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Maple Leaf Shoes Ltd.: Addressing Employee Relations

As she sat in her office in Winnipeg, Britney MacPherson thumbed through a textbook on human resource management. As manager of the Winnipeg location of Maple Leaf Shoes, she was responsible for the day-to-day operations of the facility. However, Britney was finding her job particularly challenging—although she had a B.Com., which she received in 1994 from a well-known Ontario university, her training had been focused on accounting and finance and she had had only one course in human resource management. Things were unravelling in Winnipeg, and Britney knew that she needed help. Unfortunately, her phone calls and emails to the head office in Wilmington, Ontario, brought little assistance.

The company policy regarding employee communications was quite simple: “What goes on at the company stays at the company.” This policy was communicated regularly to all employees. However, Joan Jorgenson, a clerk in the office, had violated this policy. A couple of weeks ago, Joan had struck up a conversation with a co-worker, Natalie King. During their talk, Natalie had mentioned that she had recently moved from Wilmington to Winnipeg, because, according to Natalie, a senior member of management in the Wilmington office had become enraged when Natalie refused his sexual advances. He had threatened Natalie with dismissal, but after a short discussion, an agreement was reached that Natalie would move to the Winnipeg location. Joan became enraged when she heard Natalie’s story, and immediately notified not only employees of the human rights commission in Ontario but also the media in both Winnipeg and Wilmington. Britney is now trying to decide how she should handle the situation.

As they say, “Problems come in pairs.” Britney’s head was aching as the phone rang. On the line was Rob McEwen from the head office in Wilmington. He wanted to find out what Britney was going to do about Paul Bertuzzi. Paul is a 44-year-old warehouse supervisor at the Winnipeg facility. He supervises eight employees, has been with Maple Leaf Shoes for just over 11 years and earns $49,600 a year. Paul’s performance evaluations are among the highest at the Winnipeg office, he attends night school and is two credits away from his B.A., and he is well-liked by his co-workers.

One month ago, Paul went to Toronto to attend a two-day training program for warehouse supervisors. After the first day of sessions, Paul and two other warehouse supervisors (from the Montreal and Toronto facilities) went out for dinner. During the meal, the other two supervisors revealed to Paul that they had developed a scheme in which they wrote off a small portion of the shoe inventory as wastage but actually kept the shoes and sold them to a friend at a discount. As one of the individuals said: “We’re not talking about big money, Paul. However, I’m sure you could use an extra $125 to $175 a week. After all, we’re all underpaid and our salaries are not keeping pace with inflation.” In addition, they told Paul of a new moneymaking scheme and asked if he was interested in joining their “team.” It appears that a shoe manufacturer overseas was interested in mass-producing Maple Leaf Shoes products—however, the new company needed more information on the latest shoe designs and production techniques. Under the scheme, the warehouse supervisors were going to get information for the overseas company in return for part-ownership in the business.

One week ago, an auditor uncovered the scheme. The two warehouse supervisors from Montreal and Toronto were fired. While the audit confirmed that no other Maple Leaf Shoes employees were involved in the scheme, Paul (and one other Maple Leaf Shoes employee) admitted knowing about the fraud. In discussions with top management, the point was raised of whether Paul had a duty to report the fraud. Again, Britney has been asked to deal with the matter.

Questions

1. How should Britney deal with the Joan Jorgenson incident? What factors should she consider in determining an appropriate approach? What legislation would Britney need to be aware of? What suggestions would you make to improve the policy on employee communications?
2. Do you recommend that Paul Bertuzzi be dismissed? Is there just cause for dismissal? What factors need to be considered?
3. If a court ruled that your organization did not have just cause to terminate Paul, what would be “reasonable notice”? Explain your answer. Support your answer with relevant rules and legislation.
4. If you were in Paul Bertuzzi’s position, would you have reported the scheme to senior management or not? Explain your reasoning.