Original article by Howard Levitt published in the Financial Post, December 27, 2018
This year, legislative changes to employment law and recreational cannabis dominated the conversation. Here is a grab bag of the major 2018 employment law cases:
Victories in the #MeToo era
A signed release may not preclude liability from a sexual harassment claim. This victory for the #MeToo movement arose in Emma Watson v. The Governing Council of the Salvation Army. In a damning decision for employers and perpetrators, the court allowed Watson to advance a sexual harassment claim five years after she had signed a release.
Civil courts, rather than criminal, are a superior venue for women to advance their allegations of sexual harassment. Now, the relief associated with even a release after a settlement may be immaterial. A generic release will be insufficient, with specific language required to bar future claims related to sexual harassment or other potentially improper conduct. Employees who have signed a release should be aware that it may not cover matters relating to harassment and their claim may still be live.
In Mark Render v. ThyssenKrupp Elevator, Linda Vieira, an employee who reported sexual harassment, was permitted to have her own lawyer participate in her terminated co-worker’s wrongful dismissal proceeding.
This type of independent representation for a witness in a legal proceeding is rare. Terminated employees should be cognizant of the impact this may have on their cases. Employers should also prepare themselves as, once proceedings commence, employers and terminated employees can expect complainants to seek status in the proceeding. This will obviously make settlement more difficult for both the employer and the terminated employee.
Receipt of long-term benefits precludes an award for damages
According to Brian Roskaft v. Rona, continued receipt of disability benefits could mean no entitlement to wrongful dismissal damages. The court considered a terminated employee’s continued receipt of long-term disability benefits and concluded that he was unable to pursue his claim because he was so indefinitely disabled that his employment had become frustrated. As result, he was only entitled to employment standards minimums. LTD benefits is a strong piece of evidence of frustration.
Being on long-term disability does not mean that your employer cannot terminate your employment. If you decide to pursue a claim for wrongful dismissal damages, continued receipt of long-term disability benefits could impact the strength of your case. Employers, if you are considering terminating an employee currently on medical leave, remain vigilant of your obligations under the Human Rights Code. There is an interesting dichotomy. If the employee is sufficiently disabled and will still be after the dismissal, his entitlement to wrongful dismissal damages is extinguished. But firing an employee for disability, short of that, could attract human rights liability in addition to wrongful dismissal damages.
A termination clause does not need to explicitly displace the common law
Employers need not use explicit language to oust an employee’s entitlement to reasonable notice at common law. That is what the Ontario Court of Appeal decided in Joseph Nemeth v. Hatch Ltd. The termination clause in question read, “The Company’s policy with respect to termination is that employment may be terminated by either party with notice in writing. The notice period shall amount to one week per year of service with a minimum of four weeks or the notice required by the applicable labour legislation.”
The Court of Appeal upheld the enforceability of the provision. In doing so, the court also noted that the contract’s silence regarding severance pay did not make the termination provision unenforceable. Nemeth is a triumph for employers. Prior to this decision, courts had been making every effort to find ambiguity in termination clauses. The decision offers clarity for how a court should interpret similar provisions. Employers should continue to be prudent when drafting employment agreements and must seek legal advice to ensure that the language reflects the most recent case law.
Employers … must consider how to restructure their workplaces to address aging workforces and reserve for the increased awards the courts will be issuing
Employers pay out more in damages
In 2018, Ontario courts were awarding increased notice periods. Previously, absent extraordinary circumstances, 24 months was the maximum courts stated that they would award. But one court awarded 26 months’ pay to each of two dismissed employees, Donald Dussault, age 63, and Maryann Pugliese, 57, both with more than 30 years of service at Imperial Oil. Then a new high-water mark was reached in a case involving Michael Dawe and Equitable Life Insurance Co. in which the court considered that a minimum of 36 months’ pay was an appropriate amount for Dawe, a 62-year-old employee, with 37 years of service at the company.
As the workforce continues to age with the abolition of mandatory retirement, employers will increasingly find themselves in a similar position to these employers and must consider how to restructure their workplaces to address their aging workforces and reserve for the increased awards that the courts will be issuing.
Awards at the Human Rights Tribunal create inflated expectations
This year also marked an exceptional year for damages in the realm of human rights. One employee was awarded $200,000 against Paul Singer, his real estate company and Joe Singer Shoes Ltd. following many years of sexual harassment and assault in both the workplace and in her home (Paul Singer owned the landlord company). In another decision, $75,000 was awarded to an employee after she was subjected to sexual discussions, assault and harassment in her employment at X Tattoo Parlour. Although these damage awards are generating inflated expectations of what the tribunal will award, they still remain the exception. But they could be a harbinger of the future.