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Legal Developments in Human Resources Law

Arbitrator Upholds Discharge of Long Service Employee with Clean Record for Theft

Posted in Labour Relations

In a recent arbitration decision involving a case of petty theft in the workplace, an arbitrator provided very useful guidance on workplace theft and the mitigating factors an employer should take into account in determining the penalty.

The decision involved the discharge of an employee with 17 years of service and a clean disciplinary record for stealing from the company’s cafeteria. The grievor engaged in three acts of premeditated petty theft within a four-day period. When confronted, he refused to admit wrongdoing, specifically denied the thefts and attempted to deflect responsibility by making several false accusations. Even after he became aware that his employment was going to be terminated, he continued to lie and deny the thefts.

Approximately one hour after he was terminated, the grievor confessed. He also admitted stealing items on multiple prior occasions. At the arbitration hearing, the union put great emphasis on the low value of the stolen goods; however, the arbitrator was not moved by this given the grievor’s conduct and the surrounding circumstances. In particular, the arbitrator noted that while the value of items stolen was low, there was an established pattern of misconduct over a substantial period of time, and the thefts were simply “business as usual” for the grievor. The arbitrator accepted that he was genuinely remorseful (for both his misconduct and the consequences thereof); however, that was “too little, too late.”

The arbitrator noted that the timely willingness to take responsibility and accept the consequences for an act of theft, and the demonstration of sincere remorse for the misconduct (as opposed to remorse for the consequences) would have been particularly important because these steps would be a “window to true character and offer clues to the extent to which the employee can truly be trusted again.” Here, the grievor did not do this – his actions undermined the mutual trust that is fundamental to the employment relationship. Therefore, the arbitrator decided that there was ample cause to discipline the grievor, that it would be “inappropriate” to return him to the workplace, and that it was not just and reasonable to substitute a lesser penalty.

The arbitrator’s comments regarding factors in favour of mitigating the employer’s penalty are instructive. Some of the most salient comments are:

  • Workplace-related theft is universally considered to be a serious employment offence which merits a significant disciplinary response. Once theft is proved, discharge remains a prima facie appropriate penalty and the union bears the onus to demonstrate that a less severe penalty is just and reasonable.
  • While relevant, the following will not, by themselves, be generally compelling:
    • an employee’s age or personal circumstances that are not significantly distinguishable from those of any other discharged employee;
    • seniority; and
    • contrition at the hearing.
  • The most significant factors are those which speak to the employee’s character and “trust rehabilitation” potential:
    • whether the theft was premeditated, a single incident or a pattern of behaviour; and
    • the employee’s reaction when confronted with the allegation.

The decision in this case is an important reminder of the critical role trust plays in any employment relationship. Accordingly, in determining whether the penalty imposed for such misconduct was appropriate, arbitrators will engage in a careful assessment of the surrounding circumstances, including the presence or absence of mitigating factors. Employers are therefore well advised to ensure that they approach each incident of theft, including an employee’s post-theft conduct, with the same degree of attention.

This case was argued successfully by Hicks Morley lawyer Martin Addario.

Messier-Dowty Inc v International Association of Machinists and Aerospace Workers, Local Lodge 905, 2015 CanLII 56078 (ON LA)



Court Awards Consultant 8 Months’ Notice for 2 Years of Service

Posted in Employment Law

A recent case demonstrates that despite an agreement characterizing the relationship as one involving an independent contractor, there is always the risk upon termination that the relationship may ultimately be found to require reasonable notice of termination.

At the time of termination, the plaintiff, Lewis Cassar, owned the other plaintiff, Tetra Consulting. The defendant, Continental Bank, contracted with Tetra Consulting to provide services. Tetra invoiced consulting fees on a monthly basis. After a two-year period, the parties were in the process of drafting a contract by which Mr. Cassar would become an employee of the Bank when the Bank decided to end the relationship. When this occurred, the plaintiffs sued for wrongful dismissal.

The Court, on a summary judgment motion, determined that Ms. Cassar was either an employee or a dependent contractor, and that either status entitled him to reasonable notice of termination. The factors on which the Court came to this conclusion included: he worked for the Bank exclusively for a two-year period for approximately 60-70 hours per week, he had an office at the Bank and email address, used the Bank’s tools, represented himself to others as an employee and was subject to the Bank’s control.

Given Mr. Cassar’s age (61), length of service (two years), and senior position, the Court held that eight months was the appropriate notice period.

This case demonstrates that despite an agreement that the individual is an independent contractor, a court may set that aside that agreement if the relationship in reality more closely resembles one between an employer and employee. Employers should be cognizant of the risks, such as tax liability and wrongful dismissal, associated with inappropriately characterizing an individual as an independent contractor.

Tetra Consulting v Continental Bank, 2015 ONSC 4610 (CanLII)

Ontario Court Issues Significant and Conservative Decision on Scope of Privacy Tort

Posted in Information and Privacy

On August 31st, the Ontario Superior Court of Justice issued a significant decision on the scope of the common law privacy tort – both declining to recognize a cause of action based on “public disclosure of private facts” and articulating how the protection granted by the recognized “intrusion” tort is circumscribed by the interest in free expression.

The case involved a claim against the CBC that the plaintiff – a researcher and professor at Memorial University in Newfoundland – framed both in defamation and breach of privacy. The claim arose out of an investigative journalism program that the CBC aired about the plaintiff’s ethics. The plaintiff alleged wrongs arising out of the words the CBC used in its broadcast and the CBC’s “investigative techniques.” These techniques included receiving and using a confidential report from an anonymous source.

Justice Mew first declined to recognize a claim based on the alleged public disclosure of private facts (or false light publicity). He reasoned that the law of defamation adequately addressed the wrong at issue in the case before him in a manner that carefully balanced the competing interests at stake. He said:

The CBC defendants submit, and I agree, that to expand the tort of invasion of privacy to include circumstances of public disclosure of embarrassing private facts about a plaintiff, would risk undermining the law of defamation as it has evolved and been pronounced by the Supreme Court. To do so would also be inconsistent with the common law’s incremental approach to change.

Justice Mew did, however, allow the jury to consider the whether the CBC committed an intrusion upon the plaintiff’s seclusion because, unlike a defamation claim, an intrusion claim “focuses on the act of intrusion, as opposed to dissemination or publication of information.” This finding left the jury with a difficult exercise in balancing competing rights. In instructing the jury, Justice Mew articulated a kind of immunity for receiving confidential information from whistle-blowers (without the use of unlawful means) and drew upon the defamation defences to circumscribe the intrusion tort as follows:

If you conclude that the actions of the CBC did not breach any laws, were not actuated by malice, or did not fall outside the scope of responsible communication, there would be no basis upon which you can find the CBC defendants liable for invasion of privacy. As to what constitutes malice and responsible communication, you should apply the same considerations that pertain to the defences of fair comment and responsible communication described by me earlier in relation to the defamation claim. If you have considered those questions (4 and 5) and have concluded that the defence of responsible communication should succeed, then you should answer “No” to question 8, since it would be inconsistent with the recognition of the place of responsible communication in the balancing exercise that I mentioned just now if a journalist whose actions benefit from the protection of that defence in a defamation claim were to remain exposed to a claim for invasion of privacy arising from her journalistic activities. Put another way, the prerequisite that there must be no lawful justification for the invasion of a person’s private affairs or concerns will be hard, if not impossible, to satisfy if there has been a finding that such an invasion occurred during the course of responsible journalistic activities.

Chandra v CBC, 2015 ONSC 5303 (CanLII)

(Reproduced from All About Information, Dan Michaluk)

Ontario Court of Justice Dismisses OHSA Charges Where Worker’s Unauthorized Act Led to Injury

Posted in Health and Safety

In a recent decision, R. v. ABS Machining Inc., the Ontario Court of Justice dismissed Occupational Health and Safety Act (“OHSA”) charges against an employer where the injured worker’s unexpected and unauthorized act led to his injury.

The decision confirms that employers can succeed in defending charges on the basis of due diligence when workers act in unforeseen ways. Employers will not necessarily be held responsible for their workers’ conduct if they have made reasonable efforts to prevent foreseeable injuries. The Court also provides helpful comments that it is not reasonable to require supervision of workers at all moments, for all things, and that an inspector’s failure to issue a stop work order may be relevant. With sound safety measures and procedures in place, employers can increase their chances of defending against OHSA charges laid against them, and avoiding the ensuing penalties.

In this case the worker, who was not responsible for rotating a large piece of equipment, used an overhead crane to rotate a large spindle that weighed about 10,000 pounds. When he used improper equipment to do so, the spindle fell off its stand and onto his foot, which had to be amputated. The Ministry of Labour charged the employer with failing to ensure that the spindle was moved safely and failing to properly train the injured worker.

The Court concluded that the injured worker’s supervisor had not instructed him to rotate the spindle. It also concluded that a reasonable employer could not have foreseen that the injured worker would rotate the spindle on his own and do it in the manner that he did, for the following reasons:

  • there was no evidence that a junior employee had ever previously tried to move a large piece of equipment like the spindle before;
  • there was a protocol in place which the injured worker acknowledged that he understood;
  • the way in which the worker rotated the spindle was contrary to his training; and
  • the worker attempted to rotate the spindle even though someone in his role would never be responsible for such work.

The injured worker conceded that he had failed to follow his training. Evidence of the worker’s training and protocols the employer had in place was key to the due diligence defence.

The Court concluded that the employer had established due diligence: it took every reasonable precaution in the circumstances, and could not have anticipated that the injured worker would rotate the spindle. The OHSA charges were dismissed.

Employer Investigations Held to Standard of Reasonableness, not Correctness or Perfection

Posted in Human Rights

In a recent decision, Zambito v. LIUNA Local 183, the Human Rights Tribunal of Ontario (“Tribunal”) provided some useful guidance on internal employer investigations. It reiterated that while it is extremely important for employers to respond seriously and promptly to all allegations of discrimination and harassment, they will be not be held to a standard of correctness or perfection in their response. Rather, the standard is one of reasonableness.

The decision is also of some assistance when dealing with a complainant who is insisting on a particular remedy, as the Tribunal makes clear that an employer may determine the appropriate outcome, provided that it is reasonable.

In this case, the applicant alleged discrimination principally on the basis that the employer failed to investigate his complaint that he had been subjected to harassment as the result of nationality and family.

The Tribunal applied the following three-part test to determine whether the employer’s response to the complaint was reasonable:

  1. Awareness of issues of discrimination/harassment, Policy, Complaint Mechanism and Training: Was there an awareness of issues of discrimination and harassment in the workplace at the time of the incident? Was there a suitable anti-discrimination/harassment policy? Was there a proper complaint mechanism in place? Was adequate training given to management and employees?;
  2. Post-Complaint: Seriousness, Promptness, Taking Care of its Employee, Investigation and Action: Once an internal complaint was made, did the employer treat it seriously? Did it deal with the matter promptly and sensitively? Did it reasonably investigate and act?; and
  3. Resolution of the Complaint (including providing the Complainant with a Healthy Work Environment) and Communication: Did the employer provide a reasonable resolution in the circumstances? If the complainant chose to return to work, could the employer provide her/him with a healthy, discrimination-free work environment? Did it communicate its findings and actions to the complainant?
    (per Laskowska v. Marineland at para. 59)

In this case, the Tribunal found that all three elements of the test had been satisfied. First, it was clear that the employer was aware of the alleged harassment. Second, the investigator’s testimony with respect to the post-complaint conduct was reasonable, logical and coherent. Third, by meeting individually with the applicant and the alleged harasser to discuss the investigation report, the respondent had provided a satisfactory resolution to the complaint. There was no obligation for the respondent to bring both parties together and require the harasser to apologize or to shake hands. Reviewing the report with the parties was sufficient.

Federal Court Confirms “Family Status” Applies to Mother-in-Law

Posted in Human Rights

In Canada (Attorney-General) v. Hicks, the Federal Court held that the Canadian Human Rights Tribunal (“CHRT”) did not err when it found that Human Resources and Services Development Canada (“HRSDC”) discriminated against Mr. Hicks in refusing to approve expenses associated with maintaining temporary dual residences after a relocation from Halifax to Ottawa. After Mr. Hicks relocated, his wife remained in Halifax for a period of approximately one year to care for her ailing mother who lived in a nursing home. HRDSC denied his request for reimbursement of expenses. The policy regarding temporary dual residence required that a dependant reside in the home for which the expenses were being sought. As the mother-in-law did not reside in the home in Halifax, the expenses were not approved.

The Federal Court decisively confirmed that the protected ground of “family status” includes eldercare obligations. The Court likened eldercare to childcare in that non-fulfillment can attract both civil and criminal responsibility if not exercised properly.

Perhaps more concerning is that this decision confirms that discrimination may be found even where the employee does not incur a conflict between work and family status obligations. Indeed, the Federal Court upheld a finding by the CHRT that the benefit at issue was “under-inclusive” in failing to provide expense reimbursement for maintaining temporary dual residences for dependants who reside outside of the home. In particular, the Court accepted that discrimination can be found where benefits offered to employees will differ based on a protected ground.

Given this finding, it is worthwhile for all employers to consider whether the benefits they offer to employees could be at risk of being found to be under-inclusive as a result of making a distinction based on criteria which could relate to any protected ground.

Significant Damages Awarded Against Employer for Sexual Harassment of Temporary Foreign Workers

Posted in Human Rights

In a recent decision of the Human Rights Tribunal of Ontario (the “Tribunal”), Vice-Chair Mark Hart imposed a significant damages award against corporate respondent Presteve Foods Ltd. and its directing mind, Jose Pratas (“the personal respondent”).

In O.P.T. v. Presteve Foods Ltd., two Applicants, O.P.T. and M.P.T., alleged that the personal respondent had engaged in harassment and discrimination contrary to sections 5 and 7 of the Ontario Human Rights Code (the “Code”). More particularly, the Applicants, both of whom were in Canada as part of the Temporary Foreign Workers Program, alleged that they were subjected to a sexually poisoned work environment, discrimination in respect of employment because of sex, unwanted sexual solicitations and advances and reprisal.

The personal respondent engaged in a pattern of unsolicited and unwelcome conduct, including unwanted “invitations” to dinner, hugs, kisses and touching. When the Applicants would refuse to engage in these acts, the personal respondent would threaten to send them back to Mexico.

At the commencement of the hearing, the Respondents raised a preliminary objection to a proceeding on the merits on the basis that the Application had not been made within one year of the events at issue. In disagreeing with this position and dismissing the objection, Vice-Chair Hart noted that both Applicants had spoken to legal counsel and to the police about the Respondent’s conduct within one year of its occurrence. Unfortunately, through no fault of the Applicants’ own, the police and legal counsel had failed to inform the Applicants of their right to bring either a human rights Application or a civil proceeding against the Respondents.

Vice-Chair Hart further noted that because the Applicants did not speak English and were not familiar with the legal system, it was not unreasonable that they had relied on others to inform them of their rights. The Applicants’ delay in bringing the Application was therefore found to have been incurred in good faith and the Application was permitted to proceed to a hearing on the merits.

The hearing took place over 16 days and involved substantial viva voce evidence from both Applicants and an expert in the field of Temporary Foreign Workers. The expert, Dr. Kerry Preibisch, had previously testified before the Tribunal in Peart v. Ontario (Community Safety and Correctional Services) (“Peart”) and was determined to be qualified to speak to the Applicants’ particular vulnerability. Significantly, the personal respondent did not give evidence at the hearing. This meant that although Vice-Chair Hart was required to make a determination with respect to the credibility of the Applicants, he was not required to decide between two competing accounts of the events.

Vice-Chair Hart found the evidence of the two Applicants to be credible in respect of all of the allegations raised in the Application, and thus determined that the personal respondent had engaged in unwanted sexual solicitations and had sexually assaulted the Applicants. It was further determined that these acts had occurred at the personal respondent’s office, in his car, while at dinner with O.P.T. and when O.P.T. was alone with the personal respondent at his home.

Notably, Vice-Chair Hart found that each of these locations constituted “the workplace” for the purposes of section 7 of the Code, which provides a right to be free from harassment in the workplace because of sex, sexual orientation, gender identity or gender expression. Even though these incidents occurred outside of the corporate respondent’s physical premises and often outside of work hours, Vice-Chair Hart concluded that these incidents were sufficiently connected to the Applicants’ employment to be regarded as occurring within the workplace for the purposes of the Code.

Vice-Chair Hart also found that the personal respondent’s pattern of persistent and unwanted sexual solicitations, advances and sexual harassment had created a sexually poisoned work environment and that his actions constituted discrimination against the Applicants because of sex in respect of employment.

In light of the objective and unprecedented seriousness of the personal respondent’s conduct, as well as the particular vulnerability as a migrant workers and the impact of the personal respondent’s conduct on the Applicants, O.P.T. was awarded $150,000.00 as compensation for injury to dignity, feelings and self-respect and M.P.T. was awarded $50,000.00 as compensation for injury to dignity, feelings and self-respect. These awards were made following a thorough examination of the Tribunal’s earlier cases concerning sexual harassment and sexual solicitation, where less significant compensation was awarded. Vice-Chair Hart found that these awards were proportionate to the prior awards given the far greater seriousness of the personal respondent’s actions and the particular vulnerability of the Applicants as migrant workers.

Vice-Chair Hart also ordered that the corporate respondent, Presteve Foods Ltd., provide any workers hired under the auspices of the Temporary Foreign Worker program with human rights information and training in the native language of any such hire for a period of three years from the date of his decision.

Finally, although Vice-Chair Hart was also specifically asked to comment on certain aspects of Temporary Foreign Worker programs in Canada, he declined to do so.  He did, however, echo his earlier sentiment in Peart, in which he had noted the particular and special vulnerabilities of migrant workers in Ontario, especially in light of the closed work permit that requires them to be tied to one employer.  Accordingly, though he made no specific comment about Temporary Foreign Worker programs in Canada, he did indicate that such programs generally place the enrolled workers in a uniquely vulnerable position.

BCCA Affirms Order Requiring Google to Render Domains Unsearchable

Posted in Information and Privacy

Last Thursday, the Court of Appeal for British Columbia issued an important decision in Equustek Solutions Inc. v. Google Inc. about the power of a domestic court to make orders against non-party, internet “intermediaries” – in this case, search engine provider Google.

The matter involved an order made to help a network hardware manufacturer enforce its intellectual property rights against a former distributor who had gone rogue. After the plaintiff sued the former distributor, it went underground – essentially running a “clandestine” effort to pass off its own products as the plaintiff’s products. This scheme relied on the internet and, to a degree, Google’s market-dominant search engine.

Google voluntarily took steps so searches conducted at the Google.ca search page would not return specific web pages published by the defendants. The plaintiffs sought and obtained an order to block entire domains and to block searches originating from all jurisdictions. Google appealed, making a number of broad arguments about the impact of the order (and its kind) on comity principles of private international law as well as international (internet-based) freedom of expression.

The Court of Appeal dismissed Google’s appeal, demonstrating significant sympathy for the perils facing the British Columbia plaintiff. And while the Court was sensitive to the principles raised by Google (along with the Canadian Civil Liberties Association and the Electronic Frontier Foundation as interveners), it held that the principles were not engaged in the matter:

[…] Courts should be very cautious in making orders that might place limits on expression in another country. Where there is a realistic possibility that an order with extraterritorial effect may offend another state’s core values, the order should not be made.

In the case before us, there is no realistic assertion that the judge’s order will offend the sensibilities of any other nation. It has not been suggested that the order prohibiting the defendants from advertising wares that violate the intellectual property rights of the plaintiffs offends the core values of any nation. The order made against Google is a very limited ancillary order designed to ensure that the plaintiffs’ core rights are respected.

This reasoning by the Court of Appeal relates back to a significant admission by Google – an admission recorded by the chambers judge as follows: “Google acknowledges that most countries will likely recognize intellectual property rights and view the selling of pirated products as a legal wrong.”

The Court of Appeal decision is therefore relatively balanced. Global internet intermediaries like Google process and store such significant volumes of information today that their cooperation can be important to advancing a civil action or, like in this case, obtaining an effective remedy. In general, this British Columbia case will help organizations deal with global internet intermediaries. However, global search engine “takedown orders” of the kind issued in this case will not necessarily be easy to obtain and enforce.

Adapted from “All About Information” by Dan Michaluk

Court of Appeal Holds that Non-Party and Participant Experts Need Not Comply with Rule 53.03

Posted in Civil Procedure

Cases dealing with expert evidence have recently been considered by appellate courts. We have discussed two of those cases in our FTR Nows, Court of Appeal Holds that Counsel May Review Draft Expert Witness Reports and SCC Clarifies Test for Qualifying as an Expert Witness.

In Westerhof v Gee Estate, the Court of Appeal for Ontario returned to the topic of expert witnesses. This time, the question was whether Rule 53.03 of the Rules of Civil Procedure applies only to “litigation experts” as described in Rule 4.1.01 and Form 53 or whether it applies more broadly to all witnesses with special expertise giving opinion evidence.

In this personal injury case, the trial judge excluded evidence from various participant and non-party expert witnesses because they did not comply with Rule 53.03. On appeal, the Divisional Court held that the type of evidence (e.g. fact or opinion) at issue determines whether Rule 53.03 applies. Accordingly, Rule 53.03 applies where opinion evidence is at issue.

The Court of Appeal disagreed that the type of evidence was the key factor in determining the application of Rule 53.03. It held that participant experts and non-party experts can provide opinion evidence without complying with Rule 53.03 where:

[60]        […] a witness with special skill, knowledge, training, or experience who has not been engaged by or on behalf of a party to the litigation may give opinion evidence for the truth of its contents without complying with rule 53.03 where:

  • the opinion to be given is based on the witness’s observation of or participation in the events at issue; and
  • the witness formed the opinion to be given as part of the ordinary exercise of his or her skill, knowledge, training and experience while observing or participating in such events.

If the expert witness offers evidence extending beyond the above limits, then Rule 53.03 applies.

The Court of Appeal also confirmed that, as with all evidence, the court retains its gatekeeper function in order to ensure that proper and relevant evidence gets in. For example, a court could order the participant expert or non-party to comply with Rule 53.03. It could also exclude all or part of the opinion evidence of the participant or non-party if the evidence did not meet the test for admissibility.

Sonya Sehgal is a 2015 Summer Student with Hicks Morley.

Courts Differ on Termination Provisions and Need for Future Compliance with ESA

Posted in Employment Law

Over the last few years, courts have been reluctant to enforce different “ESA only” termination provisions due to ambiguity. However, not all judges have taken the same position with respect to what constitutes an ambiguous termination provision. The following two cases offer differing views on termination provisions in employment contracts and future compliance with the Employment Standards Act, 2000 (“ESA”).

In 2011, in Wright v. The Young and Rubicam Group of Companies (Wunderman), the Ontario Superior Court found that the termination provision in an employment contract was void because, in addition to not mentioning benefit continuance, it was possible that it would violate the statutory minimum entitlements under the ESA at a future date. This was the ruling even though at the time of actual termination the applicable termination provision was in compliance with the ESA. In particular, while the plaintiff was paid his statutory entitlement at the time of termination, the contract was not in compliance with the statutory minimums had he been terminated after, for example, 9.5, 10.5 or 11.5 years of service, all of which would “run afoul” of the ESA by 0.5 weeks.

On the other hand, in the relatively recent decision Ford v. Keegan, the Ontario Superior Court disagreed with the reasoning in Wright and held that a termination provision in an employment contract is valid if it complies with the ESA on the date of termination, even though it may not be in compliance at some future point.

The Court’s comments in Ford v. Keegan bring some reassurance to employers that they do not have to draft termination provisions with notice periods “of such a length as to satisfy the legislative requirements in every conceivable circumstance.” It is also good practice to stipulate in employment contracts that the employee shall not receive less than his or her minimum entitlements under the ESA.