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Why Do Businesses Need Workplace Policies?

Many businesses view drafting workplace policies as a Human Resources function rather than a legal one. Undoubtedly, legal services and HR consultants are an added cost to business operations. After all, small businesses, especially start-ups, don’t have a dedicated HR department to retain a lawyer, let alone extra cash in operations. Therefore, workplace policies are an afterthought for many employers, especially those just starting out. In this context, workplace policies’ preventive role and value in warding off litigation are often underestimated.

What makes the situation even worse is that some businesses resort to using HR templates available on the Internet, neither vetting their content, recency, nor applicability to the jurisdiction in which they operate. Would a template drafted for local businesses in the U.S. be adequate and compliant with the local, provincial, and federal legislation, rules, and regulations? The answer is a definite “NO.” Consider the difference. The U.S. is a fire-at-will jurisdiction. There are scares protections available to employees under the human rights protection laws. Otherwise, employers are free to terminate workers at will. Contrary to this employment law regime, Canadian workers are in a better situation with the statutory minimums available under Ontario’s Employment Standards Act, 2000, and Occupational Health and Safety Act, 1990, as well as Ontario’s Human Rights Code, 1990.

Instead of focusing on the risks and dangers of not adequately drafted policies, let’s zoom in on the preventative role that carefully drafted workplace policies play in creating and maintaining a safe, harassment- and discrimination-free work environment. While the Occupation Health and Safety Act requires employers to develop a workplace violence and harassment policy under Part III.0.1, the Human Rights Code protects employees from harassment in the workplace under s.5(1) and (2). A series of recent Ontario-based judgements highlight that harassment in the workplace, including sexual harassment, remain a serious issue in the workplace.

The appellate decision in Render v Thyssenkrupp (Elevators) Canada Ltd. confirmed that a single incident of harassment, where a male co-worker slapped a female co-worker on her buttocks, led to his termination for cause. Thyssenkrupp, the organizational respondent, in this case, introduced a new Anti-Harassment and Anti-Discrimination Policy, which overrode some of the steps involved in progressive discipline for the alleged misconduct. Further, the employer provided its employees with training on how this newly revised policy applies in the workplace. Both the appellant and the responded attended an HR training provided via a PowerPoint presentation and participated in a follow-up discussion. To put it in the words of the Court of Appeal for Ontario in Render,

The policy states that the respondent has “zero tolerance” for harassment and discrimination, provides that sexual advances and touching are considered sexual harassment, states that sexual harassment can arise from a single incident and may include public humiliation, and states that an employee who engages in conduct that is contrary to the policy will be subject to appropriate discipline, up to and including termination of employment.

As a result, the employer was justified in adhering to its zero-tolerance sexual harassment policy and terminating the non-compliant employee for misconduct severe in nature. Notably, this policy provided for the consequence associated with the said misconduct, including termination of employment. At common law, summarily dismissal for “just” cause or “being bad on purpose” is outlined in Plester v Polyone Canada Inc. Although termination by the employer was upheld, entitlement to termination pay was partially upheld by the Court. The Court found, however, that appellant’s conduct did not disentitle him from termination pay in the amount of 8 weeks of salary. The appellant’s misconduct, in this case, did not rise to the level of “wilful misconduct” as defined in s. 9(1)6 of the O. Reg. 288/01 “Termination and Severance of Employment” under the Employment Standards Act.

In another Ontario judgement by the Superior Court of Justice in Incognito v Skyservice Business Aviation Inc., the plaintiff relied on the corporate code of conduct, the Human Rights Code and remedies available at common law to assert that sexual assault coupled with sexual harassment should constitute an independent tort (or wrong) of sexual harassment, which attaches liability to both the tortfeasor and his employer. Although the court confirmed that there is no separate tort of sexual harassment, an employer cannot be vicariously (that is, in addition to the perpetrator) held liable for sexual harassment by creating an unsafe work environment and failing to investigate complaints. However, an employee who experienced harassment at the hands of another employer can file a stand-alone claim with Ontario’s Human Rights Tribunal. Despite this finding in Skyservice, the court also concluded that s. 46.1 of the Human Rights Code allows the claimant to seek civil remedy in the form of monetary compensation for the breach of the Code if the said breach is associated with another tortious action. In this case, the interpretation of the corporate code of conduct, along with case law and regulations, formed the basis of this novel legal claim. Although the plaintiff was unsuccessful in making a legal breakthrough in tort law, employers must be cautious when drafting their employment policies.

To summarize, Render introduced a stricter treatment of single instance misconduct of sexual harassment, while Skyservice reviewed the basis of vicarious liability of the employer for sexual harassment. What do all these cases have in common? Workplace policies set employers’ expectations and respective obligations of employers and employees, including the statutorily defined norms of respectful conduct. As the Court stated in Render, “[e]very workplace should be based on mutual respect among co-workers. An atmosphere of mutual respect will naturally generate the boundaries of behaviour that should not be crossed.” Workplace policies compliant with requisite laws and regulations help employers meet their implied obligations towards the employees to keep the workplace safe and free from harassment and discrimination. Finally, when it comes to contextual analysis, a carefully drafted policy may serve as a sword and a shield when addressing employee misconduct and employer’s liability for sex-based discrimination, including under s. 5(1) of the Human Rights Code as illustrated in the tribunal jurisprudence in A.B. v C.D.

This blog is by no means an exhaustive review of recent case law. It only provides a brief overview and legal information about the value of having workplace policies in place. It is provided for informational purposes only, should not be relied upon as legal advice, and is solely in accordance with the laws of Ontario.

To book a consultation with Buzaker Law Firm regarding specific legal advice and assistance in drafting mandatory workplace policies for your business, please contact us at: or (905) 370-0484.

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