Unvaccinated worker's constructive dismissal claim denied

A Crown corporation did not constructively dismiss a worker when it placed her on unpaid leave for failing to comply with its mandatory COVID-19 vaccination policy during the pandemic, the Canada Industrial Relations Board (CIRB) has ruled. 

The worker started working for Canada Mortgage and Housing Corporation (CMHC), a Crown corporation providing housing finance solutions and access to mortgage funding, in 2011. She eventually took on the role of specialist, securitization policy. 

In 2018, CMHC introduced a program that included a “results only work environment” that gave employees additional control over how and when they worked, with emphasis on the results over hours and work location. The worker went to her local office several times and also worked from home under the program, although she didn’t have a formal telework agreement. 

After the COVID-19 pandemic arrived in March 2020, the worker continued to work at CMHC’s office frequently. 

Mandatory vaccination policy 

On Sept. 22, 201, a few months after COVID-19 vaccines became available to the general public, CMHC informed its employees that it would be requiring employees who accessed a CMHC workplace and whose job duties could bring them into proximity with other people, to be fully vaccinated by Nov. 1. On that date, all employees would be required to attest that they understood the vaccination policy as a condition of employment. 

On Oct. 6, CMHC announced to employees that, as a Crown corporation, it was expected to implement vaccination measures mirroring the federal government’s vaccination requirements. A week later, it implemented new vaccination requirements to match the government’s policy. This required employees to be fully vaccinated or be placed on administrative leave, unless they had a valid exemption under the Canadian Human Rights Act. 

Under the amended vaccination policy, employees who didn’t comply by Nov. 15 and didn’t have a human rights exemption would be placed on immediate leave without pay (LWOP).  

On Oct. 29, CMHC emailed the worker to remind her that she hadn’t completed her mandatory vaccination attesting on its secure online tool and she would be placed on LWOP if she didn’t by Nov. 15. However, four days later, the worker’s lawyer sent a letter stating that unilaterally imposing the vaccination policy was a “fundamental and substantial breach” of the worker’s employment agreement, which might constitute unjust dismissal under the Canada Labour Code.  

The letter also said that the worker wanted to preserve her employment, so she would continue to work from home and submit a COVID-19 rapid test if CMHC required her to come into the office. 

Unpaid leave for noncompliance 

On Nov. 8, the worker completed her attestation, saying that she had chosen not to be fully vaccinated. Two days later, CMHC advised that she would be placed on LWOP effective Nov. 15 if her status didn’t change. On Nov. 11, the worker’s lawyer sent another letter reiterating the worker’s position that the policy might constitute unjust dismissal and she wouldn’t consent to the LWOP. 

CMHC placed the worker on LWOP on Nov. 16, which would be reviewed if the worker demonstrated that she had scheduled vaccination appointments. The corporation confirmed that she would maintain her ability to return to her current position unless she chose to leave her employment. The worker didn’t seek a human rights exemption. 

The worker filed a complaint with Employment and Social Development Canada on Nov. 30, alleging that she was unjustly terminated by CMHC. The worker alleged that CMHC's decision to place her on LWOP constituted a fundamental breach of her employment agreement, thereby amounting to constructive dismissal. She argued that she could perform her duties remotely, negating any health and safety concerns. 

CMHC maintained that its vaccination policy mirrored federal government requirements for Crown corporations, maintaining that the policy was reasonable, consistent with its health and safety obligations under the code, and that the worker’s placement on LWOP was not a dismissal but a consequence of her choice not to comply. 

The complaint was referred to the CIRB. 

Return to work 

On June 14, 2022, CMHC advised the worker that the federal government’s mandatory vaccination requirements were being suspended as of June 20. The worker returned to work in her normal position on June 20, attending the office multiple times. There were no changes to her terms and conditions of employment. 

The CIRB first assessed the reasonableness of the vaccination policy based on the KVP test and found the policy met all the requirements – it was reasonable to protect the safety of employees during the pandemic and to follow the government’s mandate, it was clear and unequivocal in its purpose, it was brought to the worker’s attention in advance along with the consequence of LWOP for noncompliance, and it applied to all employees who could return to work upon compliance. 

The CIRB referred to the test for constructive dismissal outlined by the Supreme Court of Canada in Potter v. New Brunswick Legal Aid Services Commission, 2015 SCC 10, which considers whether an employer's conduct constitutes a breach of the employment contract and whether a reasonable person in the same circumstances would view this as termination. 

Accordingly, the CIRB found that CMHC’s vaccination policy was reasonable, noting that the policy balanced individual employee autonomy with CMHC's duty to protect workplace health and safety during the COVID-19 pandemic. 

Terms of employment unchanged 

The CIRB also found that placing the worker on unpaid leave didn’t substantially alter her terms of employment. The LWOP was temporary and tied to her vaccination status, and she remained free to return to work upon compliance with the policy.  

In addition, there was no evidence that CMHC intended to terminate the worker’s employment, as the corporation maintained her right to return to her job, which she did after the policy was rescinded with no changes to her terms, salary, or conditions of employment, said the CIRB. 

“A reasonable person would have understood that being placed on LWOP was a consequence of their choice to remain unvaccinated, not a termination of employment,” said the CIRB. 

The CIRB concluded that CMHC’s decision to place the worker on LWOP didn’t amount to dismissal under the code. It dismissed the worker’s complaint, confirming that CMHC’s actions were reasonable and consistent with its obligations as an employer. 

See Mata and Canada Mortgage & Housing Corp., Re, 2024 CIRB 1141.