Sacked worker who deleted files ordered to pay more than $100,000 in damages and penalties

A sacked worker who deliberately deleted files has been ordered to pay the firm he worked for more than $100,000 in damages, penalties and costs. Photo / 123RF

A sacked architectural designer who took important work files and deliberately deleted others has been ordered to pay his former firm more than $100,000 in damages, penalties and costs.

Matt Biddle was given several chances to return the files he took home on the eve of Auckland's Covid lockdown last year, but the Employment Relations Authority ruled in a decision released today that he failed to do.

Biddle had worked for West Auckland architectural design firm Gubb Design until he was dismissed for serious misconduct last September.

Gubb Design Limited (GDL) director Darren Gubb told Open Justice Biddle was sacked for dishonesty matters.

The ERA said in its decision that action was taken after he did not return both his former employer's work documents and a hard copy file belonging to a client.

A sacked worker made matters worse when he deleted 3202 items from his OneDrive account. Photo / 123RF

The ERA had previously made compliance orders against Biddle, including that he return all files to the firm by a date in early November last year, which he failed to do.

Neither did he engage in the ERA's process, apart from attending a preliminary case management conference last September. Consequently, the firm's evidence went unchallenged.

Gubb, along with the director of an IT firm engaged to forensically examine Biddle's OneDrive account, answered questions under oath or affirmation from the ERA and the design firm's lawyer.

Biddle worked as an architectural designer for GDL on a salary of $85,000 a year.

A clause in the employment agreement required him to "immediately return all property and material in his possession that belonged to GDL" upon the termination of his employment.

By not returning files as requested, the ERA found that Biddle breached the requirement of good faith which lay at the heart of the employment relationship.

The ERA noted that GDL had suggested innovative ways for Biddle to safely deliver the files around level 4 lockdown constraints, including the contactless exchange of a USB stick and external hard drive. Alternatively, Biddle could have driven to the office, where he could have uploaded his work from the safety of his vehicle using the office Wi-Fi.

However, he deliberately chose not to return any of the work files. To make matters worse, he deleted 3202 items from his OneDrive account two days after he was told by Gubb that unless he uploaded or delivered his work by that afternoon, a formal investigation would follow.

IT expert Dave Allum said a two-step process was needed in order for Biddle to delete the files:

Step one would have involved wiping them from his local device so that the information could not be synchronised with the server.

Step two would have involved him logging on to the cloud-based portal and deleting, for a second time, those same files he had deleted earlier, which would have gone into his recycle bin.

"The Authority finds that Mr Biddle's actions in deleting electronic files from his OneDrive account to be neither accidental nor negligent but a conscious and deliberate decision on his part to cause loss to his employer for which GDL is entitled remedies," ERA member Peter Fuiava said in his written decision.

GDL sought losses of $101,123, made up of components including $60,700 in what it said the firm could have potentially made, had staff not been diverted from doing other revenue-generating work.

More than $40,000 was sought for what it cost the firm for staff to redo Biddle's work because he had not returned the files as requested.

It also claimed lost revenue of $80,000 from four projects which the firm said it was unable to undertake while it was reconstructing Biddle's work, and lost revenue of $150,000 from a project connected to a well-established residential construction company.

It listed other costs amounting to approximately $750,000 in potential losses as a result, including almost $20,000 the firm spent on hiring human resources advice.

The ERA said awarding damages for loss of expected earnings was not a science, but a matter of good sense for the authority to evaluate, as best it could, the value of a lost opportunity.

GDL had to prove that its losses were connected to Biddle's actions and that his breach caused or materially contributed to its loss, but the firm was unable to establish this.

Similarly, the ERA regarded the loss of a chance by the firm to earn more than $200,000 from a state house building project to be speculative as well.

The costs associated with obtaining human resources advice in dealing with Biddle was a cost that should be borne by the business anyway.

"While it is acknowledged that GDL was put to added cost in dealing with a non-responsive and difficult employee, the business nevertheless benefited from that advice particularly with respect to putting into place a formal and robust disciplinary investigation for Mr Biddle."

The authority also said GDL was obligated to mitigate its losses in relation to its claims of lost income through staff and management being diverted by Biddle's actions.

The total amount of damages claimed was therefore reduced by half, leaving an order for the amount of damages at $98,525. An $8000 penalty order was also made, of which half was to be paid to the firm and half to the Crown, plus costs of $6750.

Fuiava said it was his view that the amount accurately reflected the loss suffered by GDL arising directly from Biddle's failure to comply with a lawful and reasonable instruction to return work and client files.

"The claims relating to loss of a chance which are in the hundreds of thousands of dollars have a punitive aspect to them which I do not consider appropriate."

Gubb told Open Justice the firm was now taking steps to ensure they got the money, but it was likely to cost more in legal fees and in time.

He said it had been a hugely stressful and costly process at a time they could least afford it, when construction projects were "falling over left, right and centre".