Commonly, our workplaces become the places where we spend most of our time. The majority of our day is spent working alongside our various co-workers. Inevitably, this time together creates bonds between you and your co-workers. Sometimes, those bonds extend further than friendship. Sometimes, those bonds become romances and relationships.

At first glance this sounds like a great, happy thing – but, do these romances carry risks? Could these romances jeopardize your employment? This concern is especially pressing when the romance is between an employee and a supervisor or manager. In this blog post, we will discuss what the Federal Court of Appeal said about such relationships in their 2013 decision Payne v Bank of Montreal.

Payne v Bank of Montreal: The Basic Facts

Mr. Payne was Branch Manager for the Bank of Montreal. He had a romantic relationship with his subordinate, the assistant manager Ms. Carter. This power dynamic between subordinate and superior is very notable. They also made little effort to keep their relationship separate from their work. It was known that they were intimate both outside work and during work hours. According to the adjudicator, Mr. Payne’s conduct was “reckless in the extreme.”

When the Bank found out about this relationship, Mr. Payne was terminated for cause. Undoubtedly Mr. Payne’s conduct was reckless, dangerous and foolish, but was it so serious that it amounted to cause?

Power, Threats and Promises

One very important factor going towards cause in cases such as this is the power imbalance between the superior and their subordinate. What matters is whether or not the superior has taken advantage of that power imbalance to coerce the subordinate into the romantic relationship either through duress or exploitation of some sort. It could be threats of discipline or reprisal, or promises of opportunity and preferential treatment. In brief, the issue is whether or not the superior’s conduct is unwelcome. In this case, Mr. Payne knew that Ms. Carter was vulnerable. He was responsible for writing her performance reviews, and her most recent was anything but positive. Ms. Carter claimed to have felt pressured to continue the relationship. Knowing this, and being aware of the power imbalance between the two, was it right for the Bank to terminate Mr. Payne for cause?

According to the adjudicator, and as upheld by the Federal Court of Appeal, it was not. Despite the power imbalance that existed between the two, the evidence revealed that everything was fully consensual. There was no evidence that Mr. Payne made any threats or promises related to work, and in the absence of such evidence, romantic relationships between superiors and their subordinates do not necessarily constitute cause for dismissal. Indeed, an inequality of bargaining power does not necessarily mean that such relationships are involuntary. Consent is vitiated by duress, unconscionability or exploitation, not by power imbalances necessarily.

As there was nothing to show that the romantic relationship between Mr. Payne and Ms. Carter was anything but consensual, there was nothing to show that Mr. Payne’s conduct was unwelcome. As such, the Bank was mistaken to terminate Mr. Payne for cause on these grounds. Termination was held to be excessive.

Can Romance Exist at Work?

As Payne v Bank of Montreal demonstrated, consensual romantic relationships between co-workers, on its own, will not be sufficient to justify termination, even when there is an inequality of bargaining power between the two parties. However, as noted by the adjudicator, it was certainly “dangerous, foolish and reckless”, especially because the couple was intimate during working hours.

What can you take away from this decision? It is okay to fall in love with your co-workers, but it is likely best to keep the love separate from the work.