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Duty of Loyalty

Did you know that an employee has a duty of loyalty towards their employer? In fact, this obligation was originally largely recognised by the courts before being codified in article 2088 of the Civil code of Quebec (hereinafter: “C.c.Q.”):

2088. The employee is bound not only to perform his work with prudence and diligence, but also to act faithfully and honestly and not use any confidential information he obtains in the performance or in the course of his work.

These obligations continue for a reasonable time after the contract terminates and permanently where the information concerns the reputation and privacy of others.

Concretely, what does an employee’s duty of loyalty imply?  This obligation forces an employee not to harm nor obstruct the business for which they work for. Therefore, this can manifest itself by the fact that, during work hours, the employee must prioritize their employer’s interests over their own.  In this sense, they must act at all times with the utmost honesty towards  their employer, they must protect the confidential information obtained while performing their duty, and cannot appropriate material or intellectual property that belongs to their employer; nor can they use them unduly to their advantage.  The grave or repeated violation of the duty of loyalty during employment could constitute cause for dismissal[1]

Analysing the degree of intensity of the employee’s duty of loyalty will depend on several factors such as the nature of their duties and their responsibilities.  For example, an employee who is part of the business’ administration will have a greater obligation than support staff with regards to their obligation of loyalty towards their employer.

In summary, as the second paragraph of article 2088 C.c.Q. states, the duty of loyalty will continue during a reasonable time after the contract terminates.  What constitutes as a reasonable amount of time? The delay will vary based on the position held, and the business’ nature; generally a reasonable time will vary between a few months to approximately a year.  As to the duty of loyalty with regards to the reputation and privacy of others, the obligation is permanent.

[1] Concentrés scientifiques Bélisle Inc. c. Lyrco Nutrition Inc., 2007 QCCA 676

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