Court of Appeal sends strong message on sexual harassment by supervisory personnel, twice

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Two unanimous decisions issued on August 27, 1998 by the Ontario Court of Appeal herald a tougher approach towards supervisory employees who engage in sexual harassment of subordinates. The decisions, both of which reversed lower court rulings in favour of the dismissed employees, hold that long-time supervisors with otherwise clean disciplinary records may be dismissed for cause where allegations against them of sexual harassment have been substantiated. The decisions also deliver a forceful message about management’s obligation to protect its employees from abuse.

BANNISTER: MANAGEMENT ENTITLED TO RELY ON SUPERVISORS TO IMPLEMENT ANTI-HARASSMENT POLICIES

In Bannister v. General Motors of Canada, the terminated employee was a supervisor in the security department of the company’s St. Catharines plant. In September 1990, a summer student who had just finished her employment filed a complaint against Bannister, alleging that he had placed his hand on her waist and attempted to obtain a kiss; suggested she take her clothes off so that he could see whether she had gained weight; made a variety of lewd remarks; and kissed her on the mouth during a Christmas party.

The student’s complaint led the company to conduct an investigation which turned up complaints from four other female employees. After interviewing some 40 employees, the company confronted Bannister with the allegations. He denied everything and countered that the women were conspiring against him. Management decided that it had no alternative but to terminate him for cause.

At trial, Bannister won his action for wrongful dismissal. The trial judge made no findings as between Bannister and the complainants about who was telling the truth, holding that even if everything the women employees had alleged were true, it still would not amount to just cause for dismissal. The judge concluded that the company’s anti-harassment policy was not enforced, and that Bannister’s behaviour was no worse than that of many others at the plant. He also found that Bannister had never persisted in his sexual advances once rebuffed, and held that this persistence was a major component of the definition of sexual harassment.

The Court of Appeal strongly disagreed with the trial judge, and expressed the view that his decision demonstrated “a complete lack of appreciation of the modern concept of equality of the sexes” and was replete with “catch phrases from another era”. The judge’s key error, the Court held, was overlooking Bannister’s responsibility as a supervisor to oversee conditions in his work area and provide an example of good conduct:

“[T]he trial judge … took no account of [Bannister’s] supervisory role in the department in respect to the alleged misconduct. It was clearly an error of omission to treat [Bannister] as if he was just one of many employees … who may have joined with others in improper conduct.”

The Court praised the company’s thorough investigation of the complaint against Bannister, and noted that employers who do so reduce the risk of eventually being held liable for the actions of their supervisory personnel. When Bannister responded to the allegations against him with a blanket denial, management, once it had determined that the complaints were substantiated, had no choice but to terminate him, lest it fail in its duty to protect employees from offensive conduct and the corporation from civil liability for Bannister’s actions.

The Court also rejected the judge’s views concerning the lack of persistence in Bannister’s conduct towards individual complainants. The fact that his conduct related to several employees on a variety of occasions was of potentially greater concern to the employer than persistent conduct directed towards one employee, as the latter was easier to isolate and control.

No one expects that offensive behaviour can be completely eliminated from the workplace, the Court noted, but management’s obligations require that supervisors be held to a higher standard:

“Management was entitled to have a supervisor who would do his best to assure that the environment was clear of … objectionable conduct. … Given the finding that [Bannister] joined in these activities without later apology or acknowledgement, it is hard to imagine an alternative to termination which would not perpetuate the harassment which management was obligated to eliminate.”

GONSALVES: EMPLOYER OBLIGED TO PROTECT WORKFORCE FROM HARASSMENT

In Gonsalves v. Catholic Church Extension Society of Canada, Gonsalves was a 59 year-old office manager who supervised ten female employees. He became infatuated with one of his subordinates, Ms. N, and started making inappropriate and suggestive comments to her both in private and in the presence of others. He hugged her on several occasions and once caressed her breast.

Gonsalves’ inappropriate behaviour ceased following an office reorganization that removed Ms. N from his direct authority. However, some seven months later, the full details of his conduct emerged and Gonsalves was confronted by management. Like Bannister, he denied everything and was terminated for cause. There was no policy on sexual harassment in effect at the time.

At trial, Gonsalves continued to deny the allegations, but acknowledged that they were serious, and stated that he required neither a warning nor a policy to inform him that such things were wrong. The trial judge, while finding that the allegations were true, held that Gonsalves had been wrongfully dismissed. In addition to citing Gonsalves’ age and lengthy service, the judge relied on the fact that the harassment had ended seven months before Gonsalves was dismissed, and he had received no warning that this sort of conduct would not be tolerated.

In allowing the appeal and upholding the termination, the Court of Appeal noted that Gonsalves himself had admitted that he needed no warning regarding the seriousness of sexual harassment. Moreover, the Court observed, the victim had given credible evidence that verbal intimidation and veiled threats continued after the sexual harassment itself had stopped. When Gonsalves denied any wrongdoing, the employer was left with little choice:

“This evidence [of the victim’s continuing distress] has obvious significance to the alternatives available to the employer when faced with a denial of apparently credible complaints. The employer has a duty to all the employees both to end the abuse and to alleviate its impact upon the employment environment. On the face of this evidence continued employment would have perpetuated Ms. N’s distress.”

Regarding the lack of a warning, the Court noted that Gonsalves’ misconduct included sexual assault, and with such manifestly inexcusable conduct, a warning may not be the most appropriate response. Further, the Court reiterated, Gonsalves’ denial of responsibility made a warning even more problematic:

“Once the employer is satisfied that the complaints are well-founded, the denial [limits the] choices open to the employer. There is no opening for an apology to clear the air if employment is to be continued. … Without some acknowledgement of fault and steps taken to reassure staff, it is my view that [the employer] could not responsibly have left this small group of female employees in the charge of Mr. Gonsalves, subject only to a warning.”

The Court acknowledged that terminating a long-term employee at an age where his re-employment prospects were bleak was a difficult task. However, it concluded, the employer’s duty to protect its employees from abuse took precedence:

“[P]ersons in a supervisory capacity must not, over time, permit their position of power to supplant good judgment and responsibility. When credible evidence stands against denial, the employer’s options may be limited and its obligations to the work force may have to supervene over the interests of an otherwise valued employee.”

In Our View

These two decisions do not absolve employers of the obligation to treat supervisory employees accused of harassment with fairness before taking action. In addition to conducting a thorough investigation, fairness requires that management turn its mind to whether there are less severe alternatives to termination. This will depend on the facts of each situation. In these two cases, the failure of the supervisors to admit to the allegations left the employers with little choice but to terminate.

For a discussion of the problems presented to employers by workplace harassment and some solutions, readers should refer to our article on this subject in the April 1998 issue of FOCUS. (See “Workplace Harassment: A legal minefield for employers” on our Publications page.) For more recent developments in the law of workplace sexual harassment, see “Court of Appeal upholds dismissal of executive director of “workplace infected by sexual harassment”” on our What’s New page.

For further information, please contact Lynn Harnden at (613) 563-7660, Extension 226.