Not Preventing Sexual Assault and Harassment in the Workplace is Now More Expensive

Jun 22, 2018

On average, damages awarded to an employee for a breach of the Human Rights Code, remain relatively low, typically $10,000 to $15,000. However, the HRTO recently released two significant decisions that reflect a willingness to award higher amounts. Both decisions involve sexual assault and sexual harassment against women in vulnerable circumstances.

In both cases, the owners of the companies were found to be personally liable along with the corporations.

The Cases

In A.B. v. Joe Singer Shoes Limited et al, 2018 HRTO 107, the employee worked for Joe Singer for 28 years. The allegations made by A.B. were of atrocious conduct. She stated that she was forced to perform oral sex, intercourse, and degrading sexual conduct. She accused her employer of watching pornography in his office. Her employer also criticized her skin colour, accent, and body. Although she had issues with her memory in her testimony, the HRTO still preferred her evidence, and found company and the owner both responsible for the sexual assault and sexual harassment. The HRTO ordered the respondents to pay $200,000 as compensation for injury to dignity, feelings, and self-respect.

Following Joe Singer, the HRTO released G.M. v. X Tattoo Parlour, 2018 HRTO 201. In X Tattoo, the applicant was a 15-year-old woman whose employer engaged in unwanted sexual discussion and forced the applicant to engage in sex acts. Looking to the Joe Singer decision, the HRTO awarded $75,000 in general damages (the maximum that the applicant had requested).

Lessons

Most employers would hope and believe that their staff and management would not engage in the conduct seen in Joe Singer and X Tattoo. However, the bar for the maximum damage awards has increased. We can expect that the average award level will also increase.

Employers need to ensure:

  1. that they create a workplace culture of no tolerance for harassment and violence. This includes having the appropriate policies and training in place;
  2. that they respond promptly to every sexual harassment complaint and investigate all complaints as well as incidents; and
  3. that those who come forward do not face punishment or reprisal for doing so.

For over 30 years, MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions about dealing with sexual assault or sexual harassment complaints and allegations and would like to discuss them with a lawyer, please contact me at [email protected] or 647-633-9894.

There are many ways to attack the termination clause in an employment contract. 

I am now surprised if employee counsel does not claim that their client’s  termination clause is not legally enforceable - usually because the termination clause does not allegedly comply with the Employment Standards Act.

This blog considers a case, McKercher v Stantec Architecture Ltd., 2019 SKQB 100, where an employee successfully attacked the termination clause in his contract because he did not explicitly agree to it after being promoted. 

The Facts

In 2006, Mr. McKercher commenced employment as a staff architect. The termination clause in his employment contract stated: 

Termination other than for cause will be with notice or pay in lieu of notice, based on your length of service. If the Employer terminates your employment for other than just cause you will receive the greater of:

  1. a)   Two weeks notice or pay in lieu of notice during the first two years of employment increasing by one week for each additional completed year of employment to a maximum of three months notice or pay in lieu of notice.

      or

  1. b)   The minimum notice of termination (or pay in lieu of notice) required by applicable statutes.

Eleven years later, when Mr. McKercher was employed as a Business Centre Sector Leader, his employment was terminated. The employer paid him the three months termination pay he was owed under his employment contract.

 

Another way to attack a termination clause: What is the changed substratum doctrine?

An Ontario judge in a 2012 case, MacGregor v National Home Services, 2012 ONSC 2042 (CanLII), described this legal doctrine as follows: "The changed substratum doctrine … provides that if an employee enters into an employment contract that specifies the notice period for a dismissal, the contractual notice period is not enforceable if over the course of employment, the important terms of the agreement concerning the employee’s responsibilities and status has significantly changed."

 

The rationale for this doctrine has been described by one judge, Schmidt v AMEC Earth & Environmental Ltd., 2004 BSCS 2012 (CanLII), as follows: "In my view, it was incumbent on the defendants to advise Mr. Schmidt that they intended to continue to rely upon the termination provision set out in the Agreement when substantial changes in his employment occurred. This would have allowed him to consider the matter and to negotiate for other terms. If the defendants wished to continue to rely on the termination provisions there ought to have been a ratification of the provisions as the nature of Mr. Schmidt’s employment changed."

 

Decision

The judge hearing this case relied on the following factors when deciding not to enforce the termination clause in the employment contract: ”...there is no evidence that (the employer) made it clear to the (employee) that the notice of termination provisions were intended to apply to the positions to which he was promoted. The employment agreement contains no express wording to this effect, nor does it contain any wording to support the inference of such an intent. Further, and in keeping with the analysis in Schmidt, the Court received no evidence that, as it promoted the plaintiff, SAL reasserted its understanding and expectation that the notice of termination limit would remain in effect.”

 

Lesson to be learned:

An employer should make it clear that the termination clause in an employment contract applies when an employee is promoted. This expression of this intent should be in writing and should be clear and unambiguous. I recommend that an organization’s employment be reviewed by an employment lawyer every year or two. If your employment contract does not address this issue then think about doing so the next time it is reviewed.

 

For 30 years, Doug MacLeod of   the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him at 416 317-9894 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

 

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