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Posts tagged: disability

Negligent misrepresentation during recruitment process costs employer $83,000

By , October 10, 2017 4:53 pm

Providing misleading information to an employee during the recruitment process about the eligibility for an employee benefits program cost an employer $83,000

Feldstein v 364 Northern Development Corporation

Mr. Feldstein applied for a software engineer position with 364 Northern Development Corporation (“the Company”). Before accepting the position, Mr. Feldstein asked the Company’s Chief Information Officer (“CIO”) about the eligibility requirements for the Company’s long-term disability (“LTD”) plan. As Mr. Feldstein suffered from cystic fibrosis, this information was very important to him, as he believed that he would require substantial LTD benefits in the future.

The CIO provided Mr. Feldstein with a brochure which summarised the Company’s LTD benefits, which contained a “proof of good health” clause. When Mr. Feldstein asked what this clause meant, the CIO explained that he would qualify for LTD benefits after working for the Company for three months. Based on this information, Mr. Feldstein accepted the position and signed an employment contract.

The employment contract in question contained the following “entire agreement” clause:

“This Agreement constitutes the entire agreement between the parties and supersedes all prior communications, representations, understandings and agreements whether verbal or written between the parties with respect to the subject-matter hereof.”

The purpose of an entire agreement clause is to prevent parties who have entered into a final contract from invoking prior discussions or understandings to give a different meaning to its provisions.

However, the contract did not contain any details of the benefits plan. Instead, the clause in the contract stated:

“The Employee shall be entitled to participate in all rights and benefits under any life insurance, disability, medical, dental, health and accident plans maintained by the company for its employees generally. In addition, the Employee shall be entitled to participate in all rights and benefits under other employee plan or plans as may be implemented by the Company during the term of this Agreement.

Shortly after accepting the position, Mr. Feldstein applied for LTD benefits as his health deteriorated significantly. He expected to receive full coverage of up to $5000 per month. Instead, Mr. Feldstein was only eligible for $1000 per month because he had not completed a medical questionnaire which was required to establish “proof of good health.” Mr. feldstein sued the Company for negligent misrepresentation.

Decision

The trial judge made the following findings:

  • the CIO’s explanation of “proof of good health” was inaccurate and misleading;
  • the Company was negligent in making this representation as the CIO had not taken any steps to verify the accuracy of the information he provided and the Company failed to provide Mr. Feldstein with the required medical questionnaire
  • it was reasonable for Mr. Feldstein to rely on the information the CIO provided; and
  • Mr. Feldstein would not have accepted an employment offer that did not provide adequate LTD coverage and acceptable eligibility requirements due to his health concerns.

The Company attempted to argue that the entire agreement clause in the employment contract meant that Mr. Feldstein could not sue for negligent misrepresentation. The court rejected this argument, as the CIO’s statement relating to the meaning of “proof of good health” was not an express term of the contract. As it was a matter outside of the contract, the clause could not exclude liability for pre-contractual misrepresentation.

Mr. Feldstein was awarded $83,336.80 as compensation for lost LTD benefits and $10,000 for aggravated damages. On appeal, the award for loss of benefits was upheld, but the aggravated damages were overturned.

Lessons to be learned

  1. Anyone interviewing a job applicant should provide accurate information concerning employee benefits; otherwise, the organisation may be required to self-insure for the value of benefits that are subsequently denied by the group insurer.
  2. Including an entire agreement clause in a contract like the one cited above does not always protect an employer from negligent misrepresentations made during the hiring process.
  3. It is important to periodically review employment contracts including entire agreement clauses and clauses dealing with group benefits to ensure they still protect employer interests in light of recent developments in the law.

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

Everything You Need to Know About Ontario’s Employment Laws

By , September 26, 2017 9:35 am

Now that I have your attention, let me outline three things you need to know.

  1. The Ministry of Labour is devoting considerably more resources to enforcing the Employment Standards Act (the “ESA”) and your organization is more likely to be inspected.

Earlier this year, the government announced it was hiring an additional 175 enforcement officers. In addition, I expect amendments to the ESA will be passed this fall by way of Bill 148 which will impose several new obligations on employers.

If your organization is inspected you will be asked, among other things, if you have: posted certain required written policies; provided employees with required training & documentation; posted certain required information in a conspicuous place; and, complied with the new obligations imposed by Bill 148. If not, then the inspector will issue orders and you must comply with these orders. If not, your organization will be subject to significant fines.

Are you ready for an inspection?

  1. About 50% of the complaints that are filed with the Ontario Human Rights Tribunal deal with disability related discrimination. In many cases, an employee claims the employer has failed to accommodate a disability. So chances are you will receive a request for accommodation at some point in time.

Responding to a request for accommodation can be extremely complicated. Failing to do so can be extremely costly.

Did you know that there is a procedural duty to accommodate and a substantive duty to accommodate?

Did you know that in some cases you have a duty to ask an employee if they have a disability?

Did you know that in some cases you have a duty to offer another position to a disabled employee?

Do you know whether or not you can require an employee seeking accommodation to see a doctor of your choosing?

Did you know that some employers are required to prepare a written individual accommodation plan for a disabled employee?

Do you feel comfortable responding to a request for accommodation?

  1. A well drafted employment contract is, in my opinion, the best employment law investment you will ever make. For various reasons it needs to be reviewed periodically.

In an era when the government is taking away management rights, did you know that an employment contract can add to your management rights?

In an era when courts are refusing to enforce termination clauses (and other clauses)  in employment contracts, did you know that you need to periodically review your contract to make sure it doesn’t need to be amended?

When the government imposes new obligations on employers such as the ones that are contained in Bill 148, did you know that you need to review your employment contract to make sure it complies with the ESA? For example, if your contract states that an employee receives two weeks vacation each year then this clause will need to be changed if one section in Bill 148 becomes law this fall.

The MacLeod Law Firm is not in the seminar business. I believe these topics are so important, however, that I am holding a seminar in Toronto on October 16th and in Barrie On October 20th to discuss them.

For more information about the seminar, click here.

For over 25 years, Doug MacLeod of the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him directly at 416 317-9894 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

 

Can my organization implement a drug testing policy at the workplace?

By , July 24, 2017 10:24 am

If you’ve been following the news over the last few months, you know that the Ontario Superior Court of Justice refused to allow the union’s injunction against the TTC’s random drug and alcohol testing policy. More recently, the Supreme Court of Canada upheld the termination of an employee who was terminated for violating his employer’s drug testing policy. These developments have led to us answering many questions from employers (and news publications) about whether they can also test their employees for drugs and alcohol.

Despite the TTC’s success at court, employers should proceed with caution when instituting drug and alcohol testing at the workplace. Firstly, the issue before the court was not whether such a policy was discriminatory. Secondly, the court refused the union’s injunction because of both the safety-sensitive industry and the wide area in which the TTC operates. Furthermore, the caselaw preceding the TTC decision shows that there is a high evidentiary burden an employer must satisfy to justify random drug testing its employees.

Because addictions to drugs or alcohol are considered “disabilities” under the Ontario Human Rights Code, drug and alcohol testing has human rights implications for people with addictions. For example, a human rights issue may arise where a positive test leads to automatic negative consequences for a person based on an addiction.

However, courts and tribunals recognise that it is a legitimate goal for employers to have a safe workplace, particularly in safety-sensitive industries. Therefore, there is caselaw that has recognised that a drug testing policy is justifiable if an employer can show that the policy is a bona fide (i.e. legitimate) requirement of the job. However, even if the policy is a legitimate requirement, employers should strive to minimise any potential discriminatory impact, and be prepared to accommodate employees with addictions who are negatively impacted by the policy.

Another requirement for a drug and alcohol testing policy to be found justifiable is that it must measure impairment, as opposed to drug or alcohol use. For example, while alcohol testing is able to measure a person’s impairment quite accurately, because drugs can remain in a person’s system for quite some time after their use, drug testing is less accurate at measuring impairment rather than drug use. For this reason, alcohol testing tends to be more permissible than drug testing. Similarly, testing after an accident or a “near-miss” is more justifiable than random testing.

Lessons to be Learned

As we get closer to marijuana being legal in Canada, questions around workplace safety and the permissibility of drug testing are bound to increase. We will continue to publish additional information as more relevant cases are released. In the meantime, if you are considering implementing a drug and alcohol testing policy at the workplace, you should consult an employment lawyer to find out whether such a policy would survive the scrutiny of a court or tribunal.

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

The Perils of Dismissing a Disabled Employee

By , July 12, 2016 1:08 pm

On June 30, 2016 the Ontario Court of Appeal (the “OCA”) released its decision in a case involving the dismissal of a disabled employee who earned about $ 22 000 per year. I wrote about the trial decision in April (see here for my blog post).

The OCA increased the damages the employer was ordered to pay from about $ 110 000 to about $ 245 000 which was basically the amount the person claimed in her Statement of Claim. One wonders if the OCA would have ordered the employer to pay more damages if the employee had sought more damages.

This decision is an evolution of the OCA’s 2014 Walmart decision which awarded an employee significant damages in addition to traditional wrongful dismissal damages. I have also written about the Walmart decision (see here).

The Facts

Ms. Strudwick worked for an employer that recruits individuals to participate in focus groups. She was paid $ 12.85 per hour and her duties involved data entry, and instructing recruiting staff.

In 2010, Ms. Strudwick became deaf. According to the trial judge: “…her employer’s attitude towards her and treatment of her became unconscionable. The plaintiff deposed she was constantly belittled, humiliated and isolated.” Among other things, the employer refused to accommodate her disability.

Damage Award

Wrongful Dismissal Damages

At the time she was terminated, Ms. Strudwick was 59 years old, had worked for almost 16 years, and held an administrative position. The trial judge ordered the employer to pay her a total of 24 months’ pay in lieu of notice and about $ 6000 in lieu of lost benefits during that time. This included twenty months pay in lieu of reasonable notice of termination and 4 months pay for bad faith termination or Wallace Damages. The OCA applied the traditional Bardal Factors and deferred to the trial judge and upheld the 24 month damage award which is the unofficial cap on wrongful dismissal damages.

Human Rights Damages

The judge awarded her $ 20 000 in general damages under the Ontario Human Rights Code. The OCA looked at court cases and Ontario Human Rights Tribunal cases including one of our cases and increased the damages to $ 40 000.

Damages for Intentional Infliction of Mental Stress

The judge concluded that the employer’s conduct caused Ms. Strudwick to suffer an adjustment disorder with mixed anxiety and depressed mood which required psychological treatment and ordered the employer to pay almost $ 19 000 for the cost of this treatment. The OCA increased this damage award to $ 35 294 including $ $5,000 to address Ms. Strudwick’s pain and suffering, and loss of enjoyment of life.

Aggravated Damages

The trial judge awarded Ms. Strudwick no aggravated damages. Taking all of the abuse Ms. Strudwick endured, the OCA decided to award her $61,599.82 damages after deducting the Wallace Damages she was awarded.

Punitive damages

The judge ordered $ 15 000 in punitive damages because he did not think the other damage awards adequately accomplished the objectives of “retribution, deterrence and denunciation.” The OCA increased this amount to $ 55 000.

I expect this decision will hasten the trend for employee side lawyers to claim non-traditional damages in wrongful dismissal cases. The OCA’s decision to increase the damage amount in four of the damage claims will likely mean that employee counsel will be seeking higher settlements in the future.

I will be interested to see if the employer appeals this decision to the Supreme Court of Canada (the SCC”) and if the SCC grants leave to appeal how the SCC will view this case in light of its 2008 decision in Honda.

Lessons to Be Learned

  1. Disabled employees have additional legal rights. Accordingly, employers should make themselves aware of these rights. For more information on the rights of disabled employees, click here.
  2. Any request for accommodation should be taken very seriously and failure to do so can result in significant legal damages. For information on the duty to accommodate, click here.
  3. Trying to force an employee to quit – especially a disabled employee – can result in additional legal damages.
  4. Judges have the discretion to order an employer to pay a sympathetic employee many different types of damages. For more information on different types of wrongful dismissal damages, click here.
  5. Always consult with an employment lawyer before terminating a disabled employee.

AODA Update: New Regulation Taking Effect July 1, 2016

By , June 27, 2016 11:56 pm

The Accessibility for Ontarians with Disabilities Act (“AODA”) is constantly changing. So when there has been yet another change to AODA it takes all of my energy not to cover my ears and yell “LAH, LAH, LAH” at the top of my lungs.

Employment Standards Regulation: January 1, 2017

The most important amendment to AODA that applies to employers with 1 to 49 employees takes effect on January 1, 2017. For a description of our compliance service in connection with the Employment Standards Regulation, click here.

Ontario Regulation 165/16: July 1, 2016

Before the Employment Standards takes effect, however, another regulation – O. Reg. 165/16 – will take effect on or about July 1, 2016. It will consolidate all of the accessibility standards in the Integrated Accessibility Standards Regulation. Thereafter both small (1 to 49 employees) and large (Over 50 employees) organizations will be required to do the following:

Changes to AODA Requirements

  1. Training– currently, organizations are only required to provide customer service training to employees and volunteers who deal with third parties, and those who participate in developing the organization’s policies. However, the new regulation will require organizations to, as soon as practicable, train: (a) all employees and volunteers; (b) every person who participates in developing the organization’s policies; and (c) every other person who provides goods, services or facilities on behalf of the organization.
  2. Documenting policies, practices and procedures – currently, organizations with 20 or more employees must “document” their customer service policies, practices and procedures, and make a copy of that document available on request. However, when this regulation takes effect, this requirement will only apply to organizations with 50 or more employees. In other words, organizations with 20 to 49 employees are no longer required to document their customer service policies, practices and procedures.

Besides documenting their customer service policies, practices and procedures, large organizations must also (a) notify persons to whom it provides goods, services or facilities that the document which describes the organization’s policies, practices and procedures is available upon request; and (b) prepare a document that describes the organization’s training policy, summarizes the content of the training and specifies when the training is to be provided. Both documents must be provided to any person upon request.

All organizations with 20 or more employees must confirm their compliance with the above requirements by submitting an accessibility compliance report by no later than December 31, 2017.

Lesson to Be Learned

We recommend that you review and update all of your organization’s AODA policies, practices and procedures to ensure you are in compliance with the upcoming changes.

MacLeod Law Firm Update

I am very pleased to announce that I have hired Nadia Halum as our newest associate lawyer. She articled for us this past year. Please join me in welcoming Nadia to our firm. She can be reached at (647) 985-9894 or [email protected]

 

For over 25 years, Doug MacLeod of the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him at 416 317-9894 or at [email protected]

“The material and information provided on this blog and this website are for general information only and should not, in any respect, be relied on as legal advice or opinion. The authors make no claims, promises or guarantees about the accuracy, completeness, or adequacy of any information linked or referred to or contained herein. No person should act or refrain from acting in reliance on any information found on this website or blog, without first retaining counsel and obtaining appropriate professional advice from a lawyer duly licensed to practice law in the relevant jurisdiction. These materials do not constitute legal advice and do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.”

 

 

 

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