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Notable cases of 2019

2019 employment law

As we shut the door on 2019 and begin 2020, we at SpringLaw thought this was a good time to look back on some of the biggest 2019 employment law cases in Ontario! Here is our list of the top 5 cases of 2019 and their key take-aways for employers and employees alike.

Colistro v. Tbaytel, 2019 ONCA 197

The facts in this case are fairly similar to other harassment cases we see nowadays, but what makes this case truly unique is the devastating cost consequences for the plaintiff employee. 

Ms. Colistro had been employed at Tbaytel for over 22 years when she was informed that her former supervisor, Mr. Steve Benoit, would be returning to the company. Mr. Benoit was terminated in 1996 because Ms. Colistro and a number of other employees accused him of sexual harassment. When Ms. Colistro expressed her concerns about Mr. Benoit her employer informed her that they could move her to a different location, a remedy that proved unsatisfactory for Ms. Colistro. The news of Mr. Benoit’s return caused Ms. Colistro a great deal of stress and ultimately led to her departure. Ms. Colistro sued Tbaytel for constructive dismissal.

The trial judge provided Ms. Colistro with 12 months in wrongful dismissal damages, which amounted to $14,082.00, once salary continuation and LTD were accounted for, and $100,000.00 in Honda damages for the bad faith manner of dismissal. 

The Court of Appeal dismissed both the appeal and cross-appeal and did not find in favour of Ms. Colistro for her intentional infliction of mental distress claim. The court concluded that Tbaytel could not have known that their actions would cause serious psychological injury. While her constructive dismissal claim was successful, Ms. Colistro was left with a massive costs award ($200,000.00) and was required to pay the costs of her lawyer because she failed to accept a settlement offer from Tbaytel that exceeded her trial award. This case is a classic example of how failing to engage in measured negotiation can lead to awful consequences for a plaintiff – even when they have a strong case!

Merrifield v. Canada (Attorney General), 2019 ONCA 205

Merrifield is another significant case because it is the first Canadian appellate court decision that has confirmed that a separate tort of harassment does not exist.

Mr. Merrifield, an RCMP officer, alleged that his career and reputation were damaged by his superiors after they discovered that he sought the Conservative party nomination in his riding. After learning of his participation in this nomination, the RCMP advanced an investigation into Mr. Merrifield. Mr. Merrifield claims that he was subjected to harassment and career-ending character assassination which caused him to experience extreme emotional distress. Mr. Merrifield sued the RCMP for committing the common law tort of harassment. 

The Ontario Court of Appeal determined that the tort of harassment does not exist and that plaintiffs experiencing harassment should seek remedies under the tort of intentional infliction of mental distress (IIMD). The test for IIMD is: 

  1. Flagrant and outrageous conduct;
  2. Calculated to harm the plaintiff; and
  3. Caused the plaintiff to suffer from extreme and severe emotional distress. 

Employers should keep in mind that while the tort of harassment does not exist they are still required to provide their employees with a harassment-free workplace as employees still have the option to pursue an IIMD claim if they are experiencing severe mistreatment at work. 

3. Heller v. Uber Technologies Inc. 2019 ONCA 1

The Supreme Court of Canada’s decision in this case will have serious implications for employers who wish to include mandatory arbitration clauses into their contracts. In fact, the decision in this case has the potential to create changes in other types of contracts where there are huge power imbalances between the contracting parties (think: consumer contracts). 

Heller is a class action case initiated by David Heller, an UberEats delivery driver who argued that he and his fellow workers are employees and thus entitled to the basic benefits provided under the Employment Standards Act. Uber’s response was to stay Mr. Heller’s claim and insist that the only appropriate venue for this dispute was through arbitration, a requirement under the service agreement that drivers must sign before working on the Uber platform. This service agreement includes a clause that requires employees to go through a mandatory arbitration process in Amsterdam in order to settle their disputes with the company. While the Superior Court ruled that the arbitration clause was valid, the Ontario Court of Appeal overturned the decision of the motion judge and ruled that the clause was “unconscionable at common law” and thus invalid. Uber appealed the Court of Appeal’s decision to the Supreme Court of Canada. We await that decision. 

Up until now, Canadian courts have insisted that contracts that are entered into freely by both parties are enforceable under the law, but the SCC decision in Heller may add some exceptions to this longstanding principle. 

4. Dawe v. The Equitable Life Insurance Company of Canada, 2019 ONCA 512

The decision in Dawe is significant because it reaffirms a notice period cap of 24 months, even where employees are very senior, near retirement and have long service to a company. 

Mr. Dawe was a 37-year employee in a senior management role at the time that he was terminated without cause. Mr. Dawe sued for wrongful dismissal and the motion judge ruled that he was entitled to 30 months’ notice, in addition to bonus payments throughout the notice period. The motion’s judge reasoned that the employer’s decision to end Mr. Dawe’s employment at the age of 62 was “tantamount to forced retirement” and thus 30 months was appropriate in light of the exceptional circumstances. Equitable Life appealed the ruling.

On appeal, the Court of Appeal reduced the notice period to 24 months because they did not agree that the circumstances were exceptional enough to warrant an award above 24 months. The Court relied on another case, Lowndes v. Summit Ford Sales Ltd., to show that the 24 month notice period already accounts for factors such as the employee’s length of service and age at the time of termination when awarding a 24 month notice period.

Determining the factors necessary for an award higher than 24 months is difficult and will depend on the facts of the case, but the decision in Dawe shows that simply being an older adult in a senior role with a long service does not cut it.

5. English v. Manulife Financial Corporation, 2019 ONCA 612

Where once it was thought that employers could simply accept an employee’s notice of resignation, English shows us that employers should make inquiries if they want to avoid a potentially complicated situation down the line.

In English v. Manulife Financial Corporation, Elisabeth English, a 66-year-old employee, provided her employer, Manulife Financial, with her resignation after she became aware of Manulife’s intention to change the office computer system. Manulife accepted her offer but informed her that she could rescind or reconsider her resignation. When she heard that the company was going to indefinitely suspend the conversion to the new computer system, she attempted to rescind her resignation. Manulife chose, instead, to accept her resignation. 

While the Superior Court found in favour of Manulife, on the grounds that English’s notice of retirement was clear and unequivocal, the Court of Appeal disagreed with the lower court’s finding, deciding instead that English’s retirement letter was not clear and unequivocal; therefore, she was entitled to withdraw it. The Court of Appeal reasoned that at the time Ms. English informed Manulife of her intention to resign, she also told them she was unsure whether she wanted to resign. Her employer responded by saying that she could change her mind at a later date.

When Ms. English changed her mind about her resignation, she believed, based on her supervisor’s assurances, that she could easily rescind her resignation. Manulife’s decision to take that option away from her was the nail in the proverbial coffin of their case. It is very possible that the case would have gone in a different direction if the supervisor simply made inquiries into her decision, reminded her that her decision was final and accepted her resignation in the moment. Employers should consider instituting a simplified “resignation acceptance” procedure so that supervisors don’t make one-to-one promises that may make them vulnerable to these kinds of challenges from employees.

The new year is bound to bring with it even more interesting decisions and we look forward to sharing the lessons from these cases with you here! Wishing you all a prosperous 2020!

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Lisa Stam, Spring Law

Founder of Spring Law, Employment and Labour Lawyer at Spring Law
Lisa Stam is founder of Spring Law, a virtual law firm advising exclusively on workplace legal issues for employers and executives. She practices all aspects of employment, labour, privacy, and human rights law, with a particular interest in legal issues arising from technology in the workplace. Lisa’s practice includes a wide range of entrepreneurs in the tech space, as well as global companies with smaller operations in Canada. In addition to the day to day workplace issues from hiring to firing, Lisa frequently blogs and speaks on both the impact, risks and opportunities of social media and technology issues in (and out of) the workplace, as well as the novel ways in which changing expectations of privacy continues to evolve employment law. Read more here.
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