You can sue for lost wages due to discrimination even if you haven’t been fired
Original article by Howard Levitt published in the Financial Post, January 8, 2019.
Often stigmatized as awarding low general damages compared to the courts, the Human Rights Tribunal is actually often more advantageous for certain employees seeking monetary awards for their income loss.
Often puzzling to employee clients who visit our office is the question of why they were dismissed in the absence of any apparent performance issues. This puzzle often remains unsolved for many since provincially regulated employers do have the right to fire employees for any reason (short of reasons that are discriminatory), as long as they provide these employees with their wrongful dismissal entitlements.
This provides the dismissed — and likely incomeless — employee some cushion so as to not overwhelm them with anxiety respecting next months’ bills and instead enable them to focus on finding comparable employment.
The problem lies in the fact that this financial cushion is not provided indiscriminately to anyone fired without cause. Rather, the size of the cushion, or the amount of reasonable notice or severance pay provided, is dependent on a host of factors. Generally, and among other factors, the longer the tenure and older the employee, the greater the entitlement.
So what to make of short-tenured employees who may not be eligible for much severance pay, if anything at all, but experience the same long delay, of many months if not years, in finding a new comparable job?
Or what about employees who have a valid termination clause in their employment contract that reduces their notice entitlements to a few weeks despite their long tenure?
One way to circumvent these limitations is by grounding the claim on at least one of the enumerated grounds under the Ontario Human Rights Code.
If one can establish discrimination against the employer based on a Code ground and it resulted in any sort of lost wages, it no longer matters how long the discriminated employee had worked nor does a valid termination clause place limits on their entitlement.
It should be clearly understood that “lost wages” under the Human Rights framework is not limited in the same way as wrongful dismissal damages.
Lost income under Human Rights is based on the but-for test: But for the employer’s adverse conduct, what income would have otherwise been earned?
Lost income under Human Rights is based on the but-for test: But for the employer’s adverse conduct, what income would have been earned?
Unlike claims for wrongful dismissal pursuant to common law, there is no limit to the lost wages; income loss is generally considered to commence from the date of the infringement to the date of the hearing or settlement and potentially beyond. More advantageously, the length of employment is an irrelevant factor in determining lost wages.
In OHRC v Impact Interiors, the court of appeal upheld the Human Rights Tribunal’s award of lost wages, reflecting the difference between what the applicant would have earned in her former job and what she actually earned up to the date of the hearing — even though she had only been employed for two days.
Employees who otherwise would receive no (or very little) severance pay can be awarded years of lost wages if they can establish discrimination played a role in their losses and they have taken adequate steps to mitigate these losses, i.e. find other work.
Under the Code, the complainant can claim any sort of lost wages resulting from discrimination, including being fired from a job, losing shifts, being denied a raise in pay or promotion, not being given a job.
In other words, it is not only dismissed employees who can employ this approach, but any employee who has lost wages due to discrimination.
As an example, if an employee loses a year of wages due to Code based discrimination, they can claim this amount, even if they would only receive a few weeks’ of wages under an employment contract or at law.
Employees and job applicants experiencing human rights issues resulting in income loss should be aware that they have alternative avenues available beyond the conventional notice-period entitlements, and that for a certain group of individuals these other avenues will be significantly more advantageous by way of producing larger monetary awards. Some employees, whose cases would otherwise be too small to justify proceeding, may find it very worthwhile indeed.
For employers, second guess your manager’s recommendations to terminate to ensure that there are no arguable human rights grounds being created. If there are, ensure your case is built on non-discriminatory grounds before dismissal. It is invaluable to have human rights training for your managers and human resource staff to avoid what can be very expensive litigation.