Employers need to keep close watch on office relationships before potentially becoming party to litigation

Before internet dating took off, more people met their spouses in the workplace than anywhere else. Given how much time we spend in the office, that is hardly surprising.

Though employers benefit when staff fraternize and have meaningful relationships with each other and employees enjoy their jobs more and become better team players, ultimately boosting productivity, romantic relationships can be a different story, creating both emotional and professional messes for all involved.

While office relationships are unavoidable and not inherently illegal, employers have a legal duty to ensure that their workplaces are free from discrimination and harassment. That means that they need to keep close watch on such relationships before potentially becoming party to litigation.

It is foolish to assume that all such relationships are healthy, mature, consensual and free from abuse. Office romances can lead to claims of sexual harassment, retaliation/reprisal and even workplace violence, all leading to significant liability.

What can employers do to mitigate these risks? The issue can be difficult to navigate particularly given the lack of any legislation or common-law rule prohibiting office romances. Employers should establish policies outlining their expectations when employees engage in consensual relationships. Although employers have the right to implement outright bans on workplace relationships, that is not necessarily prudent. As with most prohibitions, the targeted behaviour is unlikely to be curbed. Instead, it will simply continue secretly.

A better approach is to institute a policy requiring employees who engage in relationships to report this to the employer and make it cause for discharge to fail to. Once disclosure is made, employers can identify and assess risks. For example, relationships involving managers/supervisors and their subordinates are riskiest. The power imbalance inherent to these relationships blurs the line of consent and creates issues that the employer will ultimately be liable for. Also, other subordinates will be demotivated assuming that the partner in the relationship will be favoured and that the subordinate will not be disciplined or evaluated in the same way by their relationship partner. While an outright ban on all relationships is unwise, prohibiting relationships between managers/supervisors and their subordinates is prudent.

The next logical question is what happens when employees breach these policies. As an employee, should you be worried about risking your job by entering a relationship with a coworker? As with most questions in employment law, the answer is “it depends.” Employers can terminate you in most circumstances if they provide notice and/or severance, but they cannot terminate an employee for cause unless the conduct meets a relatively high threshold. If the policy specifies the consequences, the employer will have a better chance before the courts.

In the 2022 case of Rutledge v Markhaven, the employer terminated an executive director alleging just cause. They claimed the executive breached their fiduciary duty by agreeing with a service provider to promote one of their employees who worked in the defendant’s premises with whom the executive was having a romantic relationship. The court found that just cause for termination was not established and the employer was ordered to pay severance. In coming to this conclusion the court relied on the fact that 1) the relationship did not exist at the time of the promotion, 2) the employee disclosed the relationship to the HR department and board of directors, 3) the employer took no action regarding the relationship until months later when another employee complained, and 4) the employee was honest and admitted to the relationship when asked about it during the investigation.

Although the 2011 case of Reichard v. Kuntz is an older decision, it shows how the outcome can differ based on the circumstances. This employer had a non-fraternization policy between managers and subordinates and required employees to report their relationships to management. The employer terminated the plaintiff for cause for engaging in an affair with a subordinate without disclosing it. The court concluded that the employer had just cause since the misconduct was serious and prolonged and the plaintiff was in a managerial position requiring utmost trust. This employee carried on a romantic affair with a subordinate, continued to deny the affair to the employer, took extended lunches with his subordinate in front of others in his department, recommended that the subordinate be transferred to his department where she would be under his direct control, and gave glowing work-related reports regarding his subordinate in meeting with his superiors. The court held that this wilful misconduct seriously called into question the trust and integrity required as a manager and was sufficient to terminate him for cause.

The takeaway for employees — avoid engaging in workplace relationships; save yourself the headache. If you find yourself in an office romance, ensure that you avoid conflicts of interest, are honest with your employer, and follow the employer’s code of conduct and relevant policies. If you are unsure of your rights, contact an employment lawyer.

Employers should discourage relationships and establish policies setting out their expectations, including requiring their disclosure. If there is a superior subordinate relationship transfer the superior to another position.