Pat Donnely would have made Pinocchio proud.

A model of excellence for 32 years, the auto executive had nowhere to go but up. However, those with the most to gain carry the greatest risk of loss. Repeatedly concealing his involvement in a scheme of strippers, strip clubs and secretive billings, Donnely ensured his reputation wouldn’t be harmed. But when a company-wide audit placed him at the scene of the crime, Donnely’s failure to speak the truth cost him more than a chance at redemption; after 32 years of dedication, it cost him his job.

Donnely began with DaimlerChrysler in 1968, working up the corporate ladder until attaining the second-highest seniority ranking, reporting directly to the president. Donnely’s downfall began when visiting a well known strip club in Toronto with colleagues from DaimlerChrysler and two of its large corporate suppliers. Observing the sexual gymnastics of a nude dancer in a private room, Donnely and company racked up a bill of more than $7,000, which was paid for by one of the suppliers. As it turns out, that company then billed the amount to the other corporate supplier, which in turn recouped the money by padding its bills to DaimlerChrysler.

Shortly after, DaimlerChrysler’s president, concerned about billing practices, initiated an audit, which uncovered the abused expense reporting — to the tune of $35,000 spent at the strip club. Donnely was interviewed by the audit team numerous times and protecting his own reputation, he consciously chose to withhold information he knew was critical to the investigation. The truth eventually caught up to Donnely, as it always does, and his involvement was revealed. Contemplating firing him, DaimlerChrysler gave Donnely one final opportunity to come clean. He was invited to a taped interview where he was asked about his involvement at the strip club and his knowledge of other breaches of DaimlerChrysler’s integrity code. Again, he chose to conceal the truth and for this, Donnely was immediately fired.

Claiming his discharge was excessive given his 32 years of admirable service, Donnely sued for wrongful dismissal. Unfortunately for him, his good record didn’t influence the judge.

His deliberate and repeated dishonesty was a violation of trust that made termination “a proportional response and the only response” the judge said.
As Donnely found out, when it comes to dishonesty, the truth is that you can lose your job. But that’s not always the case. When can dishonesty lead to your own termination? Here are three legal tips to remember:

1. The employer has the onus to prove the nature and extent of the alleged misconduct and the fact that it actually occurred.
2. All the surrounding circumstances must be considered, including your history, the context of the workplace and the employment relationship.
3. The termination is a proportional response to the misconduct.

Daniel A. Lublin practices employment and human rights law in Toronto. Daniel can be reached by email at dan@toronto-employmentlawyer.com