Fired because of race? Consider a human rights claim

January 29, 2020 Devry Smith Frank LLP Employee Relations, Employment/Labour Standards, Human Resources, Human Rights, Notice, Damages and Settlements, Payroll, 0

In 2018, a group of eight Caucasian employees of the Spruce Hill Resort and Spa Ltd. (“the Resort”) in British Columbia made a complaint to the British Columbia Human Rights Tribunal (“the Tribunal”), in which they alleged that they had been terminated from their employment because they were not Chinese. The Tribunal found that seven of the employees had been discriminated against on the basis of race and colour, and one employee had been discriminated against on the basis of sex. The Resort was required to pay a total of $113,141.01 as compensation for lost wages and $60,000.00 as compensation for injury to dignity, feelings and self-respect, for a total of $173,141.01.

The group in Eva obo others v. Spruce Hill Resort and another (“Spruce Hill”) made the claim against the Resort and Mr. Kin Wa Chan. Mr. Chan had recently purchased shares of a company that owned a resort, and as a result, took full control of the resort. The group alleged that they had been discriminated on the basis of race, colour, ancestry, and place of origin, contrary to s. 13 of the British Columbia Human Rights Code (“Code”).

Some employees indicated that they were terminated by the Resort, while others chose to resign from their positions because of the discriminatory working environment. All of the employee complainants left their positions within days of each other.

The group alleged that the discrimination occurred over “several months and culminated over several days in August 2016.” One of the employees also alleged that there was one instance of discrimination on the basis of sex by Mr. Chan, contrary to s. 13 of the Code.

(1) Discrimination based on race and colour

With respect to race and colour discrimination, the Tribunal was faced with four main issues: (1) whether Mr. Chan stated that he wanted to replace Caucasian employees with Chinese employees; (2) whether Mr. Chan reduced the hours of Caucasian employees, and instead, provided those hours to Chinese employees; (3) whether some of the employees were fired because they were not Chinese; and (4) whether the employees who resigned did so because of discrimination in the workplace. All four issues were answered in the affirmative by the Tribunal.

The Tribunal assessed the credibility of each employee and Mr. Chan, who testified at the hearing. Employee diary entries were also considered by the Tribunal. The Tribunal found that while each employee was credible, Mr. Chan was “less credible than the complainants.” Since Mr. Chan did not have “a detailed recollection of events” and conversations, the Tribunal accepted the evidence of the complainants over that of Mr. Chan.

The Tribunal found that Mr. Chan had, in fact, stated that he wanted to replace the Caucasian employees with Chinese employees in order to lower labour costs. For example, Mr. Chan was heard:

“… yelling and using words to the effect that “white people” were too slow and Chinese workers were faster and cheaper. On other occasions, [one employee] heard Mr. Chan use words to the effect that Canadians are too slow and cost too much, and that Chinese students work, do not complain, and do not need to be paid overtime.”

Mr. Chan had also acted on those statements by demoting employees, terminating employees, and consistently expressing his desire to replace Caucasian employees with Chinese employees. The latter resulted in several employees resigning from their positions because of the discriminatory work environment.

Despite Mr. Chan’s denials, the Tribunal found that “his stor[ies] d[id] not harmonize with what he actually did, what credible witnesses heard him say, and with the preponderance of the probabilities which a practical and informed person would readily recognize as reasonable in that place and in those conditions.”

It is important to note that, while the Tribunal concluded that “the Complainants are not members of a group that has been historically discriminated against [,]” the fact of the matter was that they were “subjected to a poisoned work environment due to racism.” The Tribunal considered the 2017 Supreme Court of Canada decision in British Columbia Human Rights Tribunal v. Schrenk in which the court concluded that “the structure of the Code supports an approach that views employment as a context requiring remedy against the exploitation of vulnerability.” As such, to determine the employees’ compensation for injury to dignity, the Tribunal considered that employees are “particularly vulnerable” in contrast to their employers, especially since many employees have few other employment alternatives.

(2) Discrimination on the basis of sex

One of the employees, Ms. Eva, indicated that she was sexually harassed by Mr. Chan during a business trip to China. While Mr. Chan did not dispute the facts of what occurred during the trip, he disputed the interpretation of those events.

Instead of booking separate hotel rooms, Mr. Chan had booked one hotel room, which had a bathroom with a glass divide, for him and Ms. Eva. Once Ms. Eva realized this, conflict ensued in the hotel room. Ms. Eva felt that Mr. Chan booked one room because he wanted “sexual favours” from Ms. Eva, while Mr. Chan claimed that he wanted to save money by booking one room.

The Tribunal found that Mr. Chan’s actions amounted to sexual harassment, in contravention of the Code. The Tribunal found that Mr. Chan’s evidence was not credible. Rather, it was “more probable than not than Mr. Chan wanted to share a hotel room with Ms. Eva for sexual purposes.”

What does this mean for employees and employers?

The Tribunal took into account the vulnerability of employees in finding that the employees were discriminated based on race and colour. This decision confirms that an employer’s expressed preference to hire employees of a particular group can constitute discrimination against Caucasians, even though this group has not been historically discriminated against. Although Spruce Hill is a British Columbia decision, the decision and reasoning are consistent with the law in Ontario.

By Marty Rabinovitch and Linda Noorafkan

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Devry Smith Frank LLP

Employment and labour lawyers at Devry Smith Frank LLP

Devry Smith Frank LLP (DSF) is the largest full service law firm in Toronto outside of the downtown core. They offer a broad range of legal services to individual, business and corporate clients in most areas of corporate and personal law. Their firm’s employment law group covers a broad spectrum of HR law, including employment and labour law, occupational health & safety, human rights, workers’ compensation and much more.Lawyers at Devry Smith Frank LLP lead by Marty Rabinovitch B.A.H., LL.B. will be covering issues surrounding employment and labour law and human rights on First Reference Talks. They also provide training, seminars and conferences on the above topics. Read more .