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PUNITIVE DAMAGES AWARDED IN CASES OF DISCRIMINATION

In a decision released this spring from an Ontario court, a large car manufacturer was ordered to pay a terminated employee $500,000 in punitive damages. While the decision will likely be appealed and, my guess is, that amount reduced, this case holds important lessons for all employers. An employer is obliged to treat an employee with good faith and to not discriminate against people who are disabled.
 
The employee had worked for the employer for 11 years when he was diagnosed with Chronic Fatigue Syndrome. He was off work for two years and receiving disability benefits but then eventually returned to work. When he started to miss work again, the employer demanded that he see the company physician for an examination to justify his absences. He agreed to do that. Given that he was facing progressive discipline as a result of his absences, he had little other choice.
 
The company doctor threatened to use his authority to move the employee from his regular job to the more physically demanding area of the production line which the employee feared would make his condition worse.
 
The employee’s absences continued at a higher rate than the employer expected and it asked him to see a second company doctor who had already reviewed the employee’s medical file. The employer told him that both doctors believed that the employee’s absences from work for medical reasons were unjustified.  The employee indicated that he would only agree to see the second company doctor, who he had apparently already decided he should be healthy enough to work regularly, if the employer provided clarification as to the purpose, methodology and parameters of the assessment the second doctor would do.
 
The employer refused to provide this information. The employee refused to go to the second doctor’s appointment. The employee was fired.
 
The employee sued for wrongful dismissal and punitive damages. The truth came out at trial. Neither doctor had ever come to a conclusion that the employee was able to work regularly. They had simply indicated that the medical file was incomplete. The employer had lied to the employee in an attempt to pressure him to work regularly or face termination.
 
The judge found that the company doctor used the “hard ball approach” and didn’t even seem to believe the Chronic Fatigue Syndrome was a real illness. Given these circumstances, the employee’s decision not to attend for the second doctor’s assessment was well-founded and did not justify his termination.
 
The court further found that the employee was subjected to patronizing scrutiny of his medical condition because he did not have a typical and mainstream medical problem. The employer had decided that Chronic Fatigue Syndrome was not really a legitimate medical excuse and tried to get a doctor’s note for each and every absence. They didn’t do that with people who had broken legs or heart surgery.
 
At the end of the day, the judge found that the employer simply did not want to accommodate the absences required by the employee’s unique illness and rather than honour their obligations under the Ontario Human Rights Code, used the employee’s refusal to attend at the second doctor’s appointment as an excuse for a termination.
 
The judge found that the employee was entitled to 15 months pay in lieu of reasonable notice but then increased that amount by another 9 months as a result of this bad faith treatment. The judge also found that the employer’s behaviour was so egregious that it should be punished so that the employer was not tempted to repeat it in the future. That’s when he awarded a half a million dollars in punitive damages. So far as I am aware, such an award has never been made in a wrongful dismissal case before in this country. Even though that amount may be reduced on appeal, the lesson for employers is this:  Treat every illness as legitimate and real. Many employers are suspicious of “stress leaves” and absences due to mental health issues. They can be as suspicious as they want, but if they allow that suspicion to affect how they behave or what they do, they can end up paying significant amounts of money.
 
Be frank and honest as far as humanly possible. The lies this employer told came back to haunt them in a big way.
 
 
As published in the Hamilton Spectator, July 23, 2005
 
Ed Canning
Ed Canning
P: 905.572.5809
ecanning@rossmcbride.com