were a deliberate falsification rather than an honest mistake.
A remedy even without reinstatement
Because the union opposed reinstatement, the arbitrator did not order the employee back to work, but upheld the grievance and awarded ESA termination pay equal to five weeks' wages, totalling $3,497. The flawed process produced a payable liability regardless of reinstatement.
"Allegations of time theft can be costly and complex, and mishandling them may expose employers to legal risk. Speaking with a labour lawyer before taking action ensures your decisions are fair, defensible, and legally sound."
Christopher Achkar, employment lawyer and founder of Achkar Law
Key lessons for Ontario employers
Investigate before you discipline
Interview the employee, put the discrepancy to them, and let them explain before deciding on discipline. A discharge imposed without that step is exposed on judicial or arbitral review, even when the underlying allegation is serious. The investigation is not a formality; it is often the difference between a defensible decision and an overturned one.
Make timekeeping rules clear and explicit
Employees need to know how to record lieu days, statutory holidays, and unusual situations on your forms. If your own procedures are ambiguous, an incorrect entry looks like confusion, not fraud, and that ambiguity will be held against the employer rather than the employee.
Be careful with the time theft label
Calling conduct time theft or fraud raises the evidentiary bar you have to meet. You need clear and convincing proof of an intent to deceive. If what you actually have is a mistake or a misunderstanding, framing it as dishonesty will weaken your position, not strengthen it.
Plan for the remedy, not just the decision
Even where an employee is not reinstated, an arbitrator can order ESA entitlements or other compensation for a flawed process. A poorly investigated termination can cost money and credibility in future disputes, so weigh the remedy exposure before you act.
Document policies, training, and the file
Keep current written policies on timekeeping, lieu days, and statutory holidays, train managers on investigation procedures and documentation, and build a clear file as events unfold. A contemporaneous record is what lets you show a fair process after the fact.
Get legal advice before discharging for dishonesty
Before terminating for time theft or any form of dishonesty, get advice on whether the evidence supports the allegation and whether your process will hold up. These are exactly the cases where a short conversation before acting prevents a costly award afterward.
Would a discharge for misconduct survive arbitration in your workplace?
Cavendish Manor shows that the answer turns on evidence of intent, a fair investigation, and clear policies. A proactive review of your discipline and investigation practices is far cheaper than an overturned termination.
Book a Compliance Review Or call us: 1-800-771-7882How Achkar Law helps employers
Achkar Law advises employers across Ontario on discipline, discharge, and grievance arbitration. We help unionized employers build defensible policies, conduct fair and well-documented investigations, assess discipline and termination decisions before they are made, and manage grievance and arbitration disputes effectively.
Related resources
For how an employer's duty to investigate plays out under the OHSA, see our summary of Metrolinx v. Amalgamated Transit Union, Local 1587 (2025 ONCA 415).
For support with discipline, investigations, and compliance, see our labour law services.
Call us at 1-800-771-7882 for a confidential consultation.
The article in this client update provides general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Achkar Law Professional Corporation and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Achkar Law Professional Corporation. ©