Personal harassment liability always a danger for employers

Only Quebec and Saskatchewan workers have statutory protection but employers in other provinces can be nailed by the courts

The treatment of employees in the workplace has received significant attention by both government lawmakers and the courts within the last decade, particularly in relation to personal harassment or bullying by co-workers or employers. Recent legislation introduced in Saskatchewan relating to “psychological harassment” in the workplace has revived the discussion on the liability employers face for personal harassment. Saskatchewan is only the second province in Canada (Quebec was the first) to enact legislation designed to protect employees in this area. The questions this raises are: what do these provisions protect against and what, if any, protections exist for employees in other provinces?

Quebec was the first province in Canada to enact legislation specifically prohibiting psychological harassment, passing the Act Respecting Labour Standards. Under this legislation, every employee has a right to a work environment free from psychological harassment. Further, employers are required to take reasonable action to prevent it and to put a stop to it when it happens.

Psychological harassment is defined to include any aggravating behaviour in the form of repeated and hostile or unwanted conduct, such as verbal comments, actions or gestures that affect an employee’s dignity or psychological or physical integrity and results in a harmful work environment.

Since the adoption of these provisions in Quebec, there have been thousands of complaints, but few reported decisions. The best known is Ganley v. 9123-8014 Quebec Inc. (Subway Sandwiches & Salads). Ganley filed a complaint with the Quebec Labour Standards Commission alleging psychological harassment after her boss verbally abused her in front of restaurant clientele, criticized her sexual orientation and terminated her while she was on sick leave. The Quebec Human Rights Commission found the employer’s conduct was malicious and violated the psychological integrity and dignity of the employee. The termination was set aside and Ganley was reinstated.

Statutory Protections – Saskatchewan

Saskatchewan has also stepped into the legislative arena in this area. However, rather than amending its human rights legislation, Saskatchewan has amended the Occupational Health and Safety Act, which will expand the definition of harassment to include inappropriate conduct, display or gestures by a person that “adversely affects the worker’s psychological or physical well-being and that the person knows or ought reasonably to know would cause a worker to be humiliated or intimidated.” The definition excludes reasonable criticism, as was done in Quebec. According to the Saskatchewan legislation, all employers must develop, in consultation with the occupational health committee, a written policy to prevent harassment and post it in the workplace.

As the legislation has not yet been proclaimed in force, there have not been any decisions interpreting it.

Common law protection

While the legislation in Quebec and Saskatchewan provides statutory protection, employees in other provinces are not without remedy for similar behaviour. The most often cited case in this regard is Shah v. Xerox Canada Ltd., decided by the Ontario Court of Appeal. Viren Shah, a long-term employee, began working with a new manager that was highly authoritarian, impatient and intolerant in his management of Shah. As a result of the work conditions, Shah became ill and could not return to the workplace. He requested a leave of absence (which was denied) and he was placed on probation. In response, Shah submitted his resignation and subsequently claimed he had been constructively dismissed.

“The test, I believe, is objective: it is whether the conduct of the manager was such that a reasonable person in the circumstances should not be expected to persevere in the employment,” the trial judge said. “An employer is entitled to be critical of the unsatisfactory work of its employees and, in general, to take such measures — disciplinary or otherwise — as it believes to be appropriate to remedy the situation. There is, however, a limit. If the employer’s conduct in the particular circumstances passes so far beyond the bounds of reasonableness that the employee reasonably finds continued employment to be intolerable, there will, in my view, be constructive dismissal whether or not the employee purports to resign.”. More recent decisions have extended this principle to also include inappropriate behaviour of co-workers.

The decision in Shah, which is by no means an isolated case, demonstrates non-legislative protections also exist for employees who are bullied or harassed in the workplace.

The difference between the common law and the legislation is the remedy. The legislative protections provide a “make whole” approach, which attempts to put the employee back into the position she would have had if the problem had not occurred, irrespective of her age, years of service or position. This would include reinstatement and back wages, as well as general damages.

In contrast, a court would be providing a remedy for breach of contract and awarding reasonable notice based on age, years of service and position. A court may also award an extended notice period because of bad-faith actions of the employer, damages for mental distress and punitive damages. While the quantum of these damages has increased substantially in the last five years, a court would not order reinstatement. Employers should recognize significant remedies exist for the bullied employee, whether that protection is through legislation or common law. Employers outside Quebec and Saskatchewan are not insulated from liability for personal harassment because their province does not have similar legislative protections.

Tips for employers

Employers must remain aware of their liability and should take steps to reduce their risk when complaints of personal harassment are made. In this vein, employers should:

• develop a harassment policy which specifically references personal/psychological harassment such as gossiping, bullying and inappropriate behaviour towards co-workers/subordinates;
• specify (in the policy) legitimate performance reviews and performance improvement plans do not constitute harassment;
• train employees and managers on what the policy means and requires;
• make employees aware any violation of these policies will result in discipline up to termination and it should be enforced consistently; and
• have in place a method to receive and investigate complaints to ensure incidents of personal harassment are dealt with appropriately.

For more information see:

Ganley c. 9123-8014 Québec inc. (Subway Sandwiches & Salades) and. 9155-9047 Québec Inc, 2006 QCCRT 0020 (Que. Lab. Rel. Comm.).

Shah v. Xerox Canada Ltd., 2000 CarswellOnt 831, (Ont. C.A.).

New manager causes new headaches for Xerox worker

Quebec and Saskatchewan are currently the only jurisdictions in Canada which have statutory protections against psychological harassment in the workplace. While other jurisdictions don’t have formal legislation yet, there are still protections available for workers.

A prominent case involving psychological harassment was affirmed by the Ontario Court of Appeal. Viren Shah starting working for Xerox Canada in Toronto in December 1983. After several successful years at the company, he took on the position of technical support analyst in May 1995.

Shah’s new manager complained about his performance in November 1995, saying he was not completing certain tasks. Shah was surprised as he hadn’t been given specific deadlines for the tasks in question. On March 18, 1996, he received a warning letter threatening dismissal but the charges weren’t clearly explained.

Shah became ill shortly thereafter and missed several days of work. On May 13, 1996, he was assigned several tasks which other employees hadn’t been able to deal with with unreasonable deadlines. He was given another warning letter and told any future absences would require a doctor’s note and prior approval.

On May 17, 1996, Shah was put on probation and his manager became “more authoritarian, impatient and intolerant.” On May 21 Shah resigned and sued for wrongful dismissal.

The court agreed with the trial judge’s finding that the performance concerns raised by the manager were not directly tied to Shah’s actual responsibilities and the warning letters he received were unjustified. It found Xerox put Shah on probation without proper explanation and didn’t give him an opportunity to respond to the criticism.

“Xerox’s treatment of Shah demonstrated that it no longer intended to be bound by the employment contract,” the court said. It ruled Xerox had made Shah’s position “intolerable” and constructively dismissed him.

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