Power imbalance, lack of advice, small settlement amount offered all factors in making agreement unfair to harassed worker
A British Columbia woman who signed a settlement agreement stating she would drop a human rights complaint for sexual harassment by her employer in exchange for $800 will be able to continue with the complaint, the B.C. Human Rights Tribunal has ruled.
The 24-year-old female worker joined the employer in May 2017 in a position cleaning recreational vehicles (RVs). The employer shared a parking lot with another business that also had jobs for the worker — owned by a man referred to as Mr. S. — so she accepted work from the owners of both businesses on an on-call basis.
A few weeks into the job, on June 3, the worker was alone in the RV lot with the owner of her main employer — who was a 62-year-old man — when the owner asked about her tan and jokingly asked if there were any condoms in the cars she was cleaning. A short time later, the worker was inside an RV cleaning it when the owner entered the vehicle and said she needed a massage. The worker laughed it off, but she later testified the owner reiterated that she needed a massage and told her to lie down on the bed. The worker replied that she needed to finish her work and get home to her son — the worker was a single mother with a young son, and this was her first job since her child was born.
However, according to the worker, the owner was persistent and started rubbing her leg, telling her she could finish cleaning the RV later and to lie down for a massage. The worker told him no once again, but relented out of fear and anxiety and lay down on the RV’s bed. The owner started rubbing the worker’s shoulder and she jumped up, but the owner then made a comment about her underwear. The worker testified the owner then grabbed her waistband and looked down her pants. Her phone then rang and she quickly exited the RV.
The worker reported the owner’s behaviour to the owner of the second business in the lot, Mr. S., and said she was going to report it to the police. A few days later, the first owner apologized to her and Mr. S. told her they could work things out without involving the police, saying the first owner wanted to give her an RV to live in and pay for three months’ rent.
The worker returned to work for one day, but the owner kept coming in and out of the RV when she was cleaning, which made her uncomfortable. She left work and didn’t return.
The worker filed a human rights complaint for sexual harassment on July 17, seeking an apology and compensation for lost wages and damage to her mental health. Four days later, Mr. S. offered her some cleaning work, which she accepted. While she was working, Mr. S. told her that his friend wanted to get to know her the way her employer’s owner “wanted to get to know her.”
A couple of weeks later, Mr. S. again contacted the worker to offer her work. The worker declined, but communicated with him over a period of one week regarding the human rights complaint. According to the worker, Mr. S. kept trying to minimize the incident, saying it wasn’t a big deal and the owner didn’t know any better. He eventually offered the worker $500 if she dropped the complaint and resolved things between them.
The worker said $500 wasn’t enough and she also wanted a guarantee she wouldn’t be fired, as she was still considering going back to work. She met with Mr. S. in person and refused to sign a settlement agreement with the $500 payoff.
A short time later, Mr. S. increased the settlement offer to $800, which the worker accepted. The worker met with the owner and signed the agreement after accepting the money. The agreement stated that in exchange for the $800, the worker would “discontinue any and all actions against (the owner) and or (the company) including complaint with B.C. Human Rights Tribunal.”
The next day, the worker texted Mr. S. about returning to work, but he responded: “Work? What work? Work there? Where’s there — there is there.” The worker felt she was being mocked and never returned to work for either Mr. S. or the owner. She informed the tribunal that she wanted to continue with the complaint, which the owner challenged because she had signed an agreement stating she would drop it.
The tribunal recognized that the allegations of sexual harassment were serious and accepted the worker’s claim that she suffered from depression and anxiety because of the harassment. Conversely, the language of the settlement agreement was clear that both parties intended to resolve the complaint, said the tribunal.
However, the tribunal found there was “an unequal power dynamic between the parties.” The worker was relatively young and was a single mother depending on her income from her job to support herself and her child — as it was, she was receiving income assistance and living with her father. She was suffering from depression and anxiety stemming from the harassment at the time the settlement agreement was proposed to her and she testified she was confused and not thinking clearly. Meanwhile, the owner was a 62-year-old who was the president of his own company with the power to hire and fire, said the tribunal.
“In my view, there is a large power differential between these two parties, which was exacerbated by the challenges that the employee was facing during the relevant timeframe in respect of her mental health, her finances, and her housing,” the tribunal said.
The tribunal also found the worker was alone with the owner when she signed the agreement and while she had some legal advice, she wasn’t given the opportunity to review the actual agreement or possible remedies under the B.C. Human Rights Code with her advocate. As a result, the worker didn’t receive proper advice about the significance of signing the release, the tribunal said.
Finally, the tribunal found the agreement was “substantially unfair,” as the employee only received $800 for withdrawing her human rights complaint — much less than what she would likely receive for a successful complaint in addition to the lost wages from not returning to work. The worker wanted reassurance she would still have a job, but there was no mention of continued employment or compensation for lost wages in the agreement.
The tribunal determined the worker’s complaint could proceed — first through mediation and then in a hearing if the mediation was unsuccessful. The tribunal noted that the worker’s failure to pay back the $800 in order to pursue the complaint could be resolved as part of the negotiation or any award. See The Employee v. The Company and the Owner, 2017 CarswellBC 3445 (B.C. Human Rights Trib.).
