Sexual Harassment Claims and new Workers’ Compensation Law

Written on behalf of Peter McSherry

Sexual Harassment & Workers’ Compensation

The pending amendments to Ontario’s Workers’ Compensation Act, to be effective January 1, 2018 basically lowers the threshold for a claim based on emotional trauma where the worker has suffered “chronic or traumatic mental stress” arising out of and in the course of employment.

This new law may have a dramatic effect on sexual harassment claims.

As discussed previously in Ontario a victim of sexual harassment may either (1) present a claim under the Human Rights Code or (2) sue civilly by means of the traditional civil cases based on wrongdoing, also known as a “tort” claim.[1]

Impact on Civil Claims

It is clear that the latter action will not be permitted in the case of a workplace sexual harassment where the victim is covered by the workers compensation as the great majority of Ontario workers are.  Ontario’s statute defines “accident” to include willful and intentional conduct.

There are some advantages to a workers compensation claim. The successful complainant will recover 75% of pre-event income which is tax free to the recipient. There are, however, no damages for emotional trauma or punitive damages. Also, unlike a human rights remedy, there is no mandatory reinstatement remedy following the victim’s apparent recovery. There is an additional sum allowed of one year’s pay when the employer refuses to reinstate.

Ironically the argument of a workers compensation was not raised in the City of Calgary[2] sexual harassment case. All workers in Alberta are covered by workers’ compensation. It very likely would have followed that this award of $800,000 should have been zero.

The availability of a workers compensation recovery may even limit recovery of human rights damages under the Human Rights Code, as unimaginable as that may seem at first blush.

Generally, human rights legislation is considered quasi-constitutional and as such, supersedes any conflicting statute, unless specifically stated to the contrary in the human rights enabling legislation. This principle was stated quite clearly in 2008 by the Nova Scotia Court of Appeal in Halifax (Regional Municipality) v. Nova Scotia (Human Rights Commission) and remains a cornerstone of human rights law.

  Apart from the quasi-constitutional status argument, the human rights process does deal with broader issues from a public interest perspective and includes other forms of non-monetary relief, including reinstatement, which is not available by a workers’ compensation claim.

Two consequences may follow. The first is that this decision may have no impact on human rights claims. The second is that it may, at least, effect a claim for compensatory damages and/or lost income claims based on a workplace human rights violation.

The Supreme Court of Canada in its 1996 decision in Béliveau St-Jacques v. Fédération des employées et employés de services publics inc., considered a similar conflict between the Quebec Charter of Rights and Freedoms and the workers’ compensation regime of Quebec.

The employee had received compensation under the Quebec workers compensation legislation with the Commission de la santé et de la sécurité du travail (“CSST”) for “an employment injury” which was based on sexual harassment.

She also had commenced a civil action against the alleged harassor and her employer based on improper sexual advances based on a remedy allowed to her under the Quebec Charter.

The employer argued that due to waiver of civil remedy under this legislation that she was barred from civil action.

The Quebec Charter specifically allowed for an award of exemplary damages. It was noted by the court that the Charter maintained a special status of a quasi-constitutional substance:

Gonthier J., writing for the majority of the Supreme Court of Canada, however, determined that there was no remedy available under the Charter.

The majority opinion did also refer to the right of the individual to file a grievance under a collective agreement and offered these words, obiter[3], but nonetheless instructive of a view of the remedy of reinstatement and public interest remedies by analogy under the Human Rights Code:

I shall therefore refrain from determining whether a grievance could have been filed in the instant case.  If that had been the case, however, it is understood that the arbitrator could not have awarded damages for the prejudice suffered as a result of the employment injury.  The exclusion of a civil liability action also applies to the grievance arbitrator.  This being said, it is not inconceivable that an arbitrator dealing with such a grievance in these circumstances could have ordered other remedial measures, such as reinstatement or reassignment, if the collective agreement so allowed.

The above words suggest that a public interest remedy and/or reinstatement may survive the claim for workers’ compensation benefits.

A Tangled Web

If you are seeking advice on an issue of sexual harassment, be sure to take advice before you act. Contact the offices of Guelph employment lawyer Peter McSherry. We can guide  you through the issues and defend your position. Contact us online or by phone at 519-821-5465 to schedule a consultation.

[1] Master Laycock of the Court of Queen’s Bench in Alberta in the March 2013 decision of Ashraf v SNC Lavalin ATP Inc. This decision was upheld by Mr. Justice Mahoney and again by the Alberta Court of Appeal. The employee was allowed to assert that the abusive conduct was constructive dismissal.

[2] City of Calgary v CUPE

[3] That is, not a concrete statement of law binding on lower courts.