Current Issues in Employment Law B.C. Legal Management Association - - PowerPoint PPT Presentation

Current Issues in Employment Law

B.C. Legal Management Association October 8, 2014 Richard Press 604.643.6444 Davis LLP

Agenda

• Reference Checks
• Diversity and Privacy
• Performance Management in the Age of Harassment
• The Hostile Work Environment
• WSBC Harassment Issue Update

The secret to working for the Earl

• f Grantham?

A strong reference from a peer

REFERENCE CHECKS

Must You Provide a Reference?

• No
• An earl could not be

compelled to praise an unsuitable employee

What About Today?

• Social mores have shifted.
• An unreasonable refusal

to provide a reference will be sanctioned

Liability For Not Providing A Reference

• Extended notice period
• Moral damages
• Punitive or aggravated damages

Liability for Providing A Reference

• If the reference is false or misleading:
• Extended notice period, moral damages, aggravated or

punitive damages

• Defamation
• Misrepresentation claim
• Liability still arises from a false reference made in good

faith

What to Do?

• Let’s look at the

pros and cons

References - Pros

• Increase likelihood of mitigation
• A reference helps an employee get

a job

• A job mitigates potential damages

References - Pros

• Impresses a court
• No chastisement for failure

to provide a reference

• Affirms employer acting in

good faith

References - Pros

• Generates goodwill

with employee

• Employee less likely

to bring an action against a reference

References - Pros

• Assists with privacy issues
• Provides script for verbal references

References - Cons

• Relationship at termination may be poor
• Employee’s performance may belie even a marginally

good reference

References – Cons

• Possible liability for false or misleading statements
• Liability uncertain in Canada
• No cases quite there yet in Canada
• American cases do exist

What is a False or Misleading Statement?

• Chronically absent?
• A man like him is hard to find
• It seemed her career was just taking off
• Dishonest?
• He's an unbelievable worker
• Her true abilities were deceiving

(Just in case you need these)

• Unproductive?
• You would indeed be fortunate to get this person to work

for you

• All in all, I cannot say enough good things about this

candidate or recommend him too highly

• Alcoholic?
• Every hour with him was a happy hour
• We often found him loaded with work do to

Verbal References – Pros and Cons

• Same pros as for written references
• Cons are increased privacy concerns

Top 10 Take-A-Ways

• 10. Offer a Reference

9. Copy the Employee 8. Centralize 7. Do Not Leverage

Top 10 Continued

6. Be Consistent 5. Quote Yourself 4. Do Not Mislead (including by omission) 3. Written References Are Scripts

Top 10 Continued

2. Consider Waiver and Consent 1. Communicate

DIVERSITY AND PRIVACY

• Data collection and use
• Diversity metrics

Why Track Diversity?

• The US does it
• US clients may demand the same information from

Canadian suppliers

• The Federal Government requires it for large contract

suppliers

• Federal Contractors Program (FCP)
• > 100 employees + > $1m contract

Risks for Implementing Diversity program

• Human rights complaint
• Allegation diversity data used for employment reason
• Privacy complaint
• Reasonableness of collection
• Safeguards to data
• Use and disclosure of data
• Costs and resources in collecting data

Hurdles to Tracking Diversity in Canada

• Lack of legislative support
• Lack of infrastructure
• Lack of data analysis

Lack of Legislative Support

• Lack of legislative scheme requiring businesses to

contract with minority suppliers

• Employment equity in other provinces, but does not

require supplier compliance

Special Programs

• BC human rights legislation allows for “special

programs”

• Special programs allow discrimination to favour

minorities

• For example, can give preferential hiring to aboriginal

persons

Special Program Applicability

• Not sufficient for the business to hold an intent of ameliorating

historical discrimination or to implement such a special program in good faith.

• Business must either apply to the applicable human rights body in

advance for permission or be prepared to justify the special program’s goals should they be challenged.

• Businesses usually justify such special programs through empirical

data or some other factual basis demonstrating their programs address one of the above stated objectives.

Special Program Justification

• Relieve hardship or economic disadvantage;
• Assist disadvantaged persons achieve, or try to

achieve, equal opportunity; or

• Help eliminate discrimination

Special Program Application

• Nature of the sponsoring organization.
• Accountability and monitoring.
• Identification of disadvantaged individuals/groups.
• Benefit of the program.
• Goals, timetables and anticipated results.
• Duration of program.
• Eligibility criteria for disadvantaged individuals/groups.
• Identification of third party interests (such as local native bands).

Lack of Infrastructure

• US collects data on diversity
• National Minority Supplier Development Council, Inc.

(NMSDC)

• NMSDC founded 1968
• Members do $101.1B in business (2009)
• Canada lags
• Canadian Aboriginal and Minority Supplier Council

(CAMSC)

• A decade old
• 39 members (2011)

Why Good Infrastructure is Important

• Data collection can be complex
• What is a “minority”?
• CAMSC has an 8 page questionnaire
• Data collection can lead to liability
• Privacy issues
• CAMSC has a 1.5 page release

Lack of Data Analysis

• Which minorities are important?
• Religion?
• LGBTQ?
• Political belief?
• Family status?
• Marital status?
• Conviction for an unrelated criminal offence?

Data Analysis cont’d

• Are all minorities under-represented everywhere?
• Who is under-represented in law?
• Where is this under-representation?

No Data Tracking

• Unlike the United States, Canada does not know which

historically disadvantaged groups remain disadvantaged, or to what degree.

• Canada also does not know whether disparity with

respect to a specific minority is regional or national.

Recommendations

• Do not track diversity
• If you must, do it anonymously
• Limit tracking to FCP criteria:
• Women
• Aboriginal status
• Visible minorities
• Disability

PERFORMANCE MANAGEMENT IN THE AGE OF HARASSMENT

(Seriously, What’s the Point?)

You are stressing me

• ut! I am

being harassed! Would you just do your #&$%!! job!

Employer Rights

• Require employees to work
• Manage the business
• Comment on performance
• Conduct performance reviews
• Discipline

Employee Rights

• Freedom from harassment/abuse
• Reasonable demands,

communicated clearly

• Assistance/Coaching
• Fair performance reviews
• Accommodation

So Why Manage Performance?

• Assist the Employee
• Build a Case For Cause
• Defend a Decision to

Terminate

What is Required to Prove Cause?

• Test for incompetence
• Will you pay anyway?
• How long will it take?

Better to Cut Your Losses?

• Benefits of an

employment agreement

• Probationary period

is your friend

• Know your goal
• Know your risks
• Decide on a plan
• Know when to cut your losses
• Employment Agreement
• Up to date Policies

What Are the Take Aways

THE HOSTILE WORK ENVIRONMENT

• Why can’t we all just get along?
• Contractual Liability
• Tortious Liability
• Statutory Liability
• Other Liability

• No employer wants to be mean (well, most do not)
• Main reasons for conflict:
• Desire for efficiency
• Human nature

WHY CAN’T WE ALL JUST GET ALONG?

HUMAN NATURE

• Piresferreira v. Ayotte 2010 ONCA 384
• Manager: “critical, demanding, loud and aggressive”
• Employee: “nervous and sensitive, not taking

responsibility for problems but instead blaming others, and not dealing well with criticism”

• Combination: “The two personalities could hardly be

less complementary”

Bottom Line - Causes of Conflict

• Efficiency does not require abuse
• Explore alternate models to motivate employees
• Human nature frequently leads to conflict
• Watch for and manage that conflict

CONTRACTUAL LIABILITY

• Duty of good faith
• Constructive dismissal

Duty of Good Faith - In Termination

• There is a duty of good faith in termination
• During a termination, an employer must:
• Act fairly
• Be forthright
• Breach of duty of good faith in termination will lead to

increased liability (“moral” or “Honda” damages)

Duty of Good Faith - Outside Termination

• No general contractual duty of good faith in the

employment relationship

• Cannot bring an action in contract directly for abusive

behaviour

• BUT, abusive behaviour:
• May form the basis for a constructive dismissal
• May also for basis for moral damages following

constructive dismissal

• Berg v. Cowie (1918) 40 DLR 250 (Sask CA)

Constructive Dismissal

Berg v. Cowie “the servant is also, in my opinion, entitled to decent treatment at the hands of the master”

The Test For Constructive Dismissal

• BC and Alberta:
• Civility, decency, respect and dignity
• BC and Ontario:
• Intolerable work environment
• Really the same test

Permissible Conduct

• Employers may:
• Express frustration with an employee
• Make “very direct” comments about performance
• Require employees to work in a workplace with some

degree of conflict or discord

Mitigation

• Duty to mitigate alleged loss by accepting changed

employment following constructive dismissal.

• No duty to mitigate if an:

“atmosphere of hostility, embarrassment, or humiliation”

Farquhar v. Butler Brothers (1988) BC CA at p. 7

Constructive Dismissal - Bottom Line

• Abusive conduct may lead to:
• Successful claim of constructive dismissal
• Negation of duty to mitigate
• Additional moral damages
• Courts often place as much or more emphasis on

employer’s response to abusive conduct than the conduct itself

Other Contractual Risks

• Aggravated damages
• Compensation for intangible injuries that are

“independently actionable”

• Punitive damages
• Punitive award for conduct that is “malicious, oppressive

and high-handed" or that "offends the court's sense of decency"

• Special Costs
• For bad faith conduct during litigation

Limits of Contractual Liability

• Test for abusive conduct is objective
• Employee’s claim will fail if the objective reasonable

person would not find environment intolerable

• Rare a single action of abuse will amount to

constructive dismissal or contractual liability

• Employer has a right to manage business
• Legitimate performance review and workplace

management okay

TORTIOUS LIABILITY

• Intentional infliction of mental distress
• Negligent infliction of mental distress
• Bad faith discharge
• Defamation
• Deceit
• Invasion of privacy

Intentional Infliction of Mental Distress

• Wilkinson v. Downton [1897] 2 QB 57

Test

• The conduct must:
• be flagrant and extreme;
• be plainly calculated to produce some effect of the

kind which was produced; and

• produce actual harm (a visible and provable illness).

Flagrant and Extreme

• An objective test
• Kalaman v. Singer Valve 1997 BCSC:
• Criticism of employee failing to complete work
• Was “unreasonable and insensitive”
• Was not “flagrant and extreme”

Plainly Calculated

• Conduct must be intentional
• Conduct must be calculated to produce harm
• Reckless conduct is not sufficient

Negligent Infliction of Mental Distress and Bad Faith Discharge

• These torts do not exist (yet?) in employment law
• Courts have deferred to legislature to impose liability for

bad workplace behaviour

Defamation, Deceit, Invasion of Privacy

• All well-established torts
• Liability will arise if the elements of these torts are made
• ut

Tortious Liability - Bottom Line

• Except for the most egregious, deliberate abusive

conduct, unlikely employer actions will result in tort liability

• There is still a risk of defamation claim, deceit claim,

and invasion of privacy claim

STATUTORY LIABILITY

• Human Rights
• Workers Compensation

Human Rights

• Harassment or bullying on the basis of an enumerated

ground prohibited

• Will lead to:
• Injury to dignity
• Embarrassing public decision
• Make whole wage and expenses remedy

Workers Compensation

• Make harassment and bullying health and safety issues
• Require objectively offensive conduct
• Exclusions for conduct in the course of legitimate

management (e.g. performance reviews, office restructuring, etc.)

Workers Compensation - A Shield as well as a Sword

• Section 257 certificates:
• Precluding litigation through WCA complaint

Workers Compensation - Another Sword Too

• Retaliation liability
• Liability for addressing a health and safety issue

Statutory Liability - Bottom Line

• An employer has a positive obligation to take steps to

ensure their workplace is free of bullying and harassment

• An employer that fails to meet this obligation will face

liability

OTHER LIABILITY

• Mental stress disability leaves
• Lower productivity
• Negative morale
• Unionization

An Example Case

• The Plaintiff:
• 30+ year employee
• Junior level manager
• Loved by former regional manager
• Type A personality
• Micro managed subordinates
• Worked 10 hour days, 6 days a week (in part because of

micro managing)

The “Abuse”

• Gets a new manager
• New manager requests:
• greater autonomy for subordinates; and
• better work life balance
• Plaintiff interprets new manager’s request as lack of

trust and faith

• New manager says if problem not micromanaging could

take lateral move to admin position

The Claim

• All plaintiff hears is “move to another position”
• Alleges constructive dismissal
• Subsequent attempts to have plaintiff return to same

position fall on deaf ears

• Plaintiff becomes severely depressed

The Cost

• Plaintiff claims LTD
• Plaintiff claims constructive dismissal
• Plaintiff claims intentional infliction of mental distress
• Plaintiff’s annual salary: approx $75,000
• Plaintiff’s claim: approx $1.2M

Best Practices - Policy

• The employer policy should:
• Prohibit harassment, discrimination and bullying
• Have an effective dispute resolution mechanism
• Have simple reporting procedures, with at least one

alternate report

• Have a clear investigative process, with timelines,

documents, and steps

• Set out clear remedial sanctions

Best Practices - Training

• Employers should train all employees:
• Refresher training should be included at regular intervals

(at least annually)

• Encourage employees to bring forward complaints
• Ensure employees the harassment policies
• Train on effective investigation and decision making
• Teach quick and appropriate action to manage conflicts
• r address harassment issues.

Best Practices - Resources

• Use specialized resources:
• WorkSafeBC:

http://www2.worksafebc.com/Topics/BullyingAndHarassment/Home.asp

• Counsellors and psychologists
• Workplace investigators
• Counsel

WORKSAFEBC - HARASSMENT UPDATE

• In the past year, almost 100 WCAT decisions

considering “bullying”

• I have not read them all (or even most of them)
• As of 2013 statistics, WSBC not tracking gradual onset

stressor claims separately

My Views

• Based on my brief review of a dozen or so randomly

selected decisions.

• Complaints remain split between traumatic event and

gradual onset stressors.

• Gradual onset stressor much more difficult to establish:

factual basis seldom rises to level of bullying and harassment

• In all cases, a question of fact

THANK YOU!

Richard Press 604.643.6444 Employment & Labour Partner, Davis LLP