For US employers opening up for business in Canada, the legal obligations they have towards employees may seem daunting to figure out. There are many things to consider, but a common theme through much of it is the aim of protecting workers. And that means employers have to focus on protecting workers, too – particularly when it comes to the work environment.
An employer can face significant legal liability if it allows a toxic workplace to develop under its nose. A toxic workplace is generally considered to be where there’s a series of incidents causing some sort of harm to an employee or employees – such as harassment, discrimination, workplace bullying, or violence – that happen in the workplace, and the employer essentially condones them. A key way to fight these workplace problems is to have policies and procedures in place for employees to file complaints and for the employer to investigate those complaints. Inaction on the employer’s part, when it’s aware of the problem, can be seen as condonation of the toxicity.
It’s not just a best practice to investigate potential workplace harassment or bullying. It’s also a legal duty on the employer. In many Canadian jurisdictions, employers have a duty under occupational health and safety legislation to protect employees from workplace harassment and violence. For example, in Ontario, the Occupational Health and Safety Act (OHSA) requires employers to have clear policies in place to address them. A safe workplace is one free from harassment and bullying.
Of course, simply having policies and procedures in place doesn’t make the workplace safe. Employers have to follow them, and a failure to do so can breach not only occupational health and safety legislation, but also a common law duty to investigate.
Fair and reasonable investigation
When an employer receives a complaint from an employee, it’s obligated to act quickly and to conduct a fair and reasonable investigation. All complaints have to be taken seriously, regardless of whether the employer thinks it has merit or not. A fair and reasonable investigation includes things like interviewing the complainant to get all the details, allowing the accused an opportunity to explain their side of the story, and interviewing all relevant witnesses. Second interviews may be necessary as well if new information comes to light during the investigation.
The duty to investigate doesn’t just activate when an employer receives a complaint. Under certain circumstances, there may be a duty to investigate even if there’s no complaint. If an employer becomes aware of potential harassment or bullying going on in its workplace, it may have a duty to inquire, particularly if there’s an individual employee being targeted. Turning again to the Ontario OHSA as an example, the employer’s obligation to perform an investigation is triggered not just by a formal complaint, but also once it becomes aware of a workplace incident or employee misconduct in any way.
Even if the legal duty to investigate isn’t triggered, inaction by the employer could be allowing a toxic workplace to fester, potentially leading to liability down the line.
A failure by an employer to live up to its legal duty to investigate workplace harassment or bullying can have serious and expensive consequences. In the 2019 decision of Bassanese v. German Canadian News Company Limited et al., a worker with 19 years of service complained to her company president several times about another employee’s abusive and harassing behaviour towards her over a “prolonged period of time.” The president spoke to the HR department, but nothing more was done. Finally, the situation escalated when the colleague slapped the worker, who was terminated the same day. An Ontario court ordered the employer to pay the worker nearly $130,000 in damages, including 19 months’ pay and benefits in lieu of notice, $50,000 in aggravated damages, and $15,000 in vicarious liability for the colleague’s assault and battery of the worker.
No formal complaint
Another Ontario case in 2024 demonstrated an employer’s duty to investigate without a formal complaint. In Metrolinx v. Amalgamated Transit Union, Local 1587, the employer learned through a female employee’s informal comments to her manager about an online group chat involving several employees that contained sexually harassing references to the female employee. Although the employee who was the subject of the comments declined to make a complaint, the court found that it was reasonable for the employer to investigate without her participation, as all employees were entitled to a workplace free from harassment.
Simply conducting an investigation doesn’t necessarily fulfill an employer’s duty to investigate. As mentioned above, the investigation is legally required to be fair and reasonable. If it isn’t, the employer could face a similar fate as the one in McGraw v. Southgate (Township), which was ordered by an Ontario court to pay a worker $190,000 in moral damages, damages for discrimination, damages for defamation, and punitive damages, plus six months’ notice, for a flawed investigation into misconduct for which the worker was fired. The court found that the investigation relied heavily on rumours and second-hand information while failing to interview the worker herself or obtain direct evidence of the worker’s misconduct.
However, the duty to investigate doesn’t extend past the employment relationship or if there’s no evidence of any misconduct. In a 2014 decision Scaduto v. Insurance Search Bureau, the Ontario Human Rights Tribunal determined that an employer didn’t have a duty to investigate a worker’s complaint that he was more harshly treated because he told his supervisor he was gay. The reason? The worker revealed this information at his termination meeting after he had already been terminated, and the employer had no duty to ensure the worker was free from a discriminatory environment when the worker was no longer in that environment. It helped the employer’s case that the tribunal agreed that there was no evidence of discrimination, and therefore no duty to investigate anyway.