Employee Sues for Hiring of Past Sexual Abuser

Written on behalf of Peter McSherry

Employee Fired Due to Hiring of Past Sexual Abuser

The recent decision of the Ontario Superior Court of Colistro vs Tbaytel and the City of Thunder Bay provides an interesting review of the issues of constructive dismissal, sexual harassment and damages for the breach of the obligation of good faith, albeit in a very unusual fact situation.

What Happened Here

The plaintiff had been employed by the City and its related party for approximately 19 years, most recently as an administrative assistant.

Controversy arose in January of 2007 when the company announced that a former employee of the City, had been rehired to a senior position. This person, however, had been previously terminated by the same employer in 1996, in part, due to allegations then made by the plaintiff that the very same person had sexually harassed the plaintiff.

The trial judge agreed that this fact had been established. The Court found that although he had  officially fired without cause, the reasons which motivated the termination included his sexual abuse of the plaintiff, misappropriation of funds, and managerial incompetence. The judge also concluded that the relevant documents relating to his termination were readily accessible to the employer.

The employer had been made aware of the events which led to the prior termination by the plaintiff, soon after it had announced his re-hiring and prior to the commencement of his actual employment, as the Court found.

Upon being advised of this rehiring, the plaintiff left the work premises, never to return again to active employment in view of this event. She did return, however, to the work premises and provided a detailed account of the sexually abusive comments which had been had made to her in 1996 which had then led to the earlier termination.

The employer testified at trial that it had no internal records of the events which had led to this termination. It also raised as a defence that it had offered the plaintiff two alternative positions in a different location, one of which involved significant contact with this person and the second of which offered minimal contact between the two. The plaintiff refused both offers. Both defences failed.

Court Sees The New Hiring as Offside

The Court concluded that the decision to proceed with the re-hiring decision in this context was “flagrant and outrageous”. It knew, given its awareness of the emotional reaction of the plaintiff to this decision, that such conduct would likely precipitate the plaintiff’s PTSD and depression. Indeed the evidence was that such emotional turmoil continued from early 2007 to the date of trial in 2017.

The Court did find that the employer’s decision to continue with the rehiring, in law, amount to conduct which brought about the plaintiff’s termination, that is, was a constructive termination. This created a “poisoned work environment” which made continued employment “intolerable”. The judge found that is so doing, the employer “re-victimized the plaintiff” and minimized the past transgressions of the offender.

Damages

The notice period was set at 12 months from which was deducted disability payments the plaintiff had received in the interim period. Occasionally arguments can be raised that such payments ought not to be deducted when the employee indirectly or directly paid the insurance premiums.

For example, certain past cases have allowed “double dipping” where the employee had argued that the payment of insurance premiums when made by the employer were in substance part of the wage compensation. (Such was the case in the Ontario Court of Appeal decision in McNamara v Alexander Industries) No such argument was made in this case. Similarly an argument could have been made that the plaintiff was entitled to the minimum statutory payments of 28 weeks’ pay without offset. This submission was also not made.

The resultant award for lost income for the 12 month period was modest, being set at roughly $14,000.

An award was made, however, for damages for breach of the obligation of fair dealing and good faith in the sum of $100,000.

Employer’s Obligation to Provide Safe Working Environment

The case certainly presents an unusual fact situation. It does highlight, nonetheless, the obligation upon the employer to assure a safe work environment. No doubt in this instance, the court was not impressed with the employer’s reluctance to change its course, even when it had become aware of the plaintiff’s legitimate concerns.

It also illustrates the need for the employer to act humanely and fairly at the time of dismissal. Had it hired an external investigator to examine the issues relevant to the re-hiring decision and then proceeded to maintain his hiring, it at least could have argued it acted in good faith and avoided the additional damage award.

Does This Litigation Make Sense?

The trial of this action took 13 days of court time. It may well be questionable as whether the sum recovered could justify such expenses and more importantly, the risk of paying the employer’s costs of the trial. To be entitled to recover “partial indemnity” costs, the plaintiff must not only succeed in the claim but also obtain a judgment which exceeds any offer made by the company. At present such offers have not been disclosed. Had the employer offered an amount greater than the sum received, the plaintiff would not only not receive costs but also be required to pay the employer’s costs. This becomes a high scale poker game for a 13 day trial. Plaintiff’s counsel must always be careful when proceeding to trial in such a case.

Take Advice Before You Act

The employer’s conduct in this case was abusive and outrageous. Not every fact situation will meet this standard. The employee needs to act prudently before putting secure employment in jeopardy in exchange for a lawsuit.

Should you find yourself in such a difficult position, get advice before you act. Contact the offices of Guelph employment lawyer Peter McSherry. We can help you determine whether you may have a claim due to a poisoned work environment or a constructive dismissal claim. Contact us online or by phone at 519-821-5465 to schedule a consultation.