Broken promises lead to reprisal

An employer’s decision to lay off and then terminate a worker after telling her she would have an ongoing role in a restructuring was a reprisal for a harassment complaint, the Ontario Labour Relations Board has ruled.

If the worker was going to be laid off, then there shouldn't have been any discussions with her, because then the employer had the obligation to show that the layoff had no correlation to her harassment complaint,” says Chantel Goldsmith, an employment and labour lawyer at Samfiru Tumarkin in Ottawa and Toronto.

“And because they weren't able to demonstrate that effectively, that's when it ended up being considered a reprisal.”

Layoff period announced

The worker was a portfolio administrator in Toronto for IA Clarington Investments (IAC), an investment management company. Hired in 2018, she reported to IAC’s manager of investment operations.

In July 2020, IAC announced a restructuring of its administrative operations that affected about 90 employees including the worker. The company advised the worker that it would be transitioning its fund administration services to an external provider over the course of 24 to 30 months, but her role was “identified as critical” and she would receive a retention bonus for working through the completion of the transfer.

The company also told the worker that, at the end of the transfer, there would be “a layoff period and you will remain employed… for a maximum of three months.” During the layoff period, IAC would continue her salary and benefits while trying to redeploy her.

Ongoing role suggested

In September 2020, the worker started reporting to another manager. On Oct. 5, 2021, the worker met with managers who asked her if she was interested in staying for the full transition period with the possibility of another role after that. The worker expressed her interest.

On Oct. 21, the worker raised concerns about the behaviour of her former boss, with whom she still interacted. She met with her current boss to discuss her concerns and IAC decided to hold a mediation.

The worker also started receiving additional duties and training to prepare her for the new work that was mentioned to her in the Oct. 5 meeting.

A mediation was held on Nov. 12 and the worker said she felt that her former boss had violated IAC’s code of conduct and respectful workplace policy. The mediation wasn’t successful, but the worker declined to make a formal harassment complaint because she felt that everyone was aware of the situation.

The worker later emailed HR with more examples of harassing behaviour from her former boss and the company launched a formal investigation. The investigators met separately with the worker, her former boss, and another manager.

Notice of layoff given to worker

On Dec. 13, the worker was advised that she was being laid off because her current position would be eliminated as of Jan. 17, 2022. The layoff letter stated that she would be laid off for no more than three months, during which the company would look to reassign her. It also said that she would be automatically considered for a position that required her experience and skills, and he she refused a compatible position it would be considered a resignation. If no appropriate position was found during the layoff period, IAC would terminate her employment with statutory severance pay.

A colleague of the worker who had also been notified of the three-month layoff was offered an ongoing position lasting up to a year with an additional retention bonus, and was told that further reassignment would be sought.

The worker believed that the layoff was a reprisal for her harassment complaint and told the investigators. On Jan. 5, 2022, she told HR that she was no longer interested in an alternative position with IAC and she would look for an external job. She told her boss a week later but said that she wasn’t resigning.

However, IAC treated it as a resignation and terminated her employment on Jan. 21. The termination letter stated that the company was still prepared to give her a settlement package if she signed a “full and final release,” but the worker refused. IAC paid her the statutory minimum and retention bonus for the first phase of restructuring.

The worker made a complaint to the board alleging that she was reprised against for exercising her rights under the Ontario Occupational Health and Safety Act (OHSA) when she made the harassment complaint.

“The employer did the right things by meeting with the parties, trying to mediate and listening to the complaints, but the issue was around the timing,” says Goldsmith. “She was terminated approximately three months after she had made her complaint of workplace harassment and four months after they had made assurances to her that she would continue to have some further work during this restructuring period.”

No formal complaint: employer

IAC maintained that the worker was laid off and terminated in the normal course of business. It also said that she didn’t exercise her rights under the OHSA because she didn’t make a formal complaint, as the investigation was initiated by the company. It also argued that her complaint didn’t relate to any actual harassment under the OHSA.

The board found that, although the worker didn’t make a formal harassment complaint under IAC’s anti-harassment policies, she still raised harassment concerns and was seeking protection under those policies. That complaint led to mediation involving HR, where the worker accused her former boss of violating the policies. She later sent more examples of harassing behaviour that led to IAC mounting an investigation, said the board.

The board also found that it didn’t matter if the manager’s behaviour was ultimately workplace harassment, as the issue was whether the worker was engaging in activities protected by the OHSA. Since the worker triggered the investigation process under IAC’s policies, she was engaged in protected activities, the board said.

Although IAC argued that the worker wasn’t offered a specific job, she was told she would still be needed, the board found. Instead, she was terminated just over one month after her layoff letter – well before the end of the three-month layoff period – which constituted adverse consequences, said the board, adding that the layoff letter was a threat to dismiss followed by actual dismissal.

The board noted that the worker was told on Oct. 5, 2021, that she was needed in some capacity throughout the restructuring, but on Dec. 13 was “redundant when her prior duties ended.” The only material change between the meeting and the “sudden layoff and early termination” were the worker’s complaint and the resulting harassment investigation, the board said, adding that IAC didn’t provide a satisfactory explanation for either the layoff or early termination.

Burden of proof on employer

“The burden of proof is always on the employer in a reprisal application, and [IAC] did not meet their burden, which was to prove on a balance of probabilities that the decision in question was not connected with [the worker’s] protected activities relating to the harassment complaints,”
says Goldsmith.

IAC’s reassurances in that Oct. 5 meeting made it hard for the company to prove that its change of position wasn’t because of the harassment complaint, according to Goldsmith.

“There was no new job promised to her or what that job would be, but she was advised at that time that she would have additional duties and responsibilities and more involvement beyond just the initial restructuring process,” she says. “I think that that was the biggest misstep for the employer in this case, because it was after they had communicated that to her that she brought forward her workplace harassment concern.”

The board determined that the worker’s protected activities under the OHSA, on a balance of probabilities, played a part in IAC’s decision to lay off the worker. As for the early termination, it was a direct consequence of the layoff so it wasn’t necessary to determine if it was a reprisal, the board said.

Goldsmith notes that a termination or disciplinary action can’t be tainted in any way by a motivating factor related to protected grounds under the OHSA, even if there are legitimate business reasons.

“[IAC] had to demonstrate that there was absolutely nothing involved with respect to the workplace harassment complaint, and then they'd have to be able to show all the reasons why this person was going on layoff was outside of that,” she says. “Because that October discussion gave her some reassurance that she was going to continue to have some employment with the company and that they were hoping to redeploy her, the timing supported that [the layoff] had been tainted by her complaint.”

A separate hearing was to be held to determine the remedies for IAC’s violation of the OHSA. See Randi Libman v. iA Clarington Investments Inc., 2023 CanLII 129070.