DATE : 25/10/77















Before Mr. Kevin Burkett, Arbitrator








1. This arbitration arose out of the unresolved grievance of a Mr. A. Ravera in which Mr. Ravera, a captain-waiter with the CN Tower Restaurants Ltd. claims that he was discharged from his employement without just cause. Mr. Ravera, who had been an employee of the CN Tower Restaurants Ltd. since it commenced to operate in June, 1976, was discharged on June 15, 1977 for allegedly soliciting a gratuity from a customer in contravention of company policy. The alleged incident giving rise to the grievor’s discharge occured on June 8, 1977. The issue before me, therefore, is whether the Company had just cause to terminate Mr. Ravera within the meaning of Article 17.1 of the Collective Agreement. There was no objection raised with respect to my authority to hear and determine the matter submitted to arbitration.

2. Mr. Wilson Castelo, the customer involved in the alleged incident, complained to the Restaurant on June 10, 1977 that a captain-waiter bearing the name tag "Aldo" had solicited a 10% gratuity from him on June 8 when he and his fiancée had dined at the Restaurant. He complained that the solicitation had taken place in front of other customers and that as a result he had been publicly embarrassed. The employer investigated the incident, satisfied itself that Mr. Ravera was the waiter in question and confronted Mr. Ravera with the complaint. At the time Mr. Ravera denied knowledge of the incident. He testified that it took him a couple of days to recall the details of the incident. Failing a satisfactory explanation the Restaurant terminated his services.

3. The evidence establishes that it is commonly understood within the dining industry that solicitation of gratuities is prohibited. Mr. Ravera himself acknowledged this to be the case. The evidence further establishes that the practice of soliciting gratuities was common among the captain-waiters at the CN Tower Restaurant and that management was concerned and upset with the practice. Mr. A. Delabarre, the Restaurant’s General Manager, testified that upon assuming his responsabilities six months prior to the instant grievance, he called a staff meeting at which he made it clear that the solicitation of gratuities was not permitted and if pursued would result in dismissal. Mr. Silvestri, the Maître D’hôte, testified that Mr. Ravera was at the above mentioned meeting and Mr. Ravera did not deny this fact. Mr. Ravera did testify, however, that while he had been told not to solicit it had never been his understanding that solicitations would result in instant dismissal. The following memo from Mr. Delabarre to Mr. Silvestri was tendered by Mr. Delabarre in support of his testimony with respect to the seriousness with which he viewed solicitation of gratuities:


"I have reference to a letter I received from Mr. Rick Wincell,

who came to the Top of Toronto with a party of eleven, either

on the 18th, 19th or 20th of May.

I am very disturbed to see that waiters are still adding or

recommending gratuities to the bill of the customers. Would

you please investigate this complaint and present to me the

credit card voucher as well as the guests cheque to allow us

to trace the Waiter responsible for this very serious offence.

Would you let me know as well, what action will be taken

against the Waiter and I sincerely hope that you will give a

final warning to all the employees of the Top of Toronto to

avoid that such practice does not reoccur."


This memo was written by Mr. Delabarre the day prior to his receiving the complaint in respect of Mr. Ravera. Mr. Silvestri testified that he too had met with the Captain-waiters and told them that solicitation would result in dismissal. He testified that a notice to this effect was posted on the employee bulletin board. Apparently no copies were retained and none was produced. Mr. Ravera testified that he had never seen a posted memo to this effect. Notwithstanding the common practice there is no evidence before me of any other employee of the Restaurant having been disciplined for solicitation of gratuities prior to Mr. Ravera’s discharge.


4. Mr. W. Castelo, the customer involved in the alleged incident, appeared to testify. It was his evidence that upon receiving the bill, which totalled to 45.09$, he put down 45.10$ with the intention of paying gratuityas he left the establishment. He further testified that Mr. Ravera upon picking up the bill and the 45.09$ turned and said that there was a 10% service charge which was not included in the bill. Mr. Castelo testified that Mr. Ravera’s remarks were a source of embarrassment to him and, not wanting to break a 20$ bill, he asked his fiancée for 5.00$ which he then gave to Mr. Ravera. Mr. Castelo testified that he waited for his 0.51$ change before leaving the Restaurant. He phoned the Restaurant two days after the incident to complain about the conduct of Mr. Ravera.


5. Mr. Ravera’s recollection of the events in question is markedly different than that of Mr. Castelo. Mr. Ravera testified that after presenting the bill he noticed that Mr. Castelo appeared to be in difficulty in that he was asking his fiancée for money. He testified that he therefore checked to see if the amount left by Mr. Castelo was sufficient to pay the bill before proceeding to the cashier. He testified that he returned with the 0.01$ change at which time Mr. Castelo asked him if service was included in the bill. It is the evidence of Mr. Ravera that he told Mr. Castelo that service was not included, that the waiters were not permitted to tell the customers how much to leave as a gratuity, but that customers usually left 10% to 15% if satisfied with the service. Mr. Ravera testified that thereupon Mr. Castelo gave him 5.00$ and turned to walk away at which point he said that he would bring change from the 5.00$. Mr. Ravera explained that 10% of the 45.09$ bill came to less than 5.00$. He admitted under cross-examination that he usually takes whatever is offered by way of gratuity and could not offer a reasonable explanation as to why in this case he would offer to provide the customer with change from his gratuity.


6. I prefer the evidence of Mr. Castelo over that of Mr. Ravera with respect to the incident in question. Mr. Castelo, who does not have a material interest in these proceedings, was clear in his recollection and was unshaken in cross-examination. Mr. Ravera, on the other hand, admitted that he did not recall the events in question when confronted by management on June 15, but rather he recalled the details of the incident some days later. His testimony, especially as it related to providing Mr. Castelo with change from the 5.00$, does not accord with reason nor does it accord with Mr. Ravera’s normal practice in this regard. Furthermore, the Board finds it difficult to believe that Mr. Castelo, a customer who had frequented the CN Tower Restaurant on a number of previous occasions, would find it necessary to ask if service was included in the bill as Mr. Ravera testified. I am compelled to rely upon the testimony of Mr. Castelo and find that Mr. A. Ravera solicited a gratuity from Mr. Castelo on June 8, 1977 in contravention of a company policy which was known to Mr. Ravera at the time.


7. I am satisfied that the policy in question is a reasonable one. The Employer, whose business is essentially one of service, is entitled to direct its waiters to follow accepted dining industry practice and refrain from the solicitation of gratuities. The Employer is entitled to expect compliance in this regard and to repond to non-compliance. Having regard to all of the foregoing, therefore, I find that the Company had just cause to discipline Mr. Ravera.


8. The only issue which remains to be determined is whether I should exercise my authority under Section 37 (8) of the Act and modify the penalty of discharge. Section 37 (8) of the Act provides as follows:

"Where an arbitrator or arbitration board determines that an

employee has been discharged or otherwise disciplined by an

employer for just cause and the collective agreement does not

contain a specific penalty for the infraction that is the subject-

matter of the arbitration, the arbitrator or arbitration board

may substitute such other penalty for the discharge or discipline

as to the arbitrator or arbitration board seems just and reasonable

in all the circumstances."


I believe that Section 37 (8) of the Act places in me a broad-based power of review to determine if `in all the circumstances` the disciplinary response of the employer was just and reasonable (see re Phillips Cables Ltd. and I.U.E. (1974) 6 L.A.C. (2d) 35 (Adams)).


9. It is well accepted and indeed it is anticipated within the work place that certain types of gross misconduct such as theft or assault upon a supervisor will be met with immediate termination of the employment relationship. An employee does not have to be put on notice that he risks his employment if he steals from his employer, or assaults a supervisor or engages in other froms of misconduct which are equally recognized as being capital offences. It is also well established, on the other hand, that the less serious forms of misconduct which do not destroy the employment relationship must be met by corrective or progressive discipline which puts the employee on notice and gives him an opportunity to improve. In such circumstances termination is only used as a last resort in the face of continued misconduct. (see re North York General Hospital and Canadian Union of General Employees, (1973) 5 L.A.C. (2d) 45 (Shime) and Ryerson Polytechnical Institute and Ryerson Faculty Assoc., (1976) 12 L.A.C. (2d) 58 (Simmons)).

There is a third category of industrial offences which encompasses the misconduct of the grievor in the instant case. These are offences which the employer considers to be capital offences within the context of the particular work setting, but which are not generally recognized as such. It is incumbent upon an employer seeking to terminate the employment relationship for a single instance of this type of misconduct to establish that his employees, and in particular the grievor, have been put on notice that termination is the expected response. Employees are entitled to know the consequences of their actions. This is one of the principles underlying the progressive or corrective approach to discipline which is applicable to this third category of industrial offences. If the employees, and in particular the grievor, have not been so notified or if notified the practice of the employer is other than to terminate, then an arbitrator must consider this fact in the exercise of his discretion under section 37 (8) of the Act. An employer wishing to terminate in the circumstances of the instant case must have made it clearly and unequivocally understood that a single offence of solicitation would result in termination.


10. Prior to the instant case the employer had not responded to solicitation by way of discipline and as a result there is no historical or accepted practice as would serve to put the employees on notice. In the circumstances it falls to me to consider the evidence as it relates to the steps taken by the employer to lay the ground work necessary to support the penalty of discharge for a first offence of solicitation.


11. I am not satisfied that the employer in the instant case made it clearly and unequivocally understood to his waiters that immediate termination would be his response to the solicitation of gratuities. Mr. Delabarre and Mr. Silvestri testified that they told the dining room staff that solicitation of gratuities would result in a loss of employment. Mr. Ravera, however, testified that this was never his understanding. The memo of June 9, 1977 from Mr. Delabarre to Mr. Silvestri, which is in respect of an unrelated incident of solicitation, raises a doubt in my mind as to whether instant dismissal was the predetermined response of the employer, absent extenuating circumstances, and consequently raises a further doubt as to the message which may or may not have been left with the employees following the verbal remarks of Mr. Delabarre. The memo, written the day following the incident involving Mr. Ravera, concludes as follows:

"Would you let me know as well, what action will be taken

against the Waiter and I sincerely hope that you will give

a final warning to all the employees of the Top of Toronto

to avoid that such practice does not reoccur."


The question put to Mr. Silvestri by Mr. Delabarre, "what action will be taken against the waiter," suggests that instant dismissal was not a predetermined response. The memo also speaks of a "final warning" but makes no mention of possible termination of employment. The memo supports in my mind the conclusion that the employees, and particularly Mr. Ravera, may not have been aware of the extreme consequences of solicitation. This conclusion is reinforced by the failure of the employer to provide any written instruction in this regard.


11. The employer was unable to produce any written documentation in support of his contention that the employees were on notice. The failure of the employer to produce any written rule or other written instruction raises a serious doubt in my mind as to the efficiency of the steps taken by the employer to make known his probable response to what had become an acknowledged "common practice". The failure of the Company in this regard lends credibility to the testimony of Mr. Ravera that although aware that he was not allowed to solicit gratuities he was not aware that the employer’s response would be one of instant dismissal. The employer’s failure in this regard must also be viewed in light of the broad discretion given in Article 17.2. Article 17.2 reads as follows:

"It is agreed that ther employer may, at its discretion, issue

and enforce from time to time rules and regulations which

shall be binding upon the employees in order to assure the

continuing successful and effficient operation of its business.

Breaches of such rules by an employee shall be cause for

disciplinary action, up to and including discharge."


The article provides the employer with a broad discretion "to issue and enforce" rules which are formulated in order to assure the successful operation of its business and which are binding on the employees upon pain of discipline up to and including discharge. The employer failed to "issue" such a rule in respect of the solicitation of gratuities thereby further lending credibility to the testimony of Mr. Ravera that he was unaware that solicitation would be met by instant dismissal.


13. I am not satisfied that the employer made it clearly and unequivocally understood that solicitation of gratuities would be met by instant dismissal or that Mr. Ravera was under this impression as of June 8, 1977. I am satisfied, however that the solicitation of gratuities is a serious offence which Mr. Ravera knew to be a serious offence at the time he solicited Mr. Castelo. I am also aware of the need for a strong and effective deterrent against this type of misconduct in view of the fact that direct supervision of dining room staff is often impracticable. I have weighed these factors and have also taken into account Mr. Ravera’s prior unblemished, albeit relatively short, work record and have concluded that in all the circumstances the penalty of discharge is excessive. It is my determination that a lengthy suspension, to run from the date of his termination to the date of this award, should be substituted for discharge. While a suspension of this duration reflects the seriousness of the offence and serves the deterrent purpose which is required in this case, it also takes into account the failure of the employer to clearly and unequivocally put the grievor on notice that a single act of solicitation would, in and of itself, result in instant dismissal.


14. It is my award that the grievor be reinstated into his employment without compensation but with no loss of seniority.


DATED at Toronto, Ontario this 25th day of October, 1977.



Kevin M. Burkett

Sole Arbitrator