FPSLREB Decisions

Heard at Québec, Quebec,
March 9 to 11 and November 3 to 6, 2015, and June 14 to 17, 2016.
(FPSLREB Translation)

REASONS FOR DECISION

I. Individual grievances referred to adjudication

1        Pierre Girard (“the grievor”) held a tax auditor position classified at the AU-02 group and level with the Canada Revenue Agency (“the employer” or CRA) in the Audit division of the Eastern Quebec Tax Services Office (TSO) in Québec, Quebec.

2         In a letter dated November 18, 2013, alleging that he had breached the CRA’s Code of Ethics and Conduct (“Code of Ethics”), the employer informed the grievor that he was suspended without pay for an indeterminate period pending the outcome of an investigation. It also advised him that his reliability status was temporarily suspended.

3         On November 26, 2013, the grievor filed a grievance contesting his suspension without pay and the suspension of his reliability status. He asked that his reliability status be reinstated and that he be reinstated in his duties. That grievance was referred to adjudication on May 21, 2014 (FPSLREB File No. 566-34-9787).

4         Following the investigation and a review for cause of his reliability status, in a letter dated July 29, 2014, the employer advised the grievor that his reliability status was revoked. Then, in a letter dated July 31, 2014, it advised him that his employment was terminated retroactively to November 19, 2013.

5         On August 12, 2014, the grievor filed a grievance contesting his termination and the fact that it was retroactive to the date of his suspension. He also contested the revocation of his reliability status on the ground that it was a disciplinary action. As corrective action, he asked that his reliability status be reinstated and that he be reinstated to his duties, with salary and benefits. That grievance was referred to adjudication on December 17, 2014 (FPSLREB File No. 566-34-10455).

6         On November 1, 2014, the Public Service Labour Relations and Employment Board Act (S.C. 2013, c. 40, s. 365; PSLREBA) was proclaimed into force (SI/2014-84), creating the Public Service Labour Relations and Employment Board (PSLREB) to replace the former Public Service Labour Relations Board as well as the former Public Service Staffing Tribunal. On the same day, the consequential and transitional amendments contained in ss. 366 to 466 of the Economic Action Plan 2013 Act, No. 2 (S.C. 2013, c. 40) also came into force (SI/2014-84). Pursuant to s. 393 of the Economic Action Plan 2013 Act, No. 2, a proceeding commenced under the Public Service Labour Relations Act (S.C. 2003, c. 22, s. 2; PSLRA) before November 1, 2014, is to be taken up and continued under and in conformity with the PSLRA as it is amended by ss. 365 to 470 of the Economic Action Plan 2013 Act, No. 2.

7         On June 19, 2017, An Act to amend the Public Service Labour Relations Act, the Public Service Labour Relations and Employment Board Act and other Acts and to provide for certain other measures (S.C. 2017, c. 9) received Royal Assent, changing the name of the PSLREB and the titles of the PSLREBA and the PSLRA to, respectively, the Federal Public Sector Labour Relations and Employment Board (“the Board”), the Federal Public Sector Labour Relations and Employment Board Act,and Federal Public Sector Labour Relations Act (“the Act”).

8         For the following reasons, I find that the suspension grievance must be dismissed. The termination grievance is allowed in part, and the date of the termination is set at July 31, 2014.

II. Canadian taxpayers’ personal and confidential information

9         Some evidence presented by the parties at the hearing contains personal and confidential information on Canadian taxpayers who are not parties to the dispute. The parties asked that I not disclose the taxpayers’ names or other personal information. They also asked that certain evidence containing taxpayer information be sealed.

10        In accordance with the principle of open justice, the Board holds its hearings in public and allows the public to access its files. However, in certain circumstances, the Board may impose restrictions on access to files if it is shown that such a measure is necessary to prevent a serious risk to an important interest and that the salutary effects of the restrictions outweigh their deleterious effects (see Sierra Club of Canada v. Canada (Minister of Finance), 2002 SCC 41 at para. 53; and Canadian Broadcasting Corp. v. The Queen, 2011 SCC 3).

11        Protecting Canadian taxpayers’ information is an important interest. Section 241 of the Income Tax Act provides among other things that no official or other representative of a government entity shall “… knowingly provide, or knowingly allow to be provided, to any person any taxpayer information …” (s. 241(1)(a)), “… knowingly allow any person to have access to any taxpayer information …” (s. 241(1)(b)), or “… knowingly use any taxpayer information otherwise than in the course of the administration or enforcement of this Act …” (s. 241(1)(c)).

12        In addition, as the Adjudicator in Iammarrone v. Canada Revenue Agency, 2016 PSLREB 20 at para. 15, agreed, and as I will explain in more detail in this decision, protecting information that could identify taxpayers is aimed at the following:

… maintaining the public trust in the integrity of Canada’s tax system and ensuring tax compliance on behalf of governments across Canada, to contribute to Canadians’ economic and social well-being. I also agree that … public access to information that identifies taxpayers could seriously compromise that interest ….

13        The personal and confidential taxpayer information involved is not relevant to the case. Several exhibits entered in evidence will be redacted to maintain the confidentiality of the personal information of the taxpayers in question, while maintaining the public’s right to access them. As for evidence in which redaction is impossible due to a significant amount of personal and confidential information, it appears to me that protecting the taxpayer information is more important than the public’s right to access it. Therefore, the following documents will be sealed: Exhibit E-1, tabs 34, 43, 44, 47, and 48.

III. Summary of the evidence

14        The employer called the following witnesses: Pierre Boutin, Assistant Director, Audit division, Eastern Quebec TSO; Richard Falardeau, Team Leader, Audit division, Small and Medium Enterprise (SME) section, Eastern Quebec TSO, and the grievor’s immediate supervisor; Marie-France Leduc, Investigator, Internal Affairs and Fraud Control Division (IAFCD), CRA; Helen Brown, Director General, Internal Affairs, CRA, and CRA Security Officer; and Guillaume Donati, Director of the Eastern Quebec TSO. All the witnesses were in their respective positions at the relevant time.

15        Most of the facts in the case are uncontested.

A. The grievor’s work

16        The grievor had been employed by the CRA for 27 years and had no disciplinary file. From October 1986 to 2000, he worked in several sectors, including collections, payroll deductions, benefits and employment income audits, and individual audits. In 2001, he was appointed as a tax auditor, classified AU-01. In that position, he conducted business tax audits in the SME section of the Audit division at the Québec TSO. In 2002, he was promoted to a position classified AU-02. In it, he conducted audits of larger businesses. Beginning in 2008, he worked as an investigator/auditor for the Criminal Investigations Program. The work consisted of gathering evidence related to a taxpayer’s criminal intent for tax-evasion purposes.

17         In 2012, the Criminal Investigations Program and the Special Investigations Program were restructured. Several employees were affected, including the grievor. Many Criminal Investigations Program offices were closed. The Special Investigations Program’s finances were transferred to the SME directorate. On December 21, 2012, the grievor accepted a reasonable job offer in a tax auditor position classified AU-02 in the Audit division of the Eastern Quebec TSO. For a few weeks in January and February 2013, he took courses to upgrade on tax laws.

18        In his auditor position, among other things, the grievor had to complete files from the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) or the National Anti-Drug Strategy (NADS). Those files are about people suspected of criminal activities whom police forces were unable to prosecute. Consequently, their files are sent to the CRA for possible prosecution on tax grounds. To complete a file, auditors must carry out research using information obtained from the police or third parties to identify high-risk taxpayers and then develop an audit plan for their team leaders to approve.

19        Mr. Falardeau testified about the steps involved in preparing a normal audit file. The procedures are set out in the Income Tax Audit Manual (“the manual”).

20        Section 6.5.1 of the manual states that files are assigned to auditors by the team leader, Mr. Falardeau in this case. Section 6.5.4 details the team leader’s role in selecting files and assessing risk. Mr. Falardeau said that he controlled the inventory of auditor files and that auditors could not choose their own files. He added that a file must be in the inventory of files from FINTRAC or the NADS or linked to it. Otherwise, the auditor must discuss it with the team leader.

21        According to Mr. Donati, employees at the Eastern Quebec TSO perform only the work assigned by their team leader. He explained that in the 1990s, auditors sometimes came to the office with leads and then conducted research. However, in 2001, when he was the director of the Estrie office, the practice no longer existed. As the director of the Eastern Quebec TSO since 2006, nothing has been brought to his attention to suggest that research is conducted as it was in the 1990s. He added that auditors were prohibited from carrying out research in the CRA’s computer system, which contains confidential taxpayer information, before a file was assigned to them.

22        Auditors who have tax leads or information about an audit project must complete a form T133 (“the T133”), which the team leader must approve. Mr. Donati noted that the T133 is used when leads suggest that a taxpayer evaded taxes or participated in an underground economy. Mr. Boutin said that auditors must include as much information as possible in the T133 to open an audit file. According to Mr. Falardeau, the minimum amount of information in a T133 ensures that the auditor has not accessed the system without a reason. In addition, if auditors access the system and go beyond the information in the file, they must speak with their team leaders and add a note to justify the access.

23        When a file is assigned and research is conducted, the auditor prepares an audit plan that the team leader must review and approve. Section 9.0 of the manual indicates that the most important step at the beginning of an audit is preparing an audit plan. In addition, section 9.6.3 notes that the team leader must approve the audit plan before contacting or meeting with a taxpayer. Finally, according to section 9.11.0, the team leader must approve any change to the audit’s scope.

24        When the audit plan is approved, the auditor contacts the taxpayer to advise him or her that he or she is the subject of an audit and to set a date to meet about the audit. If the taxpayer has a representative, a form must be completed to identify and authorize the representative to act for the taxpayer. Mr. Falardeau noted that without that authorization, the CRA is not entitled to speak to or disclose information to the representative.

25        After the audit, a draft assessment is issued, which Mr. Falardeau reviews before it is sent. The taxpayer is generally given 30 days to respond and to make submissions on the draft assessment. The auditor then prepares an audit report. As indicated in section 11.6.0 of the manual, the team leader must approve the audit report. Once it is approved, the assessment is issued to the taxpayer.

26        Among the auditor’s responsibilities during this process, section 6.8.2 of the manual indicates that the auditor must report to the team leader any significant problems that arise during an audit.

27        The grievor acknowledged that the steps described by Mr. Falardeau apply to audit files.

B. The circumstances that led to the suspension

28        On May 10, 2013, the grievor took part in a regional union council as a union representative. During the evening, he spoke with a former union member who was also a former CRA employee. He informed the grievor that he represented taxpayers with foreign investments and that they wanted to disclose unreported income, to settle their tax affairs. The grievor told him that he worked on FINTRAC, NASD, and foreign tax files for all of Quebec. He told the grievor that he would visit him over the summer to further discuss those files .

29        The grievor saw the potential for developing files on the taxpayers that the former employee represented. In particular, he mused that with the information he could gather from the former employee, he could conduct more in-depth audits of the taxpayers involved and thus develop files on them based on that information.

30        The grievor claimed that in the same evening he met the former employee, he called his team leader, Mr. Falardeau, on his cell phone and left him a voicemail at the office, advising him of his meeting and of the potential to develop files. According to the grievor, when he returned to the office on May 13, 2013, Mr. Falardeau informed him that he could complete the files and meet with the former employee. In an email to Mr. Falardeau on May 22, 2013, covering several topics, the grievor wrote, “[translation] I will call back tomorrow about the foreign case.” In cross-examination, the grievor did not remember why he had written that message. He noted that when the former employee left him a message on July 11, 2013, he informed Mr. Falardeau of it. He added that Mr. Falardeau had allowed him to meet with the former employee and to complete the files.

31        Mr. Falardeau did not remember receiving the telephone message from the grievor on May 10, 2013. However, he remembered that before his vacation that began on July 15, 2013, the grievor approached him to inform him that he had met with a former union member about foreign tax files. Although he might have advised the grievor in July 2013 to gather information on the matter and that they would then analyze it, Mr. Falardeau did not remember doing so.

32        On July 26, 29, and 30, 2013, the grievor and the former employee met at a restaurant to discuss the files in question. The former employee paid the restaurant bills at each meeting.

33        At the first meeting, the former employee gave the grievor a template for assessment letters for his clients. The grievor made some changes to it, including adding a penalty. At the third meeting, the grievor gave the former employee nine letters to taxpayers about assessment agreements for unreported foreign investment income. Two taxpayers were identified, while the other seven were not.

34        All the letters about the taxpayers were addressed to the former employee, who was to see the grievor again three weeks later to given him the signatures of the taxpayers in question and their personal information.

35        In an email to Mr. Falardeau on July 31, 2013, the grievor reported on the work he had done on the files submitted by the former employee. That email reads in part as follows:

[Translation]

…

Since you were on vacation and I will be and as agreed, here are the results of the meetings.

…

Lawyers represent clients who are nervous about the new government measures announced in the fight against offshoring.

They do not really trust anyone and often provide information to intermediaries without a name, SIN, address, or bank account number…

…

The clients are Canadian citizens, living in Quebec, who want only a restricted audit (could have made amendments, do not want the slowness of the voluntary disclosure process and if it becomes ludicrous, they will keep the $ offshore …

…

Two of the files in question had SINs, I checked and no returns have been uploaded yet, no prison time.

…

He gave me a draft letter that I corrected and that is now acceptable to both parties.

For us: we assess a disclosed return on foreign investments (that was omitted) for someone at up to 3.25% per year over 4 years based on the disclosed investment amount at December 31, 2012, with a 163(2) penalty, no possibility of objection or appeal, and immediate cash payment.

We base ourselves on the presented documents and calculations (the return seems actually to be much less because given the small return, the money was invested in the last year in a monetary fund. Once the client signs the limited project, we can audit anything about the client, and if the money invested is from unreported income, the client may be taxed depending on the information we are able to obtain, as in any other case. In fact, we make no commitment.

We agree only to the current taxation of a return disclosed by the client without an audit. We bring money into Canada, which generates past and future revenue for Canada. The client may be audited and assessed for more, as we know, becoming a good citizen without this skeleton in the closet and in the tax paradise (with current economic performance that could decline).

The directives allow us (and this is essential for us because [the former employee] has yet to obtain power of attorney) to prepare an anonymous draft. I read the different directives and legislative provisions on voluntary disclosures about investments in tax paradises, and our letter is consistent with the legislator’s will.

Thus, you will find attached the different letters that I have signed and submitted to [the former employee]. He will get back to me with the signatures from these clients in about three weeks.

If you have questions or recommendations before I receive the signed documents of the clients and I ask you to open a file number for each client and I close the file by assessing the project, you can reach me at any time on my office cell phone or by message in my office voicemail (which I check regularly). I plan to launch a general audit only if something jumps out at me or if we receive information on this matter from a third party such as FINTRAC.

…

[Emphasis in the original]

36        In his testimony, Mr. Falardeau emphasized that when he returned from vacation on August 12, 2013, he was very surprised to read the July 31, 2013, email as he had no idea of the scope of the grievor’s actions while he was away. As for the phrase in the grievor’s email indicating “[translation] … as agreed, here are the results of the meetings”, Mr. Falardeau said that he never had an agreement with the grievor other than to gather information to complete the T133.

37        On August 12, 2013, Mr. Falardeau emailed the grievor, directing him to wait for him to speak with management before going any further with the former employee’s file. Mr. Falardeau met with Mr. Boutin on August 13, 2013, and Mr. Boutin told him that they were voluntary disclosures.

38        The Voluntary Disclosures Program allows taxpayers or authorized representatives to make a disclosure to correct any incorrect or incomplete information or to provide unreported information. With a voluntary disclosure, taxpayers have the benefit of paying only the taxes and interest owed, with no penalties and without fear of prosecution. In 2013, the Voluntary Disclosures Program was handled by the Shawinigan-Sud, Winnipeg, and Surrey tax centres, not by the grievor’s group.

39        In an email dated August 13, 2013, Mr. Falardeau informed that grievor that he had met with management. As the files submitted by the former employee involved voluntary disclosures, he was obligated to go through the Voluntary Disclosures Program.

40        The grievor did not share management’s view. In an email in response to Mr. Falardeau’s directive on August 13, 2013, he wrote as follows:

[Translation]

For [the former employee’s] files, my opinion is that it is not exactly a voluntary disclosure but a restricted audit agreement and that it gave us stats and was in our open project.

[The former employee] wants nothing to do with endless paperwork and long delays at tax centres.Canada risks losing everything.

I gave my word that if this does not work, I would destroy all the documents received.

…

I am making not one cent from this, so if you are closed I will call and cancel everything and his clients can continue in their illegality.

41        Mr. Falardeau replied to him the same day, and reiterated the following:

[Translation]

The response is clear that these files are not restricted audits, there are no identified taxpayers, they constitute voluntary disclosures and you must refer [the former employee] to Voluntary Disclosures.

42        In their testimonies, Mr. Boutin and Mr. Falardeau argued that a restricted audit targets something specific and that a few years had passed since that type of audit had last been done. According to Mr. Falardeau, when restricted audits existed, a file always had to be open.

43        On August 13, 2013, the grievor again wrote to his team leader, as follows:

[Translation]

Even though the letters issued were each for an unnamed client (as set out in the directives), as I already said, I had the names and contact information for two of them and some financial information for all of them. Later on, I would have had the information that I wanted.

Is it not possible for us to be an intermediary with Disclosures)? I could contact them and try to quickly try (if possible, within our structure) to lighten the paperwork and the response times, a history of innovating, improving, and not being worse than Québec, who met with [the former employee]. I could organize a meeting with several [of them].

If not, I will wait for him to call me back, cancel everything, and do smaller, more difficult files. In fact, we do the small ones.

But I will understand.

44        Mr. Falardeau clearly replied to the grievor’s email as follows:

[Translation]

No, no, and no.

Voluntary Disclosures has its own directives, which must be followed.

45        On or about August 20, 2013, the grievor informed the former employee that he would no longer handle his file and that he could contact Mr. Boutin about it. However, the grievor again met with the former employee on August 23, 2013, at which point he told the grievor that he did not want to deal with Mr. Boutin. The former employee asked the grievor to sign a letter to send his file to the Shawinigan-Sud tax centre. The letter indicated that the grievor had audited the files and that the tax centre could assess them. The grievor did not sign the letter, as he was no longer involved in the case.

46        In the absence of Mr. Boutin, the former employee met with Mr. Falardeau on Friday, August 23, 2013. According to Mr. Falardeau’s testimony and personal notes, the former employee informed him that his clients had accepted the letters signed by the grievor. Mr. Falardeau informed the former employee that the letters exceeded the grievor’s mandate and that they should not have been issued. He told the former employee that he would never have approved the assessments. He also informed the former employee that he needed to present all the documents to the Voluntary Disclosures section at the Shawinigan-Sud tax centre. The former employee then told Mr. Falardeau that he wanted to resolve his clients’ files and not make a complaint against the CRA.

47        Mr. Falardeau suggested that the former employee’s clients could file amended returns, but the former employee replied that his clients would not be interested in that option. As the former employee said that he had had similar files processed in Ottawa and Shawinigan, Mr. Falardeau asked him to provide the names of the people at those offices who had processed them.

48        On August 26, 2013, Mr. Falardeau informed the grievor that he would speak with the Ottawa offices and the Shawinigan-Sud tax centre to find out if either wanted to assess the former employee’s files. Mr. Falardeau told the grievor that the former employee had mentioned that he could make a complaint against the CRA. In response to that threat of complaining, the grievor informed Mr. Falardeau that the former employee had offered him $200 000. The amount was written on a napkin and was offered to him at the July 30, 2013, meeting, after the grievor had given the letters to the former employee. The grievor refused the money and did not keep the napkin. According to him, the former employee offered it to him for the work he had done.

49        The Royal Canadian Mounted Police (RCMP) was informed of the $200 000 offer, and it questioned the grievor and Mr. Falardeau about it on September 10, 12, and 13, 2013.

50        On September 12, 2013, Mr. Donati informed the IAFCD that the grievor had given the former employee letters of agreement to assess unreported foreign interest income for several taxpayers. The IAFCD began a preliminary investigation into the matter, which included a review of the grievor’s accesses to CRA systems between January 1, 2006, and September 11, 2013.

51        On November 12, 2013, the Director of the IAFCD informed Mr. Donati that based on the information gathered during the preliminary investigation, it had reasonable grounds to believe that the grievor had done the following:

[Translation]

Accessed without authorization the accounts of certain taxpayers (those about whom [the former employee] had approached him)

Made unauthorized disclosures ([the former employee] was not an authorized representative)

Given [the former employee] “comfort letters” for several taxpayers to bypass the voluntary disclosures process (not only the one he admitted to his supervisor) (breach of trust)

Used the Agency’s electronic networks to email protected information to taxpayers

Used the Agency’s electronic networks to carry out union activities

Used the Agency’s electronic networks (containing confidential information) outside his work hours. He had signed an agreement with management about his remote work hours.

52        In light of that information, on November 15, 2013, Gabriel Caponi, the assistant commissioner for the CRA’s Québec region, received an email from the IAFCD’s director informing him that she was launching an investigation, as follows:

[Translation]

… [to] determine the circumstances surrounding the allegations of unauthorized access and disclosures, abuse of authority, breach of the Code of Ethics and Conduct, unacceptable use of networks, and breaches of the standards for transmitting and transporting protected and classified information by Pierre Girard.

53        On November 18, 2013, the grievor was informed that he was suspended without pay for an  indefinite period. The suspension letter stated the following:

[Translation]

The Canada Revenue Agency (the CRA) has been informed of allegations that lead us to believe that you seriously breached your obligations under the Canada Revenue Agency’s (CRA) Code of Ethics and Conduct. Consequently, the CRA’s Internal Affairs and Fraud Control Division (IAFCD) launched an investigation to verify the allegations.

As stated in the Code of Ethics and Conduct, CRA employees are required to conduct themselves in an exemplary manner. We examined several possibilities, namely, keeping you in your duties, assigning you other duties, or administratively suspending you pending the investigation. Considering the seriousness of the allegations, the nature of your duties, the Agency’s mandate, and the circumstances surrounding this investigation, you are suspended without pay from your CRA duties, to protect the CRA’s interests and integrity. This unpaid administrative suspension takes effect immediately and will remain in effect for an indefinite period.

…

In addition, due to the allegations against you, we are required to launch a review of your reliability status, under the CRA’s Personnel Security Screening Policy. Consequently, your reliability status has been temporarily suspended pending the security investigation aimed at gathering all relevant information.…

C. The investigation and the termination

54        The investigation took nearly six months to complete. The employees directly involved were interviewed in December 2013 (Mr. Girard and Mr. Falardeau) and January 2014 (Mr. Boutin). Other tax auditors, the grievor’s former manager, and Mr. Falardeau were interviewed in February 2014. The investigation report was completed on June 12, 2014.

55        The internal investigator who prepared the report, Marie-France Leduc, testified before the Board. Among other things, based on her analysis presented in the report, the grievor’s explanation that he had informed his team leader of the files with the former employee on May 10, 2013, was not supported by the invoices for the CRA cell phone he used. No calls to Mr. Falardeau’s telephone number were listed in the invoices, which were also submitted as evidence at the hearing. She also emphasized that it had not been possible to find any incoming or outgoing calls from the Eastern Quebec TSO based on its invoices.

56        The Investigator found no indication that the grievor would have requested authorization to provide letters to the former employee. In addition, he admitted that he had had to wait until Mr. Falardeau returned to close his files. He also admitted that his actions were aimed at offering faster processing than the Voluntary Disclosures Program and that he considered the letters beneficial to the CRA because they allowed funds to enter and be taxed in Canada, and they identified taxpayers. However, the Investigator noted the following:

[Translation]

… the extent of the benefit that the nine taxpayers could have received is still unknown as the sums Pierre Girard used to issue the assessment letters, of his admission, were never validated, and Pierre Girard never conducted in-depth research.

57        The Investigator also indicated that the grievor had tried to claim that his team leader had told him that he had to make up 50% of his files from nothing and that when he had begun the former employee’s files, he did not know that he had to complete only FINTRAC or NADS files. However, all the members of Mr. Falardeau’s team who were interviewed during the investigation confirmed their understanding of the nature of their workload and the procedures. The team members did not have the authority to develop their own workloads or to accept and process voluntary disclosure files. Mr. Falardeau assigned the files, and they were completed based on leads from FINTRAC and NADS, not from nothing.

58        As for the offered money, the Investigator noted that the grievor waited until August 26, 2013, before informing management, although the offer was made to him on July 30, 2013. When she asked him about this, the grievor indicated that he did not place much importance on the offer of cash in exchange for his work as a CRA employee because he could not be corrupted, and he did not see the importance of informing management.

59        The Investigator’s review of the grievor’s unauthorized accesses to the CRA’s system revealed that many of the accesses made between July 28 and 30, 2013 (516 times on July 28 alone), were not part of his workload and were related to the former employee’s files. Those accesses included information about the former employee, his family, his friends and their businesses, and two of the taxpayers that he had identified. The information about those two taxpayers was included in the assessment letters that the grievor prepared and gave to the former employee. As the former employee was not named in a power of attorney authorizing him to represent the taxpayers, he was not authorized to receive that information. The grievor explained to the Investigator that he had accessed the system for the files that he had received from the former employee and for preparing his workload.

60        Based on the information obtained during her investigation, the Investigator reached the following conclusions:

[Translation]

… Pierre Girard … breached the Code of Ethics and Conduct and the Conflict of Interest Code and Guidelines when he:

• granted preferential treatment to [the former employee] and placed himself in a conflict of interest by agreeing to process the files, allowing [the former employee] to bypass the Voluntary Disclosures Program and receive a benefit from the taxpayers in exchange for his services; and
• granted preferential treatment to taxpayers [AS] and [SR] and to the seven other unknown taxpayers by processing their claims, to bypass the service channels normally available to taxpayers through the Voluntary Disclosures Program.

Pierre Girard breached the Code of Ethics and Conduct when he:

• exceeded his authority as an auditor when he assigned his own workload, contrary to the directive and the practice that the team leader assigns the workload;
• exceeded his authority when he worked on the files that he had assigned himself, knowing that they were not part of the Audit division’s mandate and therefore of the section as they were voluntary disclosures;
• issued assessment letters that he had signed directly to [the former employee], adopting a position on the CRA’s behalf without obtaining approval from his team leader, knowing that he had to wait for his team leader to return to close files; and
• worked on the files of [the former employee] without considering the usual audit procedures, without an assignment in the [Audit Information Management System], without preparing an audit plan, and without management’s approval.

Pierre Girard breached the Code of Ethics and Conduct, the Employees’ Access to their Own Tax Information and that of their Relatives and Acquaintances Policy, and the Monitoring of Employee Electronic Access to Taxpayer Information Directive when he:

• accessed, without authorization, confidential information about …
• disclosed, without authorization, confidential information about [AS] and [SR] to [the former employee] by giving him assessment letters, knowing that [the former employee] was not the authorized representative of those taxpayers ….

          [Emphasis in the original]

61        The Investigator also found that the grievor had breached his telework agreement and that he had been insubordinate by issuing the assessment letters and by meeting with the former employee on August 23, 2013, after management had told him that he was to withdraw from the file. She also found that he had breached the Gifts, Hospitality and Other Benefits Policy by allowing the former employee to pay for the grievor’s meals and that he had breached the Communications Security Policy when he twice emailed protected information to taxpayers, in another file.

62        The grievor’s disciplinary hearing was held on July 3, 2014. According to Mr. Donati, at the hearing, the grievor said that he had acted for the good of the Crown and that he deserved a medal from the Minister. His goal had been to obtain the names and social insurance numbers of all the former employee’s clients and then research those taxpayers and the former employee. It was a strategy to trap or audit the taxpayers. Mr. Donati said that that procedure was inadmissible and that it was beyond the norm. It troubled him. Had the taxpayers learned that the CRA was using the Voluntary Disclosures Program to trap them, trust in the system would have been undermined, and the Voluntary Disclosures Program would have ceased to exist. He also emphasized that the CRA was not in the practice of trapping people.

63        As for the letters to the former employee’s clients, the grievor emphasized that it was the first time he had used them. Mr. Donati argued that he had never seen that type of letter before and that to his knowledge, they were not used at the Eastern Quebec TSO. He raised several concerns in that respect.

64        As he understood the content of the letters, the taxpayers wanted to file returns under the Voluntary Disclosures Program. His first concern was that a penalty was to be imposed, when the objective of  that program is to file a return without a penalty. Second, according to the letters, the taxpayer waived the right to file an objection or an appeal. However, Mr. Donati emphasized that the CRA cannot prevent a taxpayer from exercising the right to file an objection or appeal. The letter also mentioned the intention to issue an assessment but without the taxpayer knowing the amount assessed. Third, Mr. Donati was concerned by the fact that the letter had been prepared by the former employee and then given to the grievor to adjust. According to him, it is not normal for a representative to prepare a letter for the CRA to sign.

65        Based on the conclusions of the investigation, the IAFCD conducted a final review of the grievor’s reliability status and found that he represented an unacceptable risk to the security of CRA assets and information. In a letter dated July 29, 2014, he was informed that his reliability status had been revoked.

66        In a letter dated July 31, 2014, and signed by Mr. Donati, the grievor was informed that his employment had been terminated, as follows:

[Translation]

I carefully reviewed the information about you in the [IAFCD] investigation report about situations of serious misconduct in carrying out your duties …

After my review, I conclude that you breached the CRA’s Code of Ethics and Conduct. You committed serious misconduct in your tax auditor duties, and you clearly lacked loyalty to your employer. In fact, you exceeded your authority by assigning yourself files that were not part of your duties or your division and by working without considering the current policies and work procedures for the SME Audit division. You also issued draft assessment letters, through a representative who did not have the required powers of attorney, for nine taxpayers, seven of whom remained anonymous, thus making it possible to bypass the normally available service channels.

Equally as serious, you made several unauthorized accesses to the information of a former CRA employee, those close to him, and taxpayers who were not part of your workload. I have also noted other misconduct: sending information by email that was not secure; failing to respect your telework agreement with respect to your schedule and authorized places to meet with taxpayers, and accepting gifts (meals at a restaurant).

As mitigating factors, I considered your discipline-free record and the length of the investigation. I also considered the aggravating factors, particularly the fact that you have not acknowledged any responsibility, that you showed no remorse, and that your explanations contained several contradictions.

As you know, your tax auditor position requires a high level of trust and integrity. That high level of trust is essential to the proper operation of the Canadian tax system. In light of my review of your actions and considering the mitigating and aggravating factors, I find that the relationship of trust that must exist between an employee and the employer has been irreparably broken. For these reasons and in accordance with paragraph 51(1)(f) of the Canada Revenue Agency Act, I thus inform you of the termination of your employment as an employee with the CRA, effective retroactively to November 19, 2013.

[Emphasis in the original]

IV. Summary of the arguments

A. For the employer

67        The employer claimed that the grievor committed serious misconduct by assigning files to himself that were not part of his auditor duties or those of the Eastern Quebec TSO and by accessing CRA systems for matters not related to his workload, thus breaching several CRA policies and procedures. The other incidents that he was accused of were less serious.

68        According to the employer, the grievor’s termination was justified. It was not a patently unreasonable or erroneous measure in light of the following aggravating factors: the seriousness of the misconduct, the fact that his actions were contrary to the basis of the employment relationship and fundamentally incompatible with the obligations of an auditor and the CRA’s expectations, and the fact that his actions caused considerable harm to the tax system’s integrity and the CRA’s reputation. The employer claimed that it was not a momentary lapse by the grievor but rather repeated and considered misconduct. It also mentioned his lack of remorse and sincere excuses before the hearing. Finally, it noted that he was a union representative and that therefore he was or should have been familiar with CRA policies and procedures, to properly advise his members.

69        The employer claimed that it is clearly established that an employer has the power to retroactively set a termination date under its broad management powers. In this respect, it adopted the position that the grievance about the suspension for an indeterminate period is moot, as the termination was imposed retroactively to the start date of the suspension. Similarly, the grievance against the revocation of the grievor’s reliability status is moot because his termination was justified.

70        In the alternative, the employer stressed that the suspension for an indeterminate period and the revocation of the grievor’s reliability status were administrative decisions, not disciplinary actions. Consequently, an adjudicator has no jurisdiction to deal with these issues under s. 209(1)(b) of the Act.

B. For the grievor

71        The grievor acknowledged that the evidence consisted essentially of what the employer presented. The facts are not contested; it is a matter of interpreting them while considering the context. However, he claimed that he was limited in his defence, as he did not have access to the documentary evidence because, according to his suspension letter, he had to return all CRA property.

72        It is important to determine whether the suspension resulted from an administrative decision or a disciplinary action. If it was from a disciplinary action, the Board has full jurisdiction. In this respect, the grievor claimed that the suspension letter did not provide any grounds, other than the reference to the Code of Ethics. The most serious acts in the circumstances were the steps he took with the former employee, the assessment letters, and the accesses to taxpayer files.

73        The grievor emphasized that the events that led to the suspension took place between May 10 and August 12, 2013. He added that he ceased his activities when he was asked to. He then met with the former employee one more time to inform him that he was no longer on the file. However, the employer waited until November 18, 2013, to suspend him without pay for several months.

74        The grievor questioned what happened between the two dates and the risk between July 31, 2013, and November 18, 2013. He maintained that Mr. Falardeau was aware of the files on which he was working with the former employee. However, he stressed that Mr. Falardeau did not ask him for details about the file and did not tell him to stop. As of August 13, 2013, Mr. Falardeau and Mr. Boutin were aware of the assessment letters and the grievor’s interactions with the former employee. Why was the grievor not suspended then? According to him, only when the RCMP arrived at the Québec TSO did everything change and the matter became disciplinary.

75        The grievor raised mitigating factors about the termination. There was no benefit to the former employee, the taxpayers, or him. He did not hide anything, and his actions were well intentioned. He wanted to complete the file and allow the country to recover unreported money. According to him, he was convinced that he was acting in the CRA’s interests. He added that he was entitled to make a mistake.

76        The grievor also claimed that the letters that he had prepared for the former employee presented no risk and that if on the contrary they did, those risks were not mentioned or established in the evidence. The letters were prepared with the information that the former employee had provided to him; none of it came from the CRA’s system. In addition, the analysis of his accesses to the CRA’s system from 2006 to 2013 showed that no fault could be found, apart from his accesses with respect to the former employee and the taxpayers involved.

77        The grievor acknowledged that he did not follow the usual CRA procedures and that he should not have acted as he did. Although his actions were not a usual practice, he believed that he was authorized. He sees it only as a lack of understanding between him and Mr. Falardeau. He claimed that there was a misunderstanding or a refusal by the employer to analyze his real intent, although he explained it in his July 31, 2013, email.

78        In short, the grievor feels that the termination was unreasonable and that he should be reinstated in his duties.

V. Analysis

79        Before examining the merits of the grievances, I will address two of the arguments that the parties raised.

80        First, I do not accept the grievor’s argument that he was limited in his defence because he did not have access to the documentary evidence. Although he said that he did not have access to certain documentary evidence, he did not specify the nature of that evidence or its potential relevance to the grievances. Additionally, he could have asked the employer to disclose that alleged evidence, but he did not.

81        Second, I do not accept that the grievance about the suspension for an indeterminate period is moot because the termination was imposed retroactively to the date of the suspension. In support of that argument, the employer referred me to Bahniuk v. Canada Revenue Agency, 2012 PSLRB 107; Stene v. Deputy Head (Correctional Service of Canada), 2016 PSLREB 36; Stokaluk v. Deputy Head (Canada Border Services Agency), 2015 PSLREB 24; Gravelle v. Deputy Head (Department of Justice), 2014 PSLRB 61; Legere v. Deputy Head (Correctional Service of Canada), 2014 PSLRB 65; Basra v. Deputy Head (Correctional Service of Canada), 2014 PSLRB 28; and Shaver v. Deputy Head (Department of Human Resources and Skills Development), 2011 PSLRB 43.

82        First, I understand the employer’s position that the suspension and termination are two separate decisions that it made. In addition, it qualified the suspension as an administrative decision and the termination as disciplinary. Although I am free to find that the suspension was disciplinary or that the employer created a single disciplinary action by applying the termination retroactively, as I will explain in my analysis, such a finding would not be consistent with the arguments or the evidence. That being the case, I distinguish the situation in this case from those in Bahniuk, Stokaluk, Gravelle, and Shaver, in which the suspensions were disciplinary in nature.

83        In addition, the employer’s premise rests on my conclusion that the retroactive termination was appropriate under the circumstances. For the following reasons, although I accept that the termination was justified, the employer did not convince me that it had to be applied retroactively. Therefore, there is a distinction between the situation in this case and those in Stene, Legere,and Basra, which the employer relied on.

A. The grievance against the suspension without pay and the reliability status suspension

84        Section 209(1)(b) of the Act states that a grievor can refer to adjudication any individual grievance related to “… a disciplinary action resulting in termination, demotion, suspension or financial penalty …”. According to the employer, since the grievor was subject to an administrative suspension, the referral of the grievance to adjudication did not meet the requirements of s. 209(1)(b).

85        Although an employer may qualify a suspension as administrative, my task is to verify that claim. I must examine the intent behind the decision when it was made, to ensure that it was not disciplinary in nature and that it remained not disciplinary throughout the resulting suspension. The factors to be examined to determine whether a decision was a disguised disciplinary action include the repercussions of it on the grievor and his or her career prospects, whether the action can be relied on in a subsequent disciplinary action, the disproportion between the impact of the employer’s decision and the cited administrative rationale, and whether the decision was corrective in nature (see Canada (Attorney General) v. Frazee, 2007 FC 1176 at paras. 21 to 25).

86        It is generally accepted that a suspension without pay pending the outcome of an investigation and the suspension of a reliability status are not presumed to be disciplinary actions (see Braun v. Deputy Head (Royal Canadian Mounted Police), 2010 PSLRB 63 at para. 135). In accordance with that assumption, I find that the grievor’s suspension without pay and the suspension of his reliability status were administrative decisions.

87        As indicated in the suspension letter on November 18, 2013, and as noted at the hearing by the person who signed it, Mr. Donati, the purpose of the suspension was to “[translation] … protect the CRA’s interests and integrity.” That intention is consistent with the results of the preliminary investigation, which found that among other things, some grounds suggested that the grievor accessed taxpayer data without authorization, made unauthorized disclosures, and issued letters involving several taxpayers to bypass the voluntary disclosures process.

88        When the decision to suspend the grievor was made, the intent was not to punish or correct his noted conduct but instead, as indicated in the suspension letter, to launch an investigation “[translation] … to verify the allegations.” The employer did not yet intend to take disciplinary action. In fact, it did not have the required information and was not prepared to take disciplinary action. In reality, the information obtained during the investigation was the basis for the subsequent disciplinary action, namely, the termination, and not the earlier suspension.

89        I also find that the suspension without pay considered the CRA’s conclusion that the grievor could not remain in his duties or be assigned other tasks. In his testimony, Mr. Donati said that in suspending the grievor, he did not intend to punish or discipline him. According to Mr. Donati, had management been able to assign the grievor to duties in which he would not have had access to the CRA’s systems, it would have. However, it was not possible. Additionally, as Mr. Donati had temporarily suspended the grievor’s reliability status, no other position was available at the Eastern Quebec TSO. Mr. Donati’s testimony was not contradicted.

90         Mr. Donati explained that the suspension of the grievor’s reliability status was a factor in the decision to suspend him without pay. As maintaining reliability status is a condition of employment set out in his offer letter, he could not work without it.

91        I also cannot find that the suspension of the grievor’s reliability status was a disguised disciplinary action or that it is an indication in any way that the suspension without pay was a disciplinary action. The reliability status suspension was based on the same allegations and intent of “[translation] … gathering all relevant information.”

92        Although the grievor did not question the conduct of the investigation or the employer’s conduct during it, nonetheless, he emphasized that while the incidents that led to his suspension took place between May 10 and August 12, 2013, the employer waited until November 18, 2013, to suspend him. He suggested that the matter became disciplinary when the RCMP became involved.

93        According to the evidence, between August 12, 2013, and November 18, 2013, additional information was discovered about the grievor’s situation with the former employee. In particular, on August 26, 2013, he informed Mr. Falardeau that the former employee had offered him $200 000. Consequently, the RCMP and the IAFCD became involved. The IAFCD conducted its preliminary investigation from September 12 to November 15, 2013, when the IAFCD’s director informed Mr. Caponi that she would conduct a more in-depth investigation. In my opinion, the events between August 12, 2013, and November 18, 2013, do not mean that the matter became disciplinary but instead that more information needed to be gathered on what took place between the grievor and the former employee. These facts reinforce the employer’s intentions in suspending the grievor and the administrative nature of that decision.

94        The grievor claimed that the suspension letter did not provide any grounds other than the reference to the Code of Ethics. I do not accept his argument that the lack of grounds in the suspension letter shows in any way bad faith or a lack of procedural fairness on the employer’s part. Given that the only issue to be determined is whether the employer’s decision was disciplinary in nature, the bad faith and lack of procedural fairness allegations cannot stand alone (see Braun, at para. 141). Although they can be considered as an indicator of the employer’s disciplinary intentions, I do not see how the lack of detailed grounds in the suspension letter supports such a finding.

95        In his testimony, the grievor noted that the suspension had negative repercussions on him. He stated that he had to find another job, which was difficult because he was not certified as an accountant. I have no doubt that he had difficulties during his suspension. However, even in light of the repercussions of the suspension on him, I find that given all the circumstances, the employer’s intention in the suspension was not to discipline him. I reiterate that the suspension without pay was consistent with the CRA’s determination that he could not continue to carry out his duties or be assigned other tasks.

96        Therefore, I find that the decision to suspend the grievor without pay and to suspend his reliability status was administrative. Consequently, the grievance contesting those decisions does not fall within the scope of s. 209(1)(b) of the Act and must be dismissed.

B. The grievance against the termination and the reliability status revocation

97        Unlike the suspension grievance, it was uncontested that the grievance against the termination was disciplinary in nature. Therefore, it must be determined whether the termination was fair and reasonable under the circumstances of the case. In this respect, Wm. Scott & Co. v. Canadian Food and Allied Workers Union, Local P-162, [1976] B.C.L.R.B.D. No. 98 (QL), indicates that three questions that must be asked: (1) Was there cause for discipline? (2) If so, was the termination an excessive response in all of the circumstances? (3) If it was excessive, what alternative should be substituted? (see Wm. Scott, at para. 13).

98        In response to these questions, I find that there were grounds to take disciplinary action against the grievor and that his termination was not an excessive response, in all the circumstances. However, the employer has not convinced me that the termination had to be applied retroactively.

99        Given that I find that the grievor’s termination was justified, the grievance contesting his reliability status revocation becomes moot. I note that had I found the termination excessive, the issue of the revocation could have been relevant in answering the question of the measure to be substituted.

1. Was there cause for discipline?

100        Mr. Donati indicated that the decision to terminate the grievor was based primarily on the following: assigning files that were not related to his duties, issuing draft assessment letters through a representative who did not have the required powers of attorney, and making unauthorized accesses to the CRA’s system unrelated to his workload. The other misconduct identified in the termination letter, namely, sending information by email that was not secure, not complying with the telework agreement, and accepting gifts (meals at a restaurant), were secondary and were not determining factors in the decision to terminate him.

101        As for the main considerations, certain applicable policies must be considered. The Code of Ethics sets out the CRA’s four values, which are integrity, professionalism, respect, and collaboration. Integrity is described as “… the cornerstone of our administration. It means treating people fairly and applying the law fairly.”

102        Section 3 of the Code of Ethics, entitled, “Your expected standard of conduct”, states, “When faced with a difficult situation, you should first consider seeking advice from your manager.” Section 3(a), on using and accessing electronic networks, states that the CRA’s primary computer systems and databases must be used only “… for authorized business purposes, that is, for carrying out tasks that form part of your assigned workload.”

103        Section 3(s) of the Code of Ethics, entitled “Care and use of Agency information (confidentiality)”, states that acquaintances or former colleagues, among others, cannot be served if they are representing an organization, etc. Should it arise, employees must advise their managers so that another employee can serve them. Otherwise, employees must first obtain authorization from their managers and then follow the usual procedure.

104        Page 23 of the Code of Ethics states, “You must never: access any information that is not part of your officially assigned workload” [emphasis in the original].

105        Section 3(i) of the Code of Ethics and the Conflict of Interest Code and Guidelines are about conflicts of interest. Under the Code of Ethics, a conflict of interest arises whenever an employee’s personal interests or outside activities “… impair, or could be perceived to impair, your ability to make decisions with integrity and honesty in the best interests of the CRA and the Public Service”.

106        Section 25 of the Conflict of Interest Code and Guidelines, entitled “Avoidance of preferential treatment”, states that employees “… must not, without the prior permission of their supervisor, offer assistance in dealing with the CRA to any individual or entity where such assistance is outside the official role of the employee.”

107        The evidence showed that the grievor received training on confidentiality and security and on the Code of Ethics and the conflict of interest policy. In 2008, he took part in a one-day session on confidentiality and security; in 2010, he took part in a one-day session on the Code of Ethics. Furthermore, like all employees at the Eastern Quebec TSO, he received annual email reminders about reviewing the Code of Ethics from 2009 to 2013 inclusively. According to Mr. Boutin’s testimony, when employees received the emails, they had to click on a hyperlink to access the policy. If they did not click it, they were followed up with.

108        On February 20, 2013, Mr. Falardeau sent his team a message from the CRA’s commissioner and the deputy commissioner for all CRA employees about protecting taxpayer information. Mr. Falardeau addressed it at a team meeting held on February 22, 2013, which the grievor attended. Among other things, Mr. Falardeau led a discussion of the importance of limiting searches to files in inventory. The grievor acknowledged that he had read the Code of Ethics during his career.

109        The grievor did not follow the policies mentioned earlier or the procedures for his work as set out in the manual referred to earlier in this decision. There is no evidence that he was unaware of the applicable procedures and policies. He received training and reminders and was part of team discussions on policies. In cross-examination, he acknowledged that the procedures described by Mr. Falardeau and set out in the manual applied to audit files.

110        The grievor believed that his actions were legitimate. I find that statement troubling, as it is incompatible with the fact that he knew that his actions were contrary to policy and procedure. Even if I accept that he and Mr. Falardeau discussed the steps that had been taken with the former employee, it does not explain why the grievor did not follow CRA procedures, or the extent of his accesses. In addition, although Mr. Falardeau acknowledged that the grievor might have mentioned to him that he was working on something big, it does not mean that the employer in any way approved of or tolerated his actions. As Mr. Falardeau mentioned, he expected the grievor to follow procedures. The employer’s witnesses said that they were shocked by the letters and the grievor’s accesses, as auditors were not authorized to take such action.

111        The entirety of the evidence showed that the grievor’s actions constituted misconduct. It is clear that he did not follow CRA procedures or policies by assigning himself files that were not part of his duties, issuing assessment letters through a representative who did not have the required powers of attorney, and using the CRA’s computer system to access confidential taxpayer information without authorization. I do not accept the reasons he presented for not following CRA procedures and policies. Therefore, I find that the employer had grounds to take disciplinary action against him.

2. Was the termination excessive in the circumstances?

112        The employer had to demonstrate the underlying facts used to justify the relevance of the disciplinary action. The factors used to assess the disciplinary action include the seriousness of the offence, the premeditated or spontaneous nature of the offence, whether the employee had a good record and long service, whether a progressive disciplinary action was taken first, and whether the termination was consistent with the employer’s established policies. At this stage of the analysis, my role is not to determine the appropriate disciplinary action. Instead, I must consider all the circumstances, including aggravating and mitigating factors, to determine if the termination was excessive (see Wm. Scott, at para. 14).

113        According to the employer, the grievor’s misconduct, namely, performing unauthorized work and accessing its confidential computer systems without authorization to access confidential taxpayer information, was very serious. As the employer stressed, in similar circumstances, the Board has determined that such actions are serious offences (see Ward v. Treasury Board (Revenue Canada - Taxation), PSSRB File Nos. 166-02-16121 and 16122, [1986] C.P.S.S.R.B. No. 335 (QL); and Iammarrone.

114        Like those decisions, my opinion is also that the grievor’s offences were serious. Page 22 of the Code of Ethics states that unauthorized access to information constitutes serious misconduct, as follows:

Accessing information that is not part of your official duties and assigned workload, whether for simple curiosity or at the request of a relative, friend, colleague or former colleague, for any purpose, is serious misconduct.

115        Section 4 of the Code of Ethics, entitled “Failure to comply and consequences” states the following:

Serious misconduct would be individual or group misconduct such as: accessing and/or using unauthorized information for personal gain or the benefit of someone else ….

[Emphasis in the original]

116        Section 4 also includes the following warning:

…

If you contravene the CRA’s Code of Ethics and Conduct, the Values and Ethics Code for the Public Service, or any of their underlying laws, policies or policy instruments, you could be subject to disciplinary action up to, and including, termination of employment.

…

[Emphasis in the original]

117        It is important to mention that this type of unauthorized work and access undermines the trust necessary to the employment relationship and, for a CRA tax auditor, the very foundation of the tax system. As described in the termination letter, the “[translation] … auditor position requires a high level of trust and integrity.” Mr. Donati explained that the grievor was part of the front-line service to taxpayers and that he conveyed the CRA’s image to the public. He noted that the termination letter indicated that the employer-employee relationship of trust was broken because through his actions, the grievor showed that he did not respect the policies and that in his mind, the ends justified the means. He was required to act in accordance with the CRA’s values; his conduct was unacceptable for an employee with 27 years of seniority. The CRA expects its employees with seniority to be models for employees with less experience.

118        Mr. Donati also claimed that there would be negative consequences on the tax system if taxpayers did not believe that the confidentiality of their personal information would be maintained. He said that 92% of citizens comply with tax legislation because they trust the system. As was so eloquently stated as follows in Ward in circumstances similar to this case:

…

From the evidence presented before me, I find that the grievor without authorization or consent of the persons earlier named, with the possible exception of Rhonda Maracle, unlawfully accessed the computers at her disposal and obtained from tax accounts contained therein information which was highly confidential and which she was forbidden to obtain. By so doing, she put in jeopardy the tax system in Canada which is a unique and delicate system based on voluntary personal input by taxpayers of matters of an utmost confidential nature, including financial, marital and other personal information which the taxpayers of Canada have every right to have protected. Such an infringement cannot be tolerated if the tax system is to survive and have any credibility and, in addition, it is a criminal offence to access such information or divulge such information to third parties.

…

119        The grievor’s actions were not spontaneous and did not constitute a momentary aberration. The interaction with the former employee lasted several months. They met in person three times to discuss files and exchange documents. The grievor accessed the CRA’s system many times to search for information about the former employee, his family, his friends, and taxpayers. The grievor acknowledged that throughout that period, he was familiar with CRA policies and procedures.

120        The grievor claimed that his actions were well intentioned and that he acted in the CRA’s interests. He said that there was no benefit for the former employee, the implicated taxpayers, or him and that the letters that he prepared did not present any risk to the CRA. However, if he always acted in the CRA’s interests, why did he not follow established policies and procedures? I note that he admitted that his accesses to the information about the former employee, his family, his friends, their businesses, and the taxpayers were for his purposes, to confirm the former employee’s credibility before proceeding with the files. Mr. Donati indicated that based on the grievor’s accesses and a risk assessment that the CRA conducted, it was concluded that 14 taxpayers had to be advised that their confidential information had been accessed without authorization. Mr. Donati said that that damaged the CRA’s image.

121        I also find that the grievor’s claims about the risk to the CRA did not acknowledge the seriousness of his misconduct. Mr. Donati explained the risk associated with the letters. He claimed that the letters that the grievor gave to the former employee committed the CRA to dealing with the taxpayers without following normal procedures. It must be reiterated that all these risks attacked the foundation of the tax system and were not in the CRA’s interests.

122        As for the grievor’s claims that he had good intentions, I find that they showed a lack of remorse on his part. As I expressed, the fact that he believed that his actions were legitimate is incompatible with the fact that he knew that they were contrary to policy and procedure.

123        Similarly, although the grievor admitted to not following the usual CRA procedures and that he should not have done so, he did not assume responsibility for his misconduct. He claimed that he acted in circumstances that went against him. He was the only one of 200 employees teleworking. He felt pressured by the former employee, and Mr. Falardeau was on vacation. He said that Mr. Falardeau should have questioned him more about the subject of the file he was working on with the former employee, to avoid him going too far. He also said that Mr. Falardeau had known from the beginning that the grievor knew the former employee but that no one stepped in to stop his accesses. When he was asked if that meant that Mr. Falardeau should have assumed that the grievor would access the former employee’s files, I was told that as the grievor understood it, he had to gather the information. He stressed that if his conduct had been so serious, the employer should have intervened sooner. He also questioned the time that passed before he was suspended. He said that he had not hidden anything and that he stopped his activities when he was asked to.

124        I already addressed several of those objections earlier in this decision. They are not consistent with the evidence. The grievor created the circumstances that worked against him. I acknowledge that he spoke with Mr. Falardeau about a potential file to be put together, but I do not believe that Mr. Falardeau was informed of the details of the file or of the steps that the grievor intended to take. No evidence showed that explicitly or implicitly, Mr. Falardeau had authorized the grievor’s activities. In my opinion, the fact is telling that his email to Mr. Falardeau on July 31, 2013, providing the details of his actions with the former employee, was sent after the letters were issued and after the unauthorized accesses were made to the CRA’s system. Although he was familiar with CRA policies and procedures, the grievor did not return to consult Mr. Falardeau to obtain his approval to access the system or before giving the letters to the former employee. Plus, the July 31, 2013, report does not mention the grievor’s accesses to the CRA’s system. Although he ceased his activities when asked to, the misconduct had already occurred. However, although he did not hide anything, he did not disclose the extent of his interactions with the former employee, including accessing information about him, those close to him, and the taxpayers involved, which is why the employer did not intervene sooner.

125        Even considering the fact that the grievor had a good record of long service, I consider that the acts of which he is accused in this case, and the fact that he did not acknowledge the seriousness of his actions and did not accept responsibility for his misconduct, raise serious doubts about the viability of a continuing work relationship. In the circumstances, I find that his termination was not excessive.

126        However, in the circumstances of this case, I had difficulty understanding the basis on which the employer retroactively set the termination date to include the entire administrative suspension period. According to the employer, it is well established that an employer has the power to retroactively set a termination date. In support of that argument, it referred me to Basra, Legere, and s. 51 of the Canada Revenue Agency Act (S.C. 1999, c. 17), s. 51(1)(f) of which reads as follows:

51 (1) The Agency may, in the exercise of its responsibilities in relation to human resources management,

…

(f) establish standards of discipline for its employees and prescribe the financial and other penalties, including termination of employment and suspension, that may be applied for breaches of discipline or misconduct and the circumstances and manner in which and the authority by which or by whom those penalties may be applied or may be varied or rescinded in whole or in part ….

127        Although that provision gives the employer the right to establish and impose disciplinary action, including termination, it does not specifically refer to retroactive termination. In addition, in spite of the precedents the employer relied on, they alone do not convince me of the merits of the retroactive effect in this case.

128        In this matter, apart from claiming that it had the authority, the employer was unable to indicate the legal basis it relied on to impose the retroactive termination. In addition, the termination letter does not state its reasoning in this respect. The retroactive effect of the termination is addressed in the last paragraph of the letter, as follows:

[Translation]

As you know, your tax auditor position requires a high level of trust and integrity. That high level of trust is essential to the proper operation of the Canadian tax system. In light of my review of your actions and considering the mitigating and aggravating factors, I find that the relationship of trust that must exist between an employee and the employer has been irreparably broken. For these reasons and in accordance with paragraph 51(1)(f) of the Canada Revenue Agency Act, I thus inform you of the termination of your employment as an employee with the CRA, effective retroactively to November 19, 2013.

[Emphasis in the original]

129        In Basra, the Adjudicator found that the employment relationship had already been severed when the suspension was imposed and therefore that it was an appropriate date on which to end the employment relationship. In this case, the employer did not decide to end the employer-employee relationship when the grievor was suspended. On the contrary, its evidence and arguments clearly established that the suspension and termination were two separate decisions. It qualified the suspension as an administrative decision and the termination as disciplinary. As I determined earlier in this decision, when it decided to suspend the grievor, its intention was to protect the CRA’s interests and integrity and to launch an investigation to verify the allegations against him.

130        In reality, when the suspension was imposed, the employer did not have the necessary information and was not ready to terminate the employment relationship. The relationship of trust was not yet “[translation] irreparably broken”, as it finally concluded in the termination letter. It also indicated in the suspension letter that it had examined different possibilities for keeping the grievor in his duties or assigning him other duties. Thus, based on the evidence, the grounds on which the employer relied in terminating him did not exist as of the date chosen for the termination, November 19, 2013.

131        I also note that on the date of the termination letter, the employer considered the following additional important factors to justify the termination:

[Translation]

As mitigating factors, I considered your discipline-free record and the length of the investigation. I also considered the aggravating factors, particularly the fact that you have not acknowledged any responsibility, that you showed no remorse, and that your explanations contained several contradictions.

132        Additionally, the aggravating factors listed in the termination letter did not exist on November 19, 2013, as the grievor had not yet provided his version of the facts.

133        For those reasons, although my view is that the termination was not excessive, the employer did not convince me that it had to be applied retroactively.

3. What alternate penalty should be substituted?

134        In light of my conclusions, I uphold the grievor’s termination but only as of July 31, 2014, the date on which the employer gave him the termination letter.

135        For all of the above reasons, the Board makes the following order:

VI. Order

136        The grievance against the suspension without pay for an indeterminate period and the reliability status suspension is dismissed (Board File No. 566-34-9787).

137        The grievance against the termination and the reliability status revocation is allowed in part (Board File No. 566-34-10455). The termination date is set to July 31, 2014.

March 18, 2019.

FPSLREB Translation