In continuation of this blog series, here are some more notable cases over the last decade that employers and HR leaders can learn from to truly understand the cost of getting workplace investigations wrong. In case you missed the first part of this blog series, you can read it here.

2017 ONCA 130

$85,000 + 10 months’ salary + substantial legal costs (nearly $500,000) awarded

Summary:

The employee in this case was a 48-year-old female plant supervisor who worked for 9 years for the employer, a chemical manufacturing company. The employee was the only female on the plant floor and the work environment was characterized as having a “locker room mentality” that was predominantly male. 

The employee alleged she was sexually harassed by the maintenance manager whom the employer considered irreplaceable. She first complained through a third-party company engaged to conduct an employee survey on workplace violence and harassment and then she confronted said maintenance manager directly as well hoping that the behaviour would stop. Although the harassment subsided in the short term, it later resumed and escalated which caused her to file another complaint.

The complaint was reported to the Assistant GM who was dismissive of the situation and faulted the employee for being “too sensitive”, even though, a third-party company had previously found there was a culture of intimidation, bullying, and verbal abuse with a history of violence and recommended a training plan for the employer to meet its obligations under the Occupational Health and Safety Amendment Act (Violence and Harassment in the Workplace) 2009 (introduced as Bill 168). However, none of the recommendations were followed. 

A one-day “cursory” investigation was conducted by the Assistant GM who had no experience in conducting investigations. Only the maintenance manager was interviewed and he denied all the allegations, but the employee was never given an opportunity to respond as she was not even a part of the investigation. 

Within 5 days of filing the complaint, the employee was terminated without cause despite being assured her job was not in jeopardy. It was positioned to her during the termination meeting that she was “being irresponsible” for complaining as it risked damaging the employee’s reputation. To add insult to injury, the employer later tried to dig up dirt on the employee to justify terminating for cause after the fact.

Findings:

• Court found that “the investigation was one sided and the outcome obvious before the investigation began”.
• Employer’s hard-line approach with the employee was a way of getting rid of the sexual harassment complaint before the employer’s company could be sold. 
• Significant moral damages were awarded due to the “callous” way the employee was treated pre and post-termination.
• Investigation was found to be “too short, was unreasonable, was not impartial, and ignored advice to deal with the sexual harassment complaint before proceeding with termination”.
• “The tip line set up by the employer to deal with sexual harassment was inadequate as it did not provide anonymity to the employee. The employer failed to implement compliance procedures required by law to address sexual harassment in the workplace”.

Takeaways:

Mistreatment of employees before and after termination can expose employers to increased legal liability. In this instance, it resulted in nearly $500,000 in legal costs after appeal and significant moral damages being awarded. 

There are also risks when employers ignore third-party recommendations and advice intended to prevent and address workplace violence and harassment incidents as it can serve as evidence against the employer for failure to act and comply with its legal obligations.

It is essential to conduct internal investigations using well-trained professionals who possess a comprehensive understanding of relevant laws and the necessary skills to conduct thorough inquiries. Superficial investigations done merely to fulfill obligations can be more damaging than not conducting one at all. To mitigate these risks, outsourcing to competent independent investigators who meet these criteria is recommended.

2014 ONCA 419

$410,000 + 20 weeks’ salary

Summary:

The employee in this case worked as an assistant manager of the employer with 10 years of service. She was a good employee with no prior issues but after refusing to falsify a temperature log as requested by her manager, the relationship turned sour. 

The employee complained to the employer’s management about the incident, but nothing was done. Instead, word travelled back to her manager that she had complained. That’s when the unrelenting abuse started. 

The employee filed a harassment complaint to HR against the assistant manager. According to the employee, the assistant manager’s conduct was “flagrant and outrageous. He belittled, humiliated and demeaned [the employee] continuously and unrelentingly, often in front of co-workers, for nearly 6 months”.

To the employee’s dismay, an internal investigation found her claims to be unsubstantiated. To make matters worse, the employee was further warned by the company that she would be held accountable for making the allegations. 

Without any support or meaningful intervention from the company, the bullying continued despite her complaints to HR. The employee’s health began to suffer. The workplace mistreatment took a tangible toll on her well-being, leading to provable illnesses directly attributed to the toxic work environment she endured. This eventually led her to resign and sue for constructive dismissal.

Findings:

• Court found the employee had been constructively dismissed and significant damages were awarded for intentional infliction of mental suffering, aggravated and punitive damages based on the mistreatment by her manager.
• The assistant manager’s actions were outrageous and intended to cause harm to the employee for which he was found personally liable.
• Aggravated damages were awarded against the employer due to its failure to enforce its own policies, and failure to protect the employee from threats of retaliation.
• Internal investigation conducted was found to be flawed and biased.
• The employer was aware of the assistant manager’s conduct and failed to intervene to prevent it from recurring.
• The employer breached its duty of good faith and fair dealing towards the employee.

Takeaways:

One of the key challenges with internal investigations is the potential for bias and internal politics that can influence the investigation’s outcome, as highlighted in a previous blog post on my website – Inside HR: Challenges with Internal Workplace Investigations. HR often finds itself in a difficult position when management is implicated and their impartiality may be questioned due to existing conflicts of interest. 

In these scenarios, the selection of an investigator is as important as the investigation itself. The chosen individual must be unbiased, independent, competent, and perceived as neutral by all parties involved. Without these attributes, the investigation’s result may not withstand legal scrutiny.

Additionally, it is prudent to handle complaints filed in good faith but later found to be unsubstantiated with care. There should be no consequences imposed on the complainant in such cases. According to OHSA regulations, employers are explicitly prohibited from threatening, disciplining, or retaliating against employees who participate in or file complaints. The possibility of disciplinary actions should only be entertained when allegations are maliciously made.

It is also important to acknowledge that in cases of severe workplace bullying and harassment, both the company and the offending employee may be held accountable and liable for their actions. A culture of respect, support, and accountability is vital in ensuring a healthy and productive work environment for all employees. 

2013 CarswellAlta 2593, 117 C.L.A.S. 87 (Alta. Arb.)

$869,022 awarded

Summary:

In this case (you must have a Westlaw account to access the transcript of the case), the employee worked as a city clerk in the roads department and was sexually assaulted multiple times at work by a senior foreman. The abuse was reported to her superiors, but no actions were taken to address it. Instead, her manager went on vacation and left the senior foreman in charge. This made the matter worse as it subjected her to further sexual assaults despite her complaints. 

Faced with a lack of action from her superiors, the complainant took matters into her own hands and hid a camera by her workstation that recorded the senior foreman fondling her. This evidence was later reported to corporate security and an investigation ensued which ultimately resulted in the senior foreman’s suspension. 

However, the situation didn’t improve after the senior foreman returned to work following the suspension, as the complainant found her keyboard sabotaged, suggesting further retaliation against her. 

The employee left on medical leave and she suffered mental distress due to the workplace assaults and how it was handled internally which drove her to the brink of suicide. The Police later got involved and the senior foreman was later charged and served jail time for his misconduct in the workplace. 

Findings:

• Sexual harassment was found to be egregious and general damages were awarded as well as past and future loss of earnings up to retirement age.
• The employer’s failure to deal with serious complaints breached its duty to protect the employee from harassment.
• There was also no effort or steps taken to protect the employee from reprisals.
• The employer’s own policies were not followed in handling the complaints.

Takeaways:

Sexual harassment and assault is a criminal offence, which adds an additional layer of liability for employers beyond the Human Rights and Occupational Health and Safety laws. Employers have a legal duty to protect employees from all forms of harassment and discrimination. Therefore, ensuring a safe and respectful work environment requires companies to take complaints seriously, promptly investigate concerns and handle the situation with care and compassion.

From the outset, an employer’s actions are closely scrutinized, even before any investigation begins. To avoid potential challenges, consistent adherence to internal policies and procedures for addressing workplace harassment and violence is important.

Employers can also be found vicariously liable for the actions of their employees within the workplace. Consequently, comprehensive training should also be provided to all employees, outlining their roles, responsibilities, and company expectations concerning workplace violence, harassment, and discrimination.

It is clear from these cases that the cost of getting it wrong in workplace investigations can be very steep. An employer must take seriously its obligations to respond to and investigate allegations of workplace harassment. Each case provides valuable lessons for employers on what not to do. 

Don’t wing it! The impacts can be far-reaching beyond legal ramifications when you consider the reputational damage, disability costs, and morale impacts organizations can suffer stemming from a flawed workplace investigation.