Facing the Facts on Workplace Toxicity

“Condemnation without investigation is the height of ignorance.” – Albert Einstein

As lawyers, we pride ourselves on solving problems logically in accordance with fact and reason. On a host of legal exercises — from due diligence on a real estate deal to drafting agreements and defending lawsuits — we encourage and sometimes even scold our clients when they make decisions devoid of fact and reason. Interestingly, though, when it comes to potential liability on “softer” matters such as a toxic work environment, sexual and non-sexual harassment, bullying, and other forms of misconduct, many of our clients still go it alone. Members of the employment law bar in Alberta are all-too familiar with this reality.

You receive a call from your client who informs you there has been a report of harassment-one that raises a host of liabilities for your client. The client has reached out for your razer-sharp legal analysis after receiving a demand letter from plaintiff counsel. The client informs you that the complaint was made two weeks ago, but not to worry, HR and admin have already “looked into it.”

You then learn that the alleged perpetrator of the harassment has been terminated for just cause after HR interviewed the complainant. No further investigation was conducted. Not surprisingly, the client is now facing a wrongful dismissal lawsuit by the dismissed employee and seeks a legal opinion as to their risk exposure moving forward.

You’re left in the wonderful position of giving a quasi-theoretical evaluation of your client’s circumstances-one loaded with uncertainty, speculation, or disclaimers.

Obviously, many of our clients would have handled the situation very differently; however, there is no shortage of real-world comparisons to draw from. Consider the following cases:

• Calgary (City of) v. Canadian Union of Public Employees, Local 38, 2013 Canlii 88297, in which the Court awarded $125,000 in general damages after finding the employer failed to take timely and proper steps to investigate a sexual harassment complaint.
• Elgert v. Home Hardware Stores Limited, 2011 ABCA 112, aff’g in part 2010 ABQB 43, in which the dismissed employee was awarded 24 months’ lost income, $200,000 in aggravated damages, and $300,000 in punitive damages, later reduced to $75,000 on appeal. The Court found that Elgert was wrongly accused of sexually harassing two female employees, after Home Hardware’s flawed and biased investigation into the matter. Importantly, the Court of Appeal acknowledged the existence of a legal basis- found in Honda v. Keays-for an aggravated damages award as the flawed investigative process fell under the ‘manner of dismissal.’
• Boucher v. Wal-Mart Canada Corp, 2014 ONCA 419, in which Wal-Mart’s investigators ignored information supporting a harassment and bullying complaint and failed to demonstrate any reasonable degree of diligence in pursuing factual information from witnesses.  The plaintiff was awarded $200,000 in aggravated damages; $100,000 in punitive damages; and, her full notice entitlement.

While certainly significant — and likely to get more so over time — the damage sums in these examples may only the be the ‘tip of the iceberg’ for organizations that leave workplace toxicity uninvestigated and unchecked.

The cautionary tales are seemingly all around us these days – be it the recent $40 million class action lawsuit against the Calgary Board of Education, for a failing to investigate and take steps to prevent historical sexual abuse by a teacher, or the Chicago Blackhawk’s failure to investigate “an open secret” of sexual misconduct against a longtime video coach. While these may be extreme cases involving high-profile organizations, similar legal, financial, and reputational risk lies beneath the surface for all our clients.  

These days, most organizations in Alberta have awoken to the potential risks associated with workplace toxicity. They have drafted harassment, bullying, anti-violence and OHS policies, invested in workplace sensitivity and inclusivity programs, and might have even hired senior HR executives. But that’s not enough.

As lawyers, it’s no longer acceptable to advise our clients from a far on these issues; we need to keep pace with these evolutions, by working alongside our clients to foster a level of ‘due process’ and accountability to fact, logic, and process that we espouse as officers of the Court. We can start by being proactive in helping clients develop policies and investigation systems (internal and external) to manage complaints promptly, fairly, and effectively. Human resource professionals make invaluable contributions to their organizations, but when it comes to maintaining a safe and healthy work environment, modern workplaces now require a level of infrastructure, training and support best provided by legal professionals.

The results will be immediate: a healthier and more transparent workplace culture by staying ahead of complaints before they become crises, and more confident and decisive personnel decisions, such as terminations, which rest on a thorough and unbiased investigative process.