Author: Editorial Team

Sexual misconduct in the workplace is never okay. Except, of course, when it is.

Sounds preposterous, no?

We have known for years that sexual misconduct in the workplace is not okay. We’ve attended trainings, perhaps as lawyers even written those same trainings, and are familiar with the ongoing campaign over the last decade or so to educate the broader public on the dangers of workplace sexual harassment. These were driven, in no small part, by the Government of Ontario’s groundbreaking changes to the Occupational Health and Safety Act to introduce duties for employers and workers to address sexual harassment in the workplace.

So why have we not been able to come to a unified conclusion that such conduct is completely and totally unacceptable? Why do we have a bifurcated standard between the types of workplaces and their governing law/regulations – where sexual misconduct will always be grounds for a for-cause dismissal in some workplaces, but not in others? 

A stark divide has arisen over the past two years between our privately-regulated workplaces, and the post-secondary colleges and universities that train so many of those skilled workers. The Government of Ontario has laudably and clearly established in legislation that sexual misconduct is never okay in the latter, and will result in an automatic dismissal for cause with no monies owing to the offender.

The former? Well, that may be a matter for debate. 

Strengthening the Legislation

In December 2022, Bill 26, also known as the Strengthening Post-Secondary Institutions and Students Act, 2022, received royal assent. While the name may be lofty, the Bill itself took a hard line when it comes to sexual misconduct. 

It codified the law stating that “if an employee of an institution (in this case a college, university, or training program) commits an act of sexual misconduct toward a student of an institution, the institution may discharge or discipline the employee for that act, and,

(a)  the discharge or disciplinary measure is deemed to be for just cause for all  purposes;

(b)  the employee is not entitled to notice of termination or termination pay or any other compensation or restitution as a result of the discharge or disciplinary measure…”

There were further requirements as well, namely that such institutions are no longer allowed to enter into any such agreements that prohibit employees from disclosing such past misconduct, and that any clauses already contained within existing agreements are automatically void.

The change was likely precipitated by several newsmaking incidents where it was revealed that post-secondary employees terminated for sexual harassment were able to quickly find re-employment at other unknowing institutions. Their past misconduct was, of course, protected by a non-disclosure agreement as part of their termination settlements. 

Now that a hard line is drawn, it would make sense that the same high standards apply to privately-regulated workplaces as well. The Court of Appeal, however, appears to have other ideas.

Where Render Gets It Wrong

The decision in Render v. ThyssenKrupp, 2022 ONCA 310, was noteworthy when it was first released by the Court of Appeal only a few months prior to the legislative change mentioned above. However, the way that the Court assessed the appellant’s conduct was significantly different, and respectfully, incorrect.

To recap, Render was the operations manager at an elevator business in Mississauga which operated out of a small office of 13 people – 10 men, and 3 women. There was frequent joking banter in the office culture, which may have been deemed inappropriate at times, but it had never raised significant flags in the past. The office did have an Anti-Harassment and Anti-Discrimination policy which indicated a ‘zero tolerance,’ and noted that violators may be subjected to termination of their employment. 

That policy was put to the test during an incident in February, 2014 when, during an exchange with colleagues, the Plaintiff grabbed a female colleague’s buttocks. While he had denied that the grabbing was intended in a sexual nature, he later admitted that he was offering colleagues “10 bucks to shake his hand” – the hand that sexually assaulted a coworker. 

The Plaintiff was terminated for cause roughly one week later, after an internal investigation, and given no severance or termination pay. Yet while the decision was upheld at trial, the Court of Appeal disagreed. It ruled that even though the Plaintiff’s termination for cause was justified at common law, his conduct did not rise to the level that would disentitle him from his minimum entitlements under the Employment Standards Act and its regulations.

Under the regulations of the Act, namely O. Reg. 288/01 section 2(1), which outlines the various circumstances where employees are not entitled to any legally mandated termination or severance pay, the list includes “an employee who has been guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and has not been condoned by the employer.” Courts have since used this benchmark as a higher standard of cause versus what had previously been interpreted as ‘just cause’ for termination at common law. 

The Court reasoned that the trial judge noted that the conduct was not ‘preplanned,’ and was done in the heat of the moment. It added, “although his conduct warranted dismissal for cause, it was not the type of conduct in the circumstances in which it occurred that was intended by the legislature to deprive an employee of his statutory benefits.” In other words, Render’s conduct was not seen as meeting that higher standard.

The Plaintiff was ultimately awarded his minimum 8 weeks’ termination pay and would have been awarded statutory severance pay had the Plaintiff properly pled and led evidence regarding the same. 

The Double-Edged Sword

Although Render should not be interpreted to suggest that sexual misconduct will never be cause for termination in workplaces outside of post-secondary institutions, Render puts employers in a difficult position when assessing their risk as to whether to terminate an employee for cause after sexual misconduct has occurred. 

With respect to the Court, it is perplexing to say the least that they are interpreting legislative intent regarding sexual assault in one way, when the legislature has stated very clearly that such conduct is absolutely never okay in a different workplace. The answer is not simply because positions of authority rank differently in the world of academia. The Plaintiff in Render was a senior-level employee, so that simply does not add up.

This sort of conduct is never okay, period.  It is high time that the legislature step in and amend the Employment Standards Act, 2000 and O. Reg. 288/01 to specifically spell out “sexual misconduct” as a prescribed reason why an individual would not be entitled to termination pay or severance pay.  Put simply, when it comes to sexual misconduct there should not be two different standards of cause terminations applicable to different kinds of workplace.

If you find yourself dealing with an incident of sexual harassment in your workplace, and you’re not sure what to do next, I can help. For employers, the next steps are crucial in determining what discipline or penalties should take place, and how a workplace can prevent it from happening again. Contact my office to schedule a consultation. 

Employers must tread carefully when considering taking deductions from employee wages.

There is a general prohibition under section 13 of the Employment Standards Act, 2000 (Ontario) (the “ESA“) which prevents employers from withholding wages that an employee has earned, making a deduction from an employee’s wages, or causing an employee to return their wages to the employer, subject to a few key exceptions.  

1. Deductions authorized by statute or order.

The ESA permits deductions from employee wages where a statute or court orders such deductions, including, for example, income tax, CPP and EI contributions, and court-ordered garnishments.

2. Deductions with employee written authorization.

The ESA also expressly permits deductions from employee wages where an employee has provided a written authorization for such deductions.  The written authorization must, however, specify the specific amount of money to be withheld or provide a method or formula to calculate the specific amount of money to be deducted.  Blanket authorizations or oral authorizations are not permitted.

Deductions cannot be made, even where a written authorization is provided, for things like faulty work, cash shortages, lost property, or events such as “dine-and-dash” or “gas-and-dash”.

3. Overpayments.

The ESA also permits deductions from employee wages where there has been an overpayment, including, for example, for an administrative error.  Note, however, that overpayments do not include a situation where an employer intentionally pays an employee more than the ESA entitles the employee to.  For example, where an employer provides an employee with public holiday pay or vacation pay when they are not entitled to it under the ESA.  

One such example that frequently arises in workplace disputes is when an employee leaves their employment after having allegedly taken more vacation days than they were entitled or accrued.  

Consider the Ontario Labour Relations Board decision of Carlisle Technology, 2005 CanLII 45821, where an employee took more vacation than she had accrued, despite an employer’s policy that noted that the employee only accrued vacation on a pro-rata basis.  In response, the employer offset the overpayment of vacation from a residual bonus that the employee was entitled to receive in her final payment of wages.  The Ontario Labour Relations Board examined Section 13 of the ESA and considered the narrow exceptions and found that the employer had breached the ESA.  In reaching its conclusions the Board noted, as follows:

The residual bonus payable to Ms. Morgan constitutes wages within the meaning of the Act. In May 2005, Carlisle deducted from those wages the vacation overpayment. Subsection 13(1) prohibits an employer from making a deduction from wages unless authorized under section 13. Ms. Morgan did not authorize the deduction pursuant to subsection 13(3), nor was the deduction made pursuant to a statute or court order, as contemplated by subsection 13(2). In these circumstances, there is no relief available to the company in this proceeding. The plain wording of subsection 13(1) applies.

It might be suggested that the result in this matter is harsh. However, there are a number of things an employer can do to avoid such a consequence. For example, it can make a clear written policy on deductions or off-sets from wages in respect of wage errors or overpayments, including overpayments of vacation taken in advance, and obtain an employee’s written authorization to such a policy. In Ms. Morgan’s case, there would appear to be nothing to have prevented the company from prohibiting her from taking a week of vacation after announcing her resignation. In fact, had she not taken that vacation, there would have been almost no issue of any overpayment. Finally, there is nothing to prevent an employer from pursuing its claims against an employee in the proper legal forum. What employers are not permitted to do under the Act is take unilateral action as paymaster to satisfy those claims.

Takeaways for Employers

Tread cautiously when making any deductions from employee wages – especially if it does not fall into one of the narrow exceptions outlined above. 

If you are an employer that needs advice with respect to a deduction, please reach out to Treiber Law.

 This article should not be relied on as legal advice or legal opinion. 

Sometimes our media is absolutely terrible about reporting about changes to employment standards legislation.

Take, for example, the headlines in 2021 and 2022 in response to the Ontario government’s amendments to the Employment Standards Act, 2000 (the “ESA“) which required, effective June 2022, Ontario employers with 25 or more employees to introduce a workplace disconnection policy.  This was unfortunately dubbed by the media as creating an alleged “right to disconnect” and outlets like BlogTO and the Toronto Star rushed to declare that workers in Ontario could disconnect from work after-hours.

But if you read the news headlines and then reviewed the legislation and the guidance from the Ministry of Labour, you might be surprised to know that the media was a little disconnected (pun intended) from what the legislation actually requires.  

The legislation stipulates only the following:

• if an employer has 25 or more employees in Ontario, an employer must have a written workplace disconnection policy;
• the policy must address the topic of “disconnecting from work” which is defined under the ESA as “not engaging in work-related communications, including emails, telephone calls, video calls or sending or reviewing other messages, to be free from the performance of work”;
• the policy must be dated;
• the policy must apply to all employees (though the policy does not have to be the same for all employees, i.e. you treat managers differently than non-managers);
• the policy must be in place by March 1 if on January 1 of that same year the employer had 25 or more employees in Ontario;
• the policy must be provided to employees within 30 days of it being implemented or, if implemented, within 30 days of an employee’s new hire;
• a copy of the policy must be retained for 3 years.

The legislation does not specifically create a “right to disconnect”.  In other words, an employer could have a workplace disconnection policy that specifically says that employees do not have a “right to disconnect” and that would satisfy the policy requirement under the ESA.  Though, this is of course, subject to the ESA‘s overtime or hours of work requirements.  

What will the recently announced federal legislation look like?

Last week, the federal government signaled in its Budget 2024 that it intends to introduce legislation to amend the Canada Labour Code to create a “right to disconnect” for federally regulated workplaces (e.g. banks, airlines etc.).  The text of that legislation has not yet been released but it remains to be seen whether federal legislation will go one step further than Ontario legislation and actually create a “right to disconnect,” as opposed to just a policy requirement.

Takeaways for businesses

If you are a provincially regulated business in Ontario with 25 or more employees you need to have a workplace disconnection policy.

If you are a federally regulated business, Treiber Law will continue to monitor the Budget and its implementation legislation and provide updates as they become available. 

If you have any questions or need assistance with drafting a workplace disconnection policy for your workplace, please contact Treiber Law at info@treiberlaw.ca 

 This article should not be relied on as legal advice or legal opinion.