Supreme Court of Canada’s decision in B.C. case shows employers must address discriminatory behavior by non-employees if it is in the context of the work environment
Human rights legislation across Canada is frequently evolving and adding protected grounds against discrimination, including discrimination with regards to employment. A recent change in many jurisdictions – and backed up by the nation’s top court – doesn’t just limit employment-related discrimination to between employees. Any discrimination that affects an employee while he’s trying to do his job may require the employer to take action or face liability.
There was a time when workplace discrimination was commonplace, even an accepted practice, across Canada. Employees who reached a defined age, for example, might be forced to retire depending on the policies of the organization that employed them or the nature of their position. Women and minorities, too, might be dissuaded or blatantly barred from pursuing certain positions, their career advancement limited by longstanding misconceptions or prejudice.
Much has changed in 2018. Now, every province has human rights legislation prohibiting discrimination on more than a dozen grounds including age, gender, race, religion and disability. In an increasingly multicultural country that accepts hundreds of thousands of newcomers each year, not to mention one that embraces diversity, this is incredibly important progress.
In keeping with that ongoing legislative evolution, organizations of all sizes have worked to reform everything from recruitment practices to workplace policies to reflect new laws and accepted standards designed to protect marginalized communities. They’ve taken great strides to eradicate workplace discrimination and mitigate the risk of human rights violations, even if much work needs to be done to correct decades of now-unacceptable practices.
This progressive approach hasn’t all been borne of benevolence, of course. Countless studies have connected the benefits of robust employee engagement to bottom-line performance, a positive influence on everything from innovation and productivity to worker attraction and retention. Not surprisingly, employees who feel they have a fair shot at achieving their full workplace potential in a harassment-free environment with equal opportunities tend to stay around longer and give their all.
In short, organizations have fought back against workplace discrimination because they must — thanks to human rights and labour and employment laws that have compelled a change in behavior — and because doing so is very good for business.
A Supreme Court of Canada ruling in late 2017 takes those legal requirements to a new level.
In British Columbia Human Rights Tribunal v. Schrenk, Mohammadreza Sheikhzadeh-Mashgoul, an employee of a B.C.-based engineering firm hired by a municipality to oversee a road improvement project, alleged that Edward Schrenk, the site foreman and superintendent of the primary construction contractor hired by the municipality, had made continual racist and homophobic comments about Sheikhzadeh-Mashgoul in the workplace. The engineering firm, acting as a consultant, had certain supervisory powers over employees of Schrenk’s employer, but Schrenk was not its employee. Sheikhzadeh-Mashgoul filed an application before the B.C. Human Rights Tribunal against Schrenk and Schrenk’s employer, the construction contractor, alleging discrimination in the workplace.
The tribunal found that the B.C. Human Rights Code did not prohibit only an employer or someone in an employment-like relationship with the complainant from discriminating regarding employment. It determined that Schrenk discriminated against Sheikhzadeh-Mashgoul regarding employment, even though they were not employed by the same company, and Sheikhzadeh-Mashgoul as supervising engineer had significant influence over how Schrenk and his employer performed their work.
The tribunal’s decision was upheld by the B.C. Supreme Court but overturned by the B.C. Court of Appeal, which found that only those who have power to inflict discriminatory conduct as a condition of employment can discriminate against an employee. Since Schrenk and Sheikhzadeh-Mashgoul worked for different employers, the Court of Appeal found that Schrenk could not have discriminated against Sheikhzadeh-Mashgoul regarding employment.
An appeal to the Supreme Court of Canada delivered a more expansive interpretation of the law, in line with the tribunal’s decision. The top court found that the code was applicable because it specifically prohibits discrimination “regarding employment,” the language broad enough to create a “sufficient nexus with the employment context,” and therefore not restricting who can perpetrate the discrimination. Determining discrimination is dependent on contextual factors including, but not limited to:
•Whether the perpetrator was integral to the complainant’s workplace
•Whether the discrimination occurred in the complainant’s workplace
•Whether the complainant’s work performance or environment was affected negatively by the discriminatory behaviour.
Since Schrenk was an integral and unavoidable part of Sheikhzadeh‑Mashgoul’s work environment, the Supreme Court found that his behavior amounted to discrimination regarding employment.
Liability for behavior of contractors
The importance of this ruling should not be lost on employers. The days of treating discriminatory transgressions by a loosely-affiliated contractor or service provider with a shrug are gone. If a non-employee contractor, vendor or service provider engages in behaviour akin to that in the Schrenk case, the Supreme Court of Canada has made it abundantly clear that the organization could be held liable, depending on how relevant provisions contained within the human rights code in the respective province is worded. Ontario, Manitoba, New Brunswick, Nova Scotia, and Prince Edward Island human rights legislation contain similarly broad wording to B.C.’s prohibition of discrimination “regarding employment.”
As outlined above, the test for determining liability in cases such as these — and where provincial human rights code language is broad — is contextual: Is the third party’s engagement with the organization significant — for example, does the engagement have an integral impact on your workplace — and does that unwanted behaviour impact the target’s ability to do his job or be employed without the threat of discrimination or harassment? If the answer to either question is ‘yes,’ your organization could be exposed to major employment law risk in the form of human rights complaints, penalties and unwanted government scrutiny.
In some Canadian jurisdictions, policing the behaviour of a non-employee is already within the scope of employers’ obligations to ensure a safe, inclusive workplace, such as the duty of Ontario employers to protect employees from harassment by non-employees. This ruling adds a new layer of complexity to the already-onerous process of managing effective and productive workplace relations. Employers are wise to increase the scrutiny not only of the third-party contractors and service providers they engage, but also those companies’ individual employees. This is particularly important for organizations that have a small core staff but rely on outsourced labour to deliver their products or services.
Going forward, organizations will need to ensure that partner vendors are fully briefed on their workplace policies and procedures, particularly those pertaining to discrimination and harassment. They could (and likely should) go as far as providing training sessions for any individuals who might provide services in their workplace, or interact with their employees. The consequences of violating those policies should be clear, including the severing of business ties with the service provider. Individual employees of the third-party organization should be vetted in much the same way as a prospective employee. Does the individual reflect your organization’s values, approach to business and commitment to an inclusive workplace? If not, the onus is on your HR or recruitment team to work with the service provider to find an alternate individual who can live up to those standards. This process can be streamlined and needn’t be as detailed or as onerous as the recruitment strategy for your part- or full-time employees, of course. But it does need to be consistently applied to avoid legal headaches.
The Supreme Court’s ruling underscores the seriousness with which Canadian employers must treat workplace discrimination and harassment. Those that hadn’t taken it seriously now have another good reason to take action.
Laura Williams is the founder and principal of Williams HR Law, a human resources law firm in Markham, Ont., serving employers exclusively. She can be reached at (905) 205-0496 or [email protected].
