Go into SQL, right-click the Arena Database and select properties. On the General tab, there's a property for "Collation". You should see something like General_CI_AS. That "CI_AS" part determines if it is Case Insensitive (CI) in the search. It also has Accent Sensitive (AS). If that AS were changed to an AI (Accent Insensitive), then the search would match café when you have a WHERE name = 'cafe' query, as well as your coworker's name.
Maybe check with Arena Dev/Support and see if it is supported to update the Collation setting on the database, or maybe just the Name fields in the core_person table.