Former employee threatened to damage employer's reputation, claiming unpaid wages
A former employee who threatened to damage his employer's reputation with clients and government agencies unless paid outstanding wages has lost his appeal in Ontario.
The Court of Appeal upheld a defamation ruling that rejected the individual’s claims of public interest whistleblowing.
Justice Edward Morgan's decision, affirmed by the appellate court, found that Zhuo Chen's communications to Diverse Transportation's major clients and the Ministry of Transportation were fundamentally about his employment dispute rather than legitimate workplace safety concerns.
When severance disputes go public
Chen left his position at Diverse Transportation and subsequently made claims for unpaid wages and other amounts he alleged the company owed him. His approach to collecting these wages, however, went beyond typical employment dispute channels.
Chen threatened to send “damaging” communications to Diverse Transportation's clients and others if payment was not made. He said that if payment were made, he would not send the threatened communications. Payment was not made at that time.
Chen then followed through on his threats, sending damaging communications to Diverse Transportation's most important clients and the Ministry of Transportation, claiming that the company had engaged in harmful and unsafe practices and was a bad employer.
Safety claims as bargaining chips
In all of these communications, Chen referenced his employment dispute along with the health and safety and other allegations. The motion judge examined whether these communications qualified for protection under anti-SLAPP legislation, which is designed to prevent lawsuits that stifle legitimate public participation.
Justice Morgan characterized the true nature of Chen's communications as being about his employment dispute rather than a matter of public interest. He found that there was no basis for Chen's health and safety and other allegations.
The Court of Appeal agreed that it was open to the motion judge to accept Diverse Transportation's evidence that "none of its practices related to wash tickets gave rise to health or safety concerns nor that it engaged in improper employment practices."
Court draws line on employee retaliation
The courts rejected Chen's attempt to frame his actions as protected public interest expression. Justice Morgan found that the defamation action was "aimed at vindicating [the employer’s] business reputation and [had] nothing whatsoever to do with stifling public participation or blocking information that [the appellant] says the public had a right to know."
The motion judge concluded there was "no public interest in the form of debt collection and redress presented by the record" and therefore there was “nothing to weigh against the prevailing public interest in claimants taking an alleged wrong to trial."
The Court of Appeal found Diverse Transportation "would have no trouble at all in meeting its burden to prove that [Chen’s] statements about it were false, indefensible and harmful to its business reputation." Chen was ordered to pay $50,000 in costs at the motion level and an additional $15,000 for the appeal.
