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Retiring employee when he reaches 65 on grounds of poor performance


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Image: Ambro |

The New Brunswick Court of Queen’s Bench recently challenged the Human Rights Commission’s decision to dismiss an employee’s discrimination complaint based on age as without merit. The employer denies discriminating against the employee on the basis of his age, and maintains that the employee was terminated for poor performance.

Essentially, an employee of 34 years reached the age of 65, and the employer terminated him and claimed the employee failed to meet the performance standard expected for his position. This argument was made in accordance with a clause in the collective agreement that allowed such a termination for an employee who was past 65 years old.

Moreover, a section in the collective agreement allowed the employer to terminate the employee who attained normal retirement age based on poor performance as follows:

11.04 The employer may discharge [an employee] … (4) if an employee who has attained normal retirement age, fails to meet the performance standards expected for his position, such determination and assessment to be at the discretion of the employer, then the employer has the right to release that employee from employment. In these circumstances, severance pay will be paid in accordance with the terms of Section 12.04, and as such the termination will not be for cause.

The problem was that the employee had no performance issues on his employment record, other than a few minor warnings that could not in any way amount to cause for termination. And no problems happened at all in the time before the employee was terminated.

The Human Rights Commission dismissed the employee’s discrimination complaint on the basis that the investigator found there were ongoing performance issues for years, the employee had a poor attitude, and the employee was warned that he could be terminated if it recurred through emails, warnings and meetings. Also, the collective agreement allowed such a termination.

On appeal, the employee argued that nothing happened before he was terminated— except he turned 65 years old. Moreover, he had received only a few warnings, none of which could constitute cause for termination.

Hence, this clause was used improperly to clearly discriminate against the employee to terminate him upon reaching the age of 65.

In its brief decision, the Court concluded that the Commission made an unreasonable decision to dismiss the employee’s complaint as being without merit. The clause in the collective agreement was prima facie discriminatory on the ground of age, and the possibility of a bona fide defence was not even investigated.

The Court ordered the commission to reinvestigate (with a different investigator) the following:

  • If the clause in the collective agreement was discriminatory in its treatment of people who were 65 years of age compared to younger employees
  • If reliance on that provision was discriminatory
  • If age was a factor in the decision to terminate his employment
  • If any bona fide defence applied, especially of a Bona Fide Retirement Plan

The Court stated that once the commission’s report was ready, it had to reconsider the employee’s complaint in its full context.

The employer clearly attempted to add and rely upon a clause in the collective agreement that would effectively circumvent the entire human rights analysis required to occur when a person makes a claim of discrimination on the ground of age.

The message is clear for employers: this is not acceptable, as it is at first appearance discriminatory.

As a result, the matter was sent back to the commission to investigate certain stipulated matters.

We shall see in the near future what the result is following a proper analysis of the case, and keep you posted…

Christina Catenacci
First Reference Human Resources and Compliance Editor

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Christina Catenacci

Christina Catenacci, BA, LLB, LLM, was called to the Ontario Bar in 2002 and has since been a member of the Ontario Bar Association. Christina worked as an editor with First Reference between February 2005 and August 2015, working on publications including The Human Resources Advisor (Ontario, Western and Atlantic editions), HRinfodesk discussing topics in Labour and Employment Law. Christina has decided to pursue a PhD at the University of Western Ontario beginning in the fall of 2015. Read more
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