BC Human Rights Tribunal Orders Record Damages Award of Over $1 Million to Terminated Employee Following Racial Discrimination

Author: Michael Weiler, KSW Lawyers (mweiler@ksw.bc.ca)

 

“Work is one of the most fundamental aspects in a person’s life, providing the individual with a means of financial support and, as importantly, a contributory role in society. A person’s employment is an essential component of his or her sense of identity, self-worth and emotional well-being”: [Reference re Public Service Employee Relations Act [1987] 1 SCR 313 quoted at paragraph 179 of Francis Remedy Decision infra.]

Introduction

Levan Francis was employed in a secure union position as a corrections officer since 1999.  He was athletic, healthy, a good father involved in his children’s lives and sport and a loving husband who was living the Canadian dream.  He had a passion for being involved in coaching. He had lots of friends and a loving supportive wife.  But all this changed in 2012.  Francis began 18 months of suffering racial discrimination that included direct explicit racial slurs from supervisors and fellow workers.  The BC Human Rights Tribunal (the “Tribunal”) described the instances of racial discrimination as covering the entire spectrum of racial discrimination and harassment.  He filed a Human Rights complaint on October 25 2012 after management failed to adequately respond to his complaints.  That resulted in retaliation by his fellow workers and supervisors.  The discrimination continued and on July 28 2013 Francis left work following an emotional breakdown resulting from the death of an inmate.  He did not return to work and has not been able to work since.  Six years later on July 4 2019 the Tribunal found that his employer and fellow workers had violated the BC Human Rights Code  (the “Code”) by discriminating against him contrary to section 13 of the Code based on his race and colour, which resulted in a toxic work environment and further had retaliated against him contrary to section 43 of the Code due to his filing his Complaint (referred to herein as “Contraventions”)  see Francis v BC Ministry of Justice No 3 2019 BCHRT 136 (the Liability Decision).  The particulars of the Contraventions and retaliation are found at paragraphs 371-379.

On January 28 2021 the Tribunal issued its decision on remedies: Francis v BC 2021 BCHRT 16 (Remedy Decision). Seven and a half years after his termination the Tribunal awarded Francis damages exceeding $1 million– a record award.

For those who want to review a leading decision on the nature of race discrimination and toxic work environment we recommend you read the Liability Decision.  This blog posting will review the Remedy Decision and the implications for employers.

The Remedy Award

A summary of the Award is as follows:

  1. $264,060 as compensation for past loss of earnings;
  2. $431,601 as compensation for future loss of earnings
  3. $65,881 as compensation for pension loss
  4. $25,515.24 plus $1140 as compensation for disbursements and expenses
  5. $176,000 as compensation for injury to his dignity, feelings and self-respect (injury to dignity)
  6. Interest

It should be noted that above awards included a 20% contingency reduction.  Further no award was made with respect to legal fees which Mr. Francis claimed were in excess of $250,000.

The Remedy Award is focused primarily on causation.  The losses and damages suffered by Francis and his wife and children were catastrophic.  At one point the Tribunal stated the impact “destroyed him as a human” (para 216).  The precedent setting awards of damages for future loss of earnings and injury to dignity reflect the extreme impact of the discrimination on Francis.

(a) Contingency Reduction

A complainant is only compensated for losses that result solely from the discrimination. This is different than proving the discrimination in the first instance where a complainant simply has to prove that discrimination played a role in the termination or adverse impact (the taint theory). The Tribunal has the authority to reduce any award for contingencies to account for the fact that the harm suffered as a result of the acts of discrimination including creating a toxic work environment may have been suffered in any event due to other non-discriminatory causes or unrelated events—“A respondent is not required to compensate a complainant for any harms that a complainant would have experienced anyway” (para 92).

In this case the Tribunal concluded that there would be no reduction of damages for mitigation.  However Francis suffered from the disputes over his disability payments and the litigation process itself both of which “intervening events [were] not sufficiently related to the Contraventions to justify compensation.” (para 95).  Although a very arbitrary calculation, the Tribunal applied a 20% reduction across the board to the monetary awards.

At the same time the Tribunal made it clear that damages for future losses were not too remote.  It applied the “thin skull” or “eggshell skull” analysis to assess damages:

In Francis’ circumstances, there can be no question that, given the duration and severity of the Contraventions and the resulting poisoned work environment that flowed from those Contraventions, it is reasonably foreseeable that a person of ordinary fortitude would have suffered a significant mental injury from the Respondent’s discriminatory acts. That Francis may have suffered greater mental injury than others in his circumstances is immaterial. The Respondent must take their victim as they find him and compensate him for the actual harm caused by their discriminatory conduct (para 98).

(b) Past Wage Loss

The Tribunal had two expert evidence reports before it that spoke to the issue of past and future wage loss.  It chose a Report that assessed past wage loss calculated as the difference between Francis’ actual income from July 2013 to November 20 2020 and what Francis would have earned had he remained actively employed.  It is not clear from the Award what the specifics of the calculations were (for example not clear if LTD payments were taken into account—LTD benefits appear to have been cut off in February 2018) but the end result was the Report’s conclusion that the past income loss was $236,939 net of taxes and including interest (para 119).

From that amount the Tribunal deducted $22,000 as STIPP benefits from March to September 2014.  It also grossed up the Award to calculate Gross Income of $293,947 plus it added $58,128 as income taxes payable as a result of receiving the wage loss as a lump sum.  Therefore the past wage loss was calculated at $352,075 with a net loss after deduction of STIPP benefits of $330,075.  Applying the 20% contingency the compensation for past wage losses was $264,060.  

(c) Future Loss of Earnings

The Tribunal recognized that assessing future loss of earnings that are related solely to the Contraventions is speculative.   Because the award is made “once and for all” at the time of the decision, the Tribunal must “peer into the future” and “fix the damages as best they can”. Therefore such awards are only made in the extreme and extraordinary circumstances.  Here after 6 years Francis was still “deemed to be unable to work in any capacity and his prognosis for recovery [was] guarded” (para 125).  Accordingly the “extraordinary circumstances of this case warrant a future loss of earnings award” (para 140).

The Tribunal then had to consider the likely retirement age for Francis.  It ultimately concluded he would have worked until age 63 which happened to be the conclusion of the expert in the Report.  The future loss of earnings was calculated in the Report as $539,501 based on retirement at age 63 and given the contingency  reduction of 20% the future loss of earnings was calculated at $431,601.

(d) Pension

There is no real analysis of the pension loss in the Award.  Relying on the Report pension loss to age 63 was calculated at $82,351 and after applying the 20% contingency reduction the award was $65,881.

(e) Expenses and Disbursements

Francis sought $250,000 for legal fees.  The Tribunal ruled it did not have the authority to award legal fees.  It awarded a small amount for therapy.

Frances was awarded compensation for expert reports, witness fees and related disbursements in the amount of $31,894.05 and after accounting for the 20% reduction the net award was $25,515.24.

(f) Injury to Dignity, Feelings and Self-Respect

This award is what makes this case a landmark decision that will affect future cases in a very significant way.  The Tribunal has authority under section 37(2)(d)(iii) of the Code to award damages to compensate a complainant who has been discriminated against  for injury to their dignity, feelings and self-respect “or to any of them” (para 153).  There is no cap on these damage awards and the decision lies solely in the discretion of the Tribunal.  The Tribunal summarized the law in this area at paragraphs 154 and 155 as follows:

[154] This discretion, however, must be exercised on a principled basis. The purpose of an injury to dignity award is to compensate the complainant for the actual harm they have suffered as a result of the discrimination: Kelly Appeal, at paras. 60-62. This assessment is based on the evidence before the Tribunal and all of the relevant circumstances of the case:

The Tribunal has frequently stated that injury to dignity awards are compensatory, not punitive, and should place the complainant in the position they would have been in absent the discrimination. But what does that mean in the context of a non-pecuniary award? The fixing of a monetary amount to compensate for the impact of discrimination on a complainant’s dignity, feelings and self-respect is highly contextual and fact-specific (Gichuru, para. 256)

[155] A number of factors may be relevant to the quantification of such an award. The Tribunal generally considers three broad factors: the nature of the discrimination, the person’s vulnerability, and the effect of the discrimination on that person: Basic v. Esquimalt Denture Clinic and another, 2020 BCHRT 138, para. 193. A more nuanced approach is necessary in the circumstances of this case. I will consider five factors set out by the Tribunal in Gichuru that can and have been applied to assist in the quantification of an injury to dignity award in these kinds of cases:

  • the nature of the discrimination found;
  • the time period and frequency of the discrimination;
  • the vulnerability of the complainant;
  • the impact of the discrimination upon the complainant; and
  • the totality of the relationship between the parties (at para. 260; cited with approval in Gichuru Appeal, at paras. 53-56.).

The highest ever award up to this point in B.C. was $75,000 for a “complex and multi-year discrimination involving a medical resident with a mental disability: Kelly v UBC 2013 BCHRT 30.

The Tribunal rejected the argument that the damages under this heading are limited to those that are reasonably foreseeable.  Rather the damages are to compensate for the actual harm to the victim.

The Tribunal assessed the 5 Gichuru factors above at paragraphs 158 through 218 (which reasons are well worth reading in their entirety and found: 

In all of the circumstances, I find that an award of $220,000 is reasonably proportionate to the extreme injury to dignity, feelings and self-respect suffered by Francis. Accounting for a 20% contingency, I order $176,000 as damages for injury to dignity under s. 37(2)(d)(iii) of the Code.

Takeaways for Employers

As early as 1837 jurists and lawyers have opined that “hard cases make bad law” and it has been noted that “cases in which the moral indignation of the judge is aroused frequently make bad law.”  Whether Francis will be considered bad law, employers and businesses must be very concerned with the trend in recent Human Rights cases to award damages and the potential impact on employers.

It was not that long ago that awards for compensation for injury to dignity were capped and after the cap was removed the awards were initially in the $3,000 to $5,000 range and escalated from that point on:  B.C. HUMAN RIGHTS TRIBUNAL DOUBLES CAP FOR DAMAGES FOR HURT FEELINGS TO $75,000 (weilerlaw.ca).

The Tribunal’s decisions in this case on both future wage loss and compensation for injury to dignity are extraordinary decisions.  But the same was said of the Kelly decision when the Tribunal awarded a record setting $75,000 for damages for injury to dignity noting that was an extraordinary situation.  The Francis case triples the amount of that award.  The question is will that mean an ever increasing amount of compensation for such claims?  Will a rising tide raise all ships?  I think that is more than likely.  Since damages for injury to dignity and future loss of income are very specific to the employee complainant and rely on the discretion of the adjudicator there is no limiting framework to keep these awards from becoming the norm and not the exception.  And consider specifically the impact of COVID on the mental health of all employees and the consequent increase in damages to an employee who is discriminated against.

For businesses that is a scary proposition especially when you consider the additional costs to the employer to defend one of these cases.  In this case Mr. Francis was looking for $250,000 reimbursement for legal fees on a case where he retained counsel well after the complaint had been filed.  Many of these cases work their way through the courts resulting in even greater legal fees (e.g. see B.C. COURT OF APPEAL RESTORES $75,000 AWARD FOR INJURY TO DIGNITY – UBC v Kelly 2016 BCCA 271 (weilerlaw.ca)

It is most noteworthy in my view that many of these leading human rights cases involve public employers and these damage awards are paid by you and me as taxpayers.  The leading case that expanded exponentially the Duty to Accommodate involved the NDP government as the employer whose accommodation of a fire fighter was found to have violated the Code:  BCGEU v BC [1999] 3 SCR 3 (“Meiorin”); Gichuru was a claim against the Law Society; Kelly was a claim against UBC.  But if the principles established in these cases are applied to small and medium sized private businesses the impact can be devastating especially in this COVID world.  The bar doesn’t just rise for public employers it applies to all employers.

The difficulty for all employers is that a violation of the Code does NOT require an intention to violate the Code.  In many of these cases the employer is bound by the unauthorized acts of its employees and cannot shield itself from liability based on a due diligence basis.   Obviously the Government in Francis qua employer could well have taken steps to resolve the complaints of Francis but it failed to do so.  But the precedent created by the Remedy decision in this case will apply to all employers where there has been a finding of a contravention of the Code.

Further the damage award here was exasperated in part by the extraordinary delay in the proceedings.  Here there was a 7 year delay; in Kelly there was a 6 year gap from the time he was terminated from the program to the Tribunal’s Award which as noted was appealed to the B C Court of Appeal.  The experts opined in the Francis decision that the longer you suffer from depression the worse the prognosis (para 130).

Finally awards for damages for injury to dignity are likely tax free so are often worth double what an award for lost wages would be.  While this allows employers to strike lower cost settlements it also encourages complainants to pursue complaints even where there is little or no wage loss.

There is in my view no likelihood that the NDP government will put a cap on damages for compensation for injury to dignity awards.  The Francis case will likely remain the rare exception to damage awards.  But there is little doubt the bar has been raised.  Employers must therefore do all they can to eliminate discrimination in the workplace and the early resolution of such claims.  This starts in my view with the education of the management team including the Human Resource professionals and the implementation or proper policies in this regard.  I encourage all our employer clients to speak to someone in our Employment and Labour Group if you have any questions about your policies.

Note to Readers: This is not legal advice. If you are looking for legal advice in relation to a particular matter or drafting of workplace vaccination policy, please contact Mike Weiler at mweiler@ksw.bc.ca.

Mike Weiler is senior counsel with the Employment & Labour Group at KSW Lawyers (Kane Shannon Weiler LLP). Mike specializes in labour law and helping unionized employers, and has more than 35 years of experience practicing employment, labour and human rights law, and related areas, including governance and shareholders rights (and corporate defences to same). He represents employers, management, executives and other senior employees.

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