B.C. court finds insurance firm's mishandling of employee's stalking complaint contributed to wrongful dismissal
The Supreme Court of British Columbia has ruled that an insurance brokerage wrongfully dismissed a longtime employee after her manager's inadequate response to years of stalking by a client's representative contributed to the mental health injuries that ultimately ended her career there.
In reasons for judgment released July 6, 2026, Justice L. Bennett found in favour of the employee in her wrongful dismissal claim against Johnston Meier Insurance Agencies Ltd. (JMI), awarding $116,136 in damages.
The individual worked as an insurance producer at JMI for roughly seven-and-a-half years, hired in 2014 by branch manager David Ebner, who remained her manager until her termination on September 16, 2022.
Stalking, harassment by client
According to the decision, the employee was stalked and harassed for years by a representative of one of her clients. She raised the issue with Ebner early on and, with support from him and other staff, put safety measures in place at work.
By the summer of 2021, the court found, the stalking had intensified: the individual waited for the employee in her workplace parking lot, loitered near her home, and eventually followed her vehicle on the highway. She contacted police, who told her there was little they could do unless the man trespassed on her property.
In August 2021, the employee emailed Ebner to lay out the escalating situation and seek his help. She told him she didn't want the firm to lose the client's business or the associated income, but worried the situation could worsen regardless. Ebner responded sympathetically and said he would consult his wife, Colleen Ebner, who he said was "very good at this kind of thing."
The court found that Ebner did not follow up meaningfully after that. Weeks later, the employee learned in an unplanned encounter that he had not yet spoken to his wife about it; when the conversation did happen, she found Mrs. Ebner's advice dismissive. Meanwhile, the court found, the employee’s mental health deteriorated to the point of suicidal ideation.
Pay dispute and escalation
In September 2021, Ebner called her into a meeting she expected to be about her stalking concerns but which instead focused on reducing her monthly pay draw, citing falling ICBC commission rates. She disputed the need for a reduction but reluctantly agreed to revisit it in the new year.
The employee then raised her stalking concerns in the same meeting; the court found Ebner became visibly angry, and when she asked to work temporarily from a property she owned elsewhere in the province, he refused and threatened to take away her administrative assistant if she did so.
Days later, and without notice, the employee discovered her pay had been cut from $10,000 to $7,000 per month. The court found Ebner could not adequately explain the reduction and eventually agreed to partially reverse it. When she later requested a week of vacation — something she said she had not done in her entire tenure — Ebner told her to drop her "attitude."
The employee went to human resources, where the HR manager directed her to the Workers' Compensation Board of British Columbia (WorkSafeBC). Her last day of work was Oct. 4, 2021. The stalking continued during her leave, including an incident in which the individual appeared at her front door.
The employee was ultimately found eligible for long-term disability benefits. In August 2022, WorkSafeBC determined she had suffered permanent post-traumatic stress disorder and major depressive disorder connected in part to both the stalker's conduct and Ebner's handling of the situation, and concluded she was permanently restricted from returning to work with JMI, the stalker's employer's account, her former manager, or her original work location.
JMI terminated her employment on Sept. 16, 2022, citing frustration of contract.
Wrongful dismissal
The central legal question was whether JMI could rely on the doctrine of frustration of contract — which, if established, would have meant the employee was not wrongfully dismissed. Assessing witness credibility, the court found her "credible and reliable" throughout, while Ebner's evidence "lack[ed] both credibility and reliability" — he denied facts directly contradicted by documentary evidence, including denying he'd discussed a pay cut before payroll records showed he'd already ordered the reduction a day earlier.
The HR manager’s evidence was found "internally inconsistent."
The court concluded Ebner had both a moral and statutory duty under the Workers Compensation Act to protect the employee’s health and safety, and that his failure to act, combined with the pay reduction and dismissive response to her vacation request, contributed to her inability to return to work — meaning the frustration defence failed and the dismissal was wrongful.
The court awarded nine months' pay in lieu of notice, calculated from Hedrick's average monthly income over her final three years ($12,904/month), totaling $116,136. It declined aggravated or punitive damages, finding JMI's conduct "insensitive, unprofessional, or improper" but not "malicious, oppressive and high-handed."
WorkSafeBC benefits paid after her condition was deemed permanent (August 29, 2022) were found non-deductible, as was any reduction for failure to mitigate, given her PTSD and depression diagnoses.
