Ontario Employer Not Liable for Harassing Conduct between Employees

Previously printed in the CCH’s Focus on Canadian Employment and Equality Rights Newsletter.

The Ontario Human Rights Tribunal recently made an interesting finding with respect to an employer’s limited responsibility for harassing conduct between employees in Baker v. Twiggs Coffee Roasters, 2014 HRTO 460 (Carey).

The facts of the case are unique to say the least. The applicant alleged that her employment with the respondent was terminated due to her pregnancy. The allegations were based largely on communications, many via text message, to the applicant from another employee of the respondent (the “co-worker”). The co-worker had exaggerated her authority within the respondent’s business, leading the applicant to believe that she had authority over employment matters, and had also verbally, or by way of text messages, engaged in the following conduct:

• Told the applicant for no apparent reason not to disclose her pregnancy to their mutual employer;
• Lied to the applicant repeatedly about intending to disclose the pregnancy on the applicant’s behalf;
• Made gratuitous statements about the employer’s attitude towards pregnant women;
• Pretended she informed the employer of the applicant’s pregnancy when she had not; and
• Then sent a number of texts falsely indicating the employer was terminating the applicant’s employment because she was pregnant.

[At para. 163.]

The Tribunal dismissed the primary allegations of discrimination on the basis of gender/pregnancy against the applicant based on its findings that: (a) the decision to terminate the applicant’s employment was made by two managers, and not in any manner by the co-worker; and (b) the managers who made the decision had no knowledge of the applicant’s pregnancy at the time they decided to terminate her employment.

The Tribunal went on to consider, however, whether the respondent was nonetheless liable to the applicant for the arguably harassing nature of the co-worker’s conduct summarized above. As the Tribunal put it:

Despite the fact that the applicant’s pregnancy was not in actuality connected to the respondent’s decision to terminate her employment, [the co-worker’s] behaviour in telling the applicant otherwise in a series of texts had the same impact on the applicant as if she had actually been dismissed because of her pregnancy.

Section 7(2) of the Ontario Human Rights Code, R.S.O. 1990, c. H.19 (the “Code”) protects employees from workplace harassment by an “employer or agent of the employer or by another employee” [emphasis added]. The Tribunal held that the Code protects employees from workplace harassment on the basis of pregnancy.

Given that the co-worker was not, herself, a party to the application, the Tribunal made no specific findings against her, but considered that her conduct may well have constituted harassment contrary to the Code. The Tribunal held, however, that the respondent could not be held liable for the co-worker’s conduct given the provisions of section 46.3(1) of the Code which provides:

For the purposes of this Act, except subsection 2(2), subsection 5(2), section 7 and subsection 46.2(1), any act or thing done or omitted to be done in the course of his or her employment by an officer, official, employee or agent of a corporation, trade union, trade or occupational association, unincorporated association or employers’ organization shall be deemed to be an act or thing done or omitted to be done by the corporation, trade union, trade or occupational association, unincorporated association or employers’ organization.

[Emphasis added in the original.]

This provision has been interpreted to preclude findings that employers are vicariously liable for sexual harassment perpetrated by their employees, agents or officers. Such complaints are instead to be brought against the individuals who actually commit the harassment: Ontario Human Rights Commission v. Farris, 2012 ONSC 3876 (S.C.J.) at para. 32. The courts have also held, however, that management employees who are aware of and fail to take steps to prevent discrimination and harassment may be personally liable for the results of the conduct, and when management persons who perpetrate or fail to prevent harassment are directing minds of the organization so too will the organization be liable.

In other words, while section 46.3(1) prevents a finding that employers are vicariously liable for harassment perpetrated by employees, agents or officers, employers may be directly liable for acts or omissions that lead to the perpetration or continuation of harassment, including acts or omissions of managers who are part of the directing mind of the employer organization.

In the unique facts before the Tribunal, the respondent demonstrated that it knew nothing of the co-worker’s comments or text messages to the applicant. Indeed, the evidence showed that the co-worker had actively lied to respondent managers when they attempted to investigate her conduct. Similarly, the respondent could not have been expected to have access to the co-worker’s private text messages. The Tribunal was satisfied that there was nothing more the respondent could have done in the circumstances and dismissed the complaint against the respondent.

This decision confirms that Ontario employers will not be liable for harassing behaviour between employees when the employer can demonstrate that it: (a) was unaware of the improper or inappropriate behaviour; and (b) could not have taken reasonable steps to prevent it. The Tribunal’s decision in this case was clearly influenced by its acceptance of the fact that the co-worker was a “rogue” employee engaging in conduct which could not have been reasonably anticipated or prevented by the respondent. The Tribunal’s finding would certainly have been different had any of the co-worker’s behaviour toward the applicant been known to and not remedied by a member of the respondent employer’s management team.