Case looks at how employers should handle malicious or false complaints by ex-employees
Exclusive to Canadian HR Reporter from Rudner Law.
Every now and then, an employer client seeks advice on whether they could bring a claim against an employee (or ex-employee). Sometimes, this question is brought up in the context of employees making false or malicious statements, such as malicious reviews on sites like Glassdoor or social media posts.
A current employee should be disciplined for that type of misconduct, whereas a former employee could be sued for defamation.
But can an employer sue an employee who makes a malicious or false complaint to a regulator?
That was a central question in Geopro Consulting Ltd v. Nyland. The short answer is no.
Complaint to regulatory body
In Geopro, the employer dismissed the employee for cause just six months into the relationship. Sometime in 2021, the ex-employee made a complaint to the Professional Geoscientists Association of Ontario (PGO), a self-regulating body that investigates the conduct of its members; both the employer and employee were PGO members.
On Dec. 22, 2022, PGO advised the employer that it was investigating a complaint.
The employer realized that the ex-employee participated in the investigation, and claimed that he provided false and misleading information as retaliation for being dismissed. On April 24, 2023, the employer sued the ex-employee for $150,000 in damages, and later sought to amend the claim to seek a total of $1 million in damages.
The ex-employee’s position was that his statements to PGO were all covered by the doctrine of absolute privilege. Accordingly, the employer’s allegations regarding his statements to PGO were not justiciable and raised no cause of action; the court agreed.
The privilege is all mine
Absolute privilege protects persons from being sued for what they say in “proceedings with high social value or utility”, such as regulatory proceedings, including investigations conducted by quasi-judicial bodies (for example, bodies given statutory powers to investigate complaints and mete out discipline).
Since the PGO is a quasi-judicial body, absolute privilege applies to all statements in connection with investigative or disciplinary proceedings, even if the statements are irrelevant or malicious. Accordingly, the ex-employee’s statements regarding PGO’s investigation were covered by absolute privilege, and he could not be sued for making them — even if they could be proven to be malicious.
As a result, the pleadings relating to the defendant’s alleged representations to PGO were struck.
Geopro confirms that the law regarding absolute privilege is clear. When a regulator engages in investigations or discipline, it is quasi-judicial. Complainants (and witnesses) cannot be sued for what they communicate to these bodies during proceedings.
This is so even if the statements are false or malicious, because the purpose of the doctrine is to protect individuals acting in good faith from being intimidated by vexatious lawsuits.
Protections of absolute privilege
Employers who have legitimate concerns about the statements an individual makes would have to raise those concerns within the investigatory or disciplinary process. As Geopro shows, it is improper to bring a claim against someone for making a complaint to a regulator or participating in procedures.
The protections afforded by the doctrine of absolute privilege are substantial. We advise employers against suing employees for making a complaint to a regulator. This is particularly true where the complaint is pursuant to the Employment Standards Act, or the Occupational Health and Safety Act. Not only would absolute privilege apply, but acting against an employee invokes the spectre of reprisal and bad faith.
Proper legal guidance is indispensable when responding to regulatory complaints. Rather than incurring unnecessary legal fees, and risking damages and costs awards, working with HR counsel to respond to regulatory complaints will save employers significant amounts.
David Gelles is an associate lawyer at Rudner Law in Toronto. He can be reached at (416) 864-8500 or [email protected].
