'Misconduct and a racist motivation could co-exist'
A British Columbia Court of Appeal panel has unanimously dismissed the City of Nanaimo's challenge to a landmark racial discrimination ruling, confirming that an employer can be held responsible for acting on a biased complaint — even when decision-makers were unaware the bias existed.
The May 2026 ruling in Nanaimo (City) v. Mema closes the final chapter of a legal saga that began when a Black employee, Victor Mema, the City's CFO, was suspended then fired in 2018. The BC Human Rights Tribunal found in 2023 that racial stereotypes had infected a misconduct report filed by a co-worker, and that the City's reliance on that report without adequate investigation rendered both decisions discriminatory.
It awarded Mema more than $633,000 in compensation.
The City petitioned the BC Supreme Court for judicial review, arguing the Tribunal's finding was unreasonable. That petition was dismissed in June 2025, and the appeal court agreed.
Writing for a unanimous three-judge panel, Justice Gomery addressed the City's core argument directly: that subconscious bias in a complaint filed by an employee cannot be attributed to the employer, since management had no control over what a colleague believed or wrote.
The court rejected that reasoning entirely.
"While it is true that the City has no control over the subconscious biases that may motivate employee complaints, it is in control over how it handles complaints, and the decisions it makes in reliance on them," Justice Gomery wrote.
"In choosing to take action based on an employee complaint without full investigation, it assumed the risk that the complaint rested on an insecure foundation."
Discriminatory assumptions
The Tribunal had found the misconduct report — which laid out allegations about Mema's corporate credit card use and other financial matters — was built around a pattern of suspicion that went far beyond the known facts. It concluded the report worked to "paint Mr. Mema's use of his P-card as something much broader and more sinister," driven at least in part by stereotypes associating Black men with dishonesty.
An independent KPMG forensic audit had previously found no fraud or criminal activity connected to the P-card use.
The City also argued the Tribunal had failed to properly weigh Mema's own conduct and his position of public trust as a chartered professional accountant. The appeal court found that argument missed the point.
"It matters not whether Mr. Mema's conduct may have given the City cause to terminate his employment at common law because a termination with cause may nevertheless contravene s. 13(1)(b) of the Code if it is racially motivated," Justice Gomery wrote.
"Misconduct and a racist motivation could co-exist. Only the presence or absence of the latter was relevant."
A warning to employers
For employers, the decision reinforces the warning established by the 2023 Tribunal ruling: receiving a complaint does not end the employer's obligations, it begins them.
Sheila Mecking, partner at Stewart McKelvey, clarifies that warning, placing it squarely in the hands of HR to navigate.
"This case provides a warning to employers that when a complaint is received, it is important to properly investigate and view the complaint through multiple lenses, including whether biases played a factor in filing the complaint," Mecking said.
“If HR receives a complaint that a colleague is behaving aggressively, and the colleague is a Black man, an astute HR manager would question whether the complainant is perhaps unconsciously judging the behaviour through a biased lens that stereotypes Black men as aggressive.”
The appeal ruling makes clear that warning now carries the weight of appellate authority. An employer that forwards a complaint directly to a decision-making body — as the City of Nanaimo did when it took the misconduct report straight to Council — without examining the complaint's foundations may find itself liable for whatever bias was baked into it.
The Court of Appeal also confirmed that the standard for proving racial discrimination does not require proof of intent, nor does it require race to be the sole reason for adverse treatment.
Under BC's Human Rights Code, a complainant need only show that a protected characteristic was a factor, not the only factor. On the evidence before the Tribunal (which included a Councillor's testimony that the union president had texted references to Mema as a "criminal" and "those kinds of people") that bar was sufficiently met.
