Worker claimed new bosses campaigned to get him out, created toxic work environment
“If an employer has a long-term employee who's over the age of 50 or 60, it should be very mindful about that employment relationship because they're part of why the company is successful. But also, if a court or tribunal thinks that the employer mishandled this employee's termination or sick leave in any way, the employer could be liable for extraordinary damages.”
So says Charles Millar, an employment lawyer at Achkar Law in Toronto, after an Ontario court found that a long-term employee was constructively dismissed after changes in the workplace and his treatment created a hostile work environment.
The worker was employed with the Kingston Area Taxi Licensing Commission (KATLC) in Kingston, Ont., since 2002. He eventually became a taxi inspector, general manager, and municipal enforcement officer.
Throughout his tenure, the worker received positive feedback on his performance. He was eventually given authority to run the day-to-day operations. His duties usually required him to be on the road, with his cellphone number readily available in the office.
In December 2019, there was a change in the KATLC board leadership and the new chair and vice-chair started treating the worker differently. At a board meeting, a regular attendee noticed they were criticizing the worker openly and belittling him. Another board member told the worker that the new chair wanted to get him fired.
Changes in responsibilities, treatment
A short time later, the board chair told the worker not to consult the KATLC’s legal counsel without express permission, while previously he had the authority to do so. When the worker questioned this and other changes, the chair and vice-chair responded aggressively and angrily, and he was reprimanded for making an operational decision when there was no active chair or vice-chair.
The worker expressed concern over how he was being treated, so the KATLC hired a human resources consultant to investigate. About a month later, the consultant reported that she hadn’t found any harassment, but the chair’s “word choice, tone and manner” had been “interpreted as aggressive, inappropriate and disrespectful.” She recommended supervisory and sensitivity training, the appointment of a third-party mediator to help create clear operating procedures, and the assignment of a mentor to the worker.
However, the KATLC didn’t implement any of the recommendations and none of them were communicated to the worker.
KATLC did the right thing by hiring a consultant to investigate, but it was risky to ignore her recommendations, says Millar.
“When you have an employee who's accusing someone in management of harassment, hiring an HR or third-party consultant is a double-edged sword if you're not careful,” he says. “If the consultant issues a report saying there's nothing wrong, that’s beneficial to the employer because it can say, ‘We investigated your complaint, it wasn't substantiated, so let's work together to get back on track’ - but if the report says there are some concerns and the employer ignores that, it’s now evidence against the employer.”
Employer required signing of new employment contract
The worker wrote to the HR consultant and said that his health was deteriorating. However, the KATLC board asked him to sign a new employment contract that limited his termination notice entitlement to employment standards minimums. After receiving legal advice, the worker refused to sign the new contract. The board offered an additional week of termination notice, but the worker still refused.
The worker went on stress leave on April 27, 2021. KATLC retrieved his work equipment and vehicle, and posted his position as open.
The worker sued for constructive dismissal, alleging that the new board leadership implemented a campaign to remove him from his role - including micromanagement, belittlement, and questioning of his ethics and abilities - that created a toxic workplace environment.
The KATLC argued that the worker voluntarily resigned and had committed misconduct and dereliction of duty. The chair and vice-chair alleged that the worker had closed the office during public hours, he hadn’t provided timesheets when requested so the commission could monitor his work, and he didn’t dress appropriately when called to court – the latter leading to a new dress code policy. They also claimed that the worker had a personal construction business and he had damaged vehicles by transporting materials and possibly used company time for this business.
The chair and vice-chair also said that the worker had caused financial loss when he waived administrative fees in 2020 and left “stacks of unsecured confidential documents” in the office exposed to unauthorized access. When he went on medical leave, he didn’t take measures to avoid data losses and disruption, they said.
Worker treated differently by new bosses
The court found the worker to be credible and his account of his treatment and the attitude of the new leadership towards him was corroborated by other witnesses on the board. As a result, the court accepted that, there was a sudden change for the worse in the worker’s treatment at work, said the court.
Looking at the misconduct allegations, the court noted that the worker had not previously been required to submit timesheets and he was easily reachable while on the road, so any concerns about time theft could have been easily addressed. The court also found that criticisms regarding his outfits in court were “petty” and the worker’s decision to waive a fee during the pandemic was within his mandate with no evidence of financial or reputational harm to the KATLC. In addition, the allegations around the mishandling of confidential information weren’t supported by any evidence, the court said in finding that the misconduct allegations reflected a bias against the worker and a desire to replace him, rather than any deficiencies in his work.
When new management comes in with fresh ideas, it can keep the company healthy but employers have to be careful in how it's done, according to Millar.
“If you shake things up too much and you’re not respectful of the longstanding employees who are already there – and who are the reason why the company is successful - you run the risk of a constructive dismissal case where the people feel as though they're being abused by the changes,” he says. “In this case, the evidence showed that the two new board members were quite inappropriate towards the worker - I think it was the right thing to introduce new ideas and new blood, but they went about it the wrong way by being far too aggressive in their demands and not being respectful or collaborative with the people who were already there.”
Worker proves constructive dismissal
The court determined that the worker had met the onus of proving constructive dismissal, finding that the new leadership created a hostile work environment. The court also found that the KATLC acted in bad faith by insisting on a new employment contract with a termination clause that would allow dismissal with “little more than the bare minimum required by law” after so many years of service.
“As an employer, it can be good to introduce new employment agreements, perhaps annually, but again, [KATLC] went about it the wrong way,” says Millar. “They introduced it when the worker was complaining about being bullied in the workplace - they didn’t ‘read the room’ to realize that it wasn’t a good time.”
Noting that the worker was 61 years old at the time of his constructive dismissal with 19 years of service, the court found that a 24-month notice period was appropriate.
The worker’s age and the specialized nature of his role was a sticking point and why the reasonable notice period was so high, says Millar.
“If he was a bit younger, like 40 years old, with 20 years of experience, then you might see something closer to the 18- or 19-month mark, but his age and the unique leadership position he was in really played a role in increasing it to the 24-month soft cap,” he says.
24 months' reasonable notice, aggravated damages
The KATLC was ordered to pay the worker 24 months’ pay and benefits – more than $160,000 - minus what the worker earned at another job during the notice period - just over $35,000. The court also awarded $25,000 in aggravated damages for the stress and anxiety the worker experienced that required medication and from which he had not yet recovered at the time of trial.
When an employer wants to implement new ideas and processes, the execution is just as important as the idea, says Millar.
“It would be very important to get some legal advice and consulting to help a company implement ideas, especially big ideas that may ruffle a few feathers,” he says. “You have to be cautious and you can’t just strong-arm changes into place – there’s a professional, calculated way of doing it that will spare the company a lot of headaches and actually make for a positive workplace – good ideas are only good if they're implemented well.”
