Saturday, September 4, 2010

So you've been canned for discriminatory what?

The simple answer is: Get a lawyer. If your employer is asking you to sign a release, you want legal advice before you sign anything. If your employer *isn't* asking you to sign anything, it's likely because you're not getting any more than your statutory minimums, and on most not-for-cause terminations, statutory minimums aren't enough, even where there isn't a breach of the Human Rights Code. (If you have been fired "for cause" and paid nothing...the threshold for just cause is high, and you should get legal advice on that point anyways.)

But the point of this post is to discuss a question that I've been pondering for a while now: Now that you can seek a remedy for a Code breach in Court...should you?


For many years, litigants were trying to get the Courts to provide a remedy for Code breaches, or recognize a common law tort of discrimination, etc.

In the Bhadauria case in 1981, the Supreme Court of Canada resolved this question with a firm "No". The Code provided a comprehensive system for remedying Code breaches, leaving no jurisdiction for the Courts.

That wasn't the end of it, of course. For many years, the Human Rights system in Ontario was notoriously broken, and so other avenues were sought. In fact, labour arbitrators were found to have jurisdiction to apply the Code, as were other administrative tribunal adjudicators. However, the Courts always held firmly that the Courts should not be burdened with Human Rights matters.

Every so often, somebody would come back to argue that the Courts should recognize a common law tort, or try to characterize a human rights breach differently so as to get the Courts to award damages for it. Most recently - as in, June 27th, 2010, in Honda v. Keays, the Supreme Court again faced an argument in favour of a common law tort of discrimination, and upheld Bhadauria. The more interesting challenge in that case is the fight for punitive damages. way of legal background, let me explain that breach of contract cases (such as wrongful dismissal cases) were not historically considered appropriate for awards of aggravated or punitive damages. A couple of niche exceptions grew around this doctrine, and in a wrongful dismissal case you would need to show a "separate actionable wrong" in order to be able to claim on that basis. (See Vorvis.) Basically, unless you could show that the employer had done something else beyond the wrongful dismissal itself, you couldn't get aggravated or punitive damages.

However, this wasn't too big of a problem for plaintiffs for many years, as the Courts as a matter of course would award "Wallace damages", being increases to damage awards based on employer breaches of its duty of good faith and fair dealing.

Eventually, in 2006, in the Fidler v. Sun Life case, the Supreme Court removed the "separate actionable wrong" analysis from aggravated damages. In Honda, they essentially scrapped Wallace damages, saying that if you can't prove aggravated damages, you can't get anything. And the test for punitive damages is very high in any event.

For punitive damages, however, the lower Courts in Honda (including the Ontario Court of Appeal) found that breaches of the Human Rights Code, even though they couldn't ground a civil Court claim, nonetheless constituted a separate actionable wrong. They found such a breach and awarded hefty punitive damages. (The doctrine is flexible enough that this actually made sense.) The Supreme Court, however, suggested in obiter that it doubted the correctness of this, that in fact Bhadauria was a complete bar to an award of damages by the Courts for a breach of the Code. However, the Supreme Court found that Honda had actually behaved reasonably towards the employee, and that punitive damages simply weren't warranted.

What's really interesting, though, is that amendments to the Code became effective 4 days later, reversing Bhadauria in Ontario. Now, on the express terms of the statute, the Courts have jurisdiction to hear Human Rights complaints which are ancillary to other claims. It seems built for wrongful dismissal cases.


So a wrongfully dismissed employee with a Code dimension to the claim has at least two options, the two most obvious being a civil suit seeking damages reflecting reasonable notice plus human rights damages (including "injury to feelings, dignity, and self-respect"), or going to the Human Rights Tribunal seeking full compensation for the loss of employment, including lost wages.

At the end of the day, from a principled perspective, the monetary values should end up being the same, if successful. While lost wages for a Code breach should have the potential to run much higher than reasonable notice, one would expect the Court to apply the same analysis to it as the Tribunal. The Court power is still too new to know for certain. On the one hand, awarding speculative loss-of-income is nothing new to the Courts, such as in a personal injury context; whereas administrative tribunals tend to cut off damages as at the date of the hearing (which is awfully arbitrary), we might expect to see Courts anticipating further damages past the trial date, in the right factual circumstance. (In any event, it'll take longer to get to Court.) On the other hand, Courts tend to be relatively constrained when awarding damages. If a plaintiff is showing up in Court three years after being fired, still unemployed, the Court is likely to take a pretty long hard look at mitigation efforts, even though mitigation is traditionally a relatively low threshold for a plaintiff to meet.

There are other differences as well.

Process and Costs

First of all, the Human Rights Tribunal process is easier, more user-friendly, cheaper, and there are free legal resources (namely, the Human Rights Legal Support Centre) available to access it. There is no jurisdiction at the HRTO to award a successful party a contribution to costs (unlike the Courts), but a smart Applicant shouldn't incur much in the way of costs to get there.

That being said, I don't have any data regarding the HRLSC's effectiveness. The Centre is only a little over two years old, and I did see some figures regarding volume of work, etc, after the first year - the numbers suggested a particularly overwhelming volume of service requests in South-Western Ontario - but I don't know how they're faring today. I've sent a few prospective clients their way. I haven't heard any complaints yet, for what that's worth.

And while you've seen me go on about self-represented litigants before, the HRTO process is far easier to navigate than the Courts. If the HRLSC weren't there, I'd instead have told some of those above-noted prospective clients that they might consider handling the matters themselves.

Finally, the HRTO is faster. Their target time to deal with a matter is under 1 year. In my experience, the administrative side of the Tribunal is pretty close to being on top of that. They'll schedule hearings in a pretty timely manner. However, I have found that the adjudicative side of the Tribunal can be slow. The consequence of that is that the expediency of the process can be derailed by Requests for Orders during Proceedings, seeking anything from disclosure of documents to addition or removal of Respondents (or, in one case I worked on, addition of Applicants) or the raising of other jurisdictional or procedural issues...the matter can't proceed substantively until the RFOP is dealt with, and the RFOP can take quite a few months.

(Essentially, you make a Request and the other side gets to respond. After this, the Tribunal has to decide how to handle the Request. On some occasions, it can look at the Request and Response and deal with it summarily. Even in this kind of summary disposal of the request, I've seen it take over three and a half months from the filing of the Request to the release of a decision. In other cases, the Tribunal decides it needs more elaborate written submissions, or needs an in-person hearing. Occasionally, the more elaborate written submissions, once received, make it clear that an in-person hearing of the issue is necessary. A back-and-forth between the adjudicative branch of the Tribunal and the parties can easily lengthen the process.)

Even then, though, it looks like a longer Tribunal process is on par with a shorter Court process.

Differences in Jurisdiction

Both the Tribunal and the Courts can remedy a violation of the Code. However, they do have differences in what they can do. First of all, the Courts can only provide a remedy if the claim based on a Code breach is ancillary to another civil claim. Not too difficult - when dealing with wrongful dismissal, it will be a rare case where you can't make out a civil claim, but can make out a Code breach.

The converse is also true. And this is a bigger issue: The Tribunal can not order a remedy unless a Code breach is established, even if there are other clear civil entitlements.

Suppose I'm wrongfully dismissed, and my reasonable notice period would be 6 months, but I'm unemployed for 12 months. If I go to the Tribunal arguing that my termination was in violation of the Code, and am unsuccessful on that issue, then the Tribunal will give me nothing, even though it is clear that I'm entitled to 6 months' wages.

Being at the Tribunal changes the whole nature of the issues in contention: At Court, discrimination only affects quantum of damages. If a Plaintiff loses on that, he gets less. At the Tribunal, the question of discrimination/harassment is a jurisdictional question. If an Applicant loses on that, she gets nothing.

Other differences include that the Tribunal cannot award punitive damages, and the Courts can...though usually won't.

Unlike the Court, the Tribunal cannot remedy other peripheral non-Code breaches. If an employer didn't pay overtime, as a matter of practice, but should have, then usually you will not be able to tack on an overtime pay claim to an HRTO Application; you'd have to make a separate complaint to the Ministry of Labour. (NB: Do *not* claim termination pay at the Ministry of Labour without first getting legal advice. If you do so, you will lose your entitlement to sue in Court for wrongful dismissal. It may leave open the possibility of an HRTO Application...but you have to be careful on that. Get legal advice first.)

The Tribunal has an express power to order public interest remedies - ordering future compliance with the Code. This is actually a potent threat in some circumstances which encourages settlement; no business wants the Tribunal looking over its shoulder on a moving-forward basis. The Courts do not have this jurisdiction (though in some narrow circumstances they might be able to draw similar powers from their equitable jurisdiction...never mind - legal abstraction).

Now this is important: You can not do both. If you make a claim based on a Code breach at Court, you cannot subsequently make an Application to the HRTO based on the same allegations. The converse is also true. It's one or the other.

...well, sort of. It is possible to have your cake and eat it too, but extremely tricky, and you wouldn't want to do it without a skilled employment lawyer at the helm.

Essentially, if you can bifurcate the issues in the dispute between human rights-related and non-human rights-related, it's possible to claim relief for the Code breaches at the HRTO, and seek relief for other civil wrongs at Court. So I could sue for wrongful dismissal without raising the allegations of Code breaches, and go on to make the Code-based allegations at the Tribunal.

There are a few difficulties with this:

(1) If I'm suing, I want to throw everything including the kitchen sink at my employer. To not raise the Code breaches and accuse my employer of misconduct takes restraint...and for good reason: If the allegations are well-founded, it's good ammunition, and makes the Court less sympathetic to the employer.

(2) If the employer has breached its duty of good faith and fair dealing in other non-Code-related ways, for which I suffered mental health type injuries, I can't really claim for those in Court under this circumstance. Trouble is that, if I frame it to avoid depriving either body of jurisdiction, it will create a causation problem: I'm telling the Tribunal that my injuries are the consequence of the human rights abuses, and I'm telling the Court that my injuries are the consequences of non-Code-based matters. So I can't claim for aggravated damages on that basis at Court, so if I don't prove the Code breaches...well, I lose out. (Also, there's the possibility of a bold employer going to the Tribunal saying "The injuries weren't the consequence of Code breaches; they were the consequence of this myriad other ways in which we treated the employee unfairly.")

(3) The natural sequence would be to go first at the HRTO, and second at Court. Under most circumstances, an HRTO win in this scenario would make most of the Court issues moot. By contrast, a Court win likely wouldn't have the same effect of making the Human Rights Application moot. However, the Courts don't really have a deferral process, and after a certain degree of delay litigants have to start jumping through hoops to start justifying why the litigation isn't moving forward. By contrast, the Tribunal does tend to defer where necessary to avoid inconsistent adjudicated decisions. There's a good argument to be made that, if the pleadings have been carefully drafted, deferral would be inappropriate...but there's also a good chance that the argument would have to be made, which brings us to the next point...

(4) This approach is just asking for motions and Requests for Orders seeking dismissal or deferral of one or the other proceeding. This compromises the expediency advantage of going to the Tribunal...and given that I'd be loathe to advise a client to use two separate lawyers for the separate proceedings, and the HRLSC would not help with a civil wrongful dismissal action, it undermines the cost advantage (and actually backfires in that regard).


Going back to the original question: Now that you can seek a human rights remedy at Court, should you? The answer is that it depends. Weaker human rights complaints should definitely be built into a civil claim: You don't want to risk your whole civil remedy by going to the Tribunal for a tenuous discrimination argument. (Whether that will colour how the Courts deal with it, that they end up seeing the weaker discrimination arguments, should be interesting to watch.)

But where there's a stronger discrimination argument, and/or a relatively limited standalone civil remedy, the HRTO might be the way to go. It's a tricky and risky question to be asked on a case-by-case basis.


This Blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.

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