by Rachel Ravary
McCarthy Tetrault

Last week’s decision in Hydro Québec v. Syndicat des employé-e-s de techniques professionnelles et de bureau d’Hydro-Québec 2008 SCC 43 is good news for employers – finally there is a clear limit to your duty to accommodate employees who are chronically absent from work.

Not only did the Supreme Court of Canada clarify just how far an employer must go to accommodate a disabled employee, it also confirmed that all of the efforts made by the employer in the months and years leading up to termination must be taken into consideration when looking at whether the point of “undue hardship” has been reached by the employer.

Background
The plaintiff, a unionized Hydro Québec employee, suffered from a number of physical and mental conditions that led her to be off work on a regular basis. In fact, the record showed a whopping 960 absences over the last seven and a half years!

Over the years, Hydro Québec had made efforts to accommodate her by allowing progressive returns to work after prolonged absences and giving her light duties. However, in July 2001, she had been absent for more than five months. She had no expected date of return and the company’s doctor was of the opinion that the risk of relapse was high. In other words, the future would mirror the past. On that basis, she was terminated.

The arbitrator dismissed her grievance on the grounds that the employee’s condition could not be accommodated without undue hardship. Hydro Québec had therefore satisfied its duty to accommodate her.

The Superior Court upheld the decision, but it was later overturned by the Québec Court of Appeal. In a decision that was extremely troubling for employers, the Court of Appeal said that, to justify the dismissal, Hydro Québec had to prove that it was impossible to accommodate the employee’s particular situation, which it did not do. The court also refused to consider the history of accommodation and said that the only relevant circumstances were those that existed as of the time the decision to terminate employment was made.

Supreme Court decision
The Supreme Court of Canada ruled that the Québec Court of Appeal was wrong on two counts: first, in setting too high a standard for assessing undue hardship and, second, by not looking at the entire history of the situation to determine whether the duty to accommodate was met.

First, the Supreme Court went back to the basics by reminding us of the true purpose of accommodation: to “ensure that persons who are otherwise fit to work are not unfairly excluded where working conditions can be adjusted without undue hardship.” This does not mean that disabled employees are relieved of their basic obligation to perform work, or that employers must go to outrageous lengths to fundamentally change the working conditions.

On that basis, the Supreme Court ruled that the employer is not required to show that it is impossible to accommodate the employee’s particular condition and limitations. Rather, employers have the obligation to adjust the workplace in a way that will enable the employee to do his or her work, provided it can be done without undue hardship. The Court gave examples such as allowing a variable work schedule, lightening duties, or even transferring the employee if it can be done reasonably.

If, despite the employer’s efforts, the business can’t operate properly or the employee remains unable to work for the reasonably foreseeable future, the employer will have satisfied its duty to accommodate and the dismissal will be deemed to be nondiscriminatory.

Finally, the Supreme Court confirmed that a decision to dismiss an employee in these circumstances must necessarily be based on an assessment of the entire situation, including the employee’s record of illness and everything the employer has done in the past to accommodate it.

Lessons learned
All in all, this decision goes a long way to circumscribing an employer’s duty to accommodate an employee who is unable to work because of illness. Canada’s highest court has now made it clear that the duty to accommodate doesn’t mean that employers are forced to live indefinitely with an employee who can’t satisfy the basic requirements of his or her position, or who would require drastic changes in working conditions to do so.

Employers can take this as a welcome sign that the voice of reason has finally weighed in on the debate over the duty to accommodate.

by Rachel Ravary and Philippe Lacoursière
McCarthy Tetrault

Earlier this year, we reported on the decision of the Alberta Court of Appeal in Chiasson v. Kellogg Brown & Root (see the January 22, 2008, blog entry titled Ruling helps Alberta employers defend preemployment testing challenges), which upheld an employer’s right to perform mandatory preemployment alcohol and drug screening for safety-sensitive positions.

But only a few weeks earlier, the Québec Court of Appeal had quietly ruled in Section locale 143 du Syndicat canadien des communications, de l’énergie et du papier v. Goodyear Canada Inc. that random alcohol and drug testing of employees working in safety-sensitive positions violated Québec’s Charter of Human Rights and Freedoms.

Facts
In June 2004, Goodyear adopted a “Policy regarding Alcohol Consumption and Use of Drugs and Medication” for its tire plant in Valleyfield, Québec. The union filed a grievance alleging that the policy violated the collective agreement, the Civil Code of Québec and the Charter.

In his award, arbitrator Denis Tremblay modified the policy slightly to make it one that he considered would be lawful. This “modified” policy provided for alcohol and drug testing by means of hair, urine, or breath analysis. The policy could be applied in any of these cases:

• to test job applicants and new employees;
• in situations where there was reasonable and probable cause to believe that an individual was under the influence of drugs and alcohol;
• following an accident in the workplace;
• in a random, unannounced manner for employees working in “high risk positions;” and finally
• after an employee had been absent because of alcohol consumption or drug use.

After the Québec Superior Court refused to overturn the arbitrator’s decision, the union brought the matter before the Court of Appeal.

The union did not contest Goodyear’s right to test employees when there was reasonable and probable cause to believe that they were working under the influence of either alcohol or drugs. However, it argued that the Superior Court judge wrongly held that random alcohol and drug testing is not an excessive invasion of privacy and other individual rights, even for safety-sensitive positions. In response, Goodyear argued that legitimate safety considerations justify the invasion of privacy, particularly for employees working in high-risk positions.

The Court of Appeal agreed with the union and allowed the appeal, striking down the clause in the modified policy that would have allowed random testing of employees in safety-sensitive positions. The court ruled that the policy did not meet the requirement that it minimally infringe on the employees’ privacy rights.

The Court of Appeal found that these tests did not prove that the employee was impaired but only pointed to consumption any time in the weeks preceding analysis of the sample. This method of random testing would therefore allow Goodyear to unreasonably intrude into the private lives of its employees.

Further, these samples could reveal other confidential information about employees’ state of health. Finally, the court noted that, despite Goodyear’s poor workplace accident record, no direct link could be drawn between this situation and the consumption of alcohol or drugs in the workplace.

What does this mean for employers?

1. As a general rule, random alcohol and drug testing for Québec employees working in safety-sensitive positions is prohibited.
2. The Court of Appeal arguably leaves open the possibility that random alcohol and drug testing may be justified if an employer can establish a direct link between a pattern of work-related accidents and alcohol or drug consumption in the workplace.
3. Given the recent contradictory decisions, it appears that – at least in Alberta, British Columbia, Ontario, and Québec – alcohol and drug testing of individuals in safety-sensitive or high-risk positions remains contentious and subject to challenge. For employers in Québec, it will now take very specific circumstances to get around the application of this Court of Appeal decision. Absent such circumstances, random alcohol and drug testing for employees working in safety-sensitive positions is prohibited in Québec.

By Tina Giesbrecht and Lana Jackson
McCarthy Tetrault

Employers often ask whether they should give employment references to employees and former employees. This decision can be a difficult one with possible negative consequences for either course of action. Whatever decision is made, it’s important to consistently apply one policy regarding reference letters.

Q. What are the consequences if an employer refuses to provide a letter of reference?

A. Many employers are hesitant to provide references because they fear potential defamation suits. However, recent Canadian case law indicates that in a wrongful dismissal lawsuit, refusing to provide a letter of reference may constitute an act of bad faith on the part of the employer, especially in cases where the employer has promised that a letter of reference would be provided or if an employer withholds a letter of reference as a negotiating tool in exchange for acceptance of a severance package. The result can be increased damages.

Q. What potential pitfalls arise if an employer decides to provide a reference?

A. If an employer decides to give a reference, it’s important to be aware of possible privacy issues, defamation lawsuits, and negligence lawsuits. These issues are discussed below.

Q. How does privacy legislation affect an employer’s ability to provide a reference?

A. Not all provinces have privacy laws that require private-sector employers to protect personal information. However, it’s important to understand that there is a growing privacy culture in Canada, and many former employees will expect employers to take special care with their personal information.

While consent may not be specifically required in all provinces, before providing a reference, it’s always best to err on the side of caution. Listed below are some tips on how to avoid disclosing too much information when asked to provide a reference and ways to obtain consent:

• Only disclose the information that was required to establish, manage, or terminate the employment relationship with the former employee.
• Make a reasonable effort to ensure the information provided is accurate and complete.
• When contacted to provide a reference, confirm with the former employee that he or she consents.
• Confirm the extent of the consent.
• If possible, at the time the employment relationship is terminated, seek to obtain consent from the outgoing employee regarding the employer’s scope as referee for potential employers. (Such consent can be in writing or the employer can note verbal consent in its own records.)

Q. Are employers still protected from defamation claims resulting from reference letters?

A. Generally, courts have found that references given by employers are protected by qualified privilege. The word “qualified,” however, indicates that the privilege is not absolute. If the remarks are made maliciously or exceed the scope of the privilege, qualified privilege may be lost.
The best advice is to ensure that all facts stated in the reference letter are correct and if negative statements are to be made, have a second manager sign off on it to help ensure accuracy and fairness.

Q. When providing references, can an employer be found liable under a claim other than defamation?

A. Yes. An employer can be found liable under an action for negligence. Essentially, the law states that if an employer provides a reference, even if not obligated to provide one, it has a duty of care to the former employee to exercise due care and skill in its preparation. If negative statements are made about an employee and they cause foreseeable economic harm, the reference provider can be liable.

Q. Can an employer be found liable for not obtaining a reference?

A. Yes. When hiring employees where the job carries a risk of harm to third parties, it’s important to check references. In one Ontario case, the court held a bar liable for not officially checking the background of two of the bouncers it employed. The two bouncers viciously beat a customer in the parking lot, causing him permanent brain damage and leaving him unable to manage his own affairs. The court noted that the references had not been properly checked by the bar.

by Kate McNeill, Kelly McDermott and Donovan Plomp
McCarthy Tetrault

On Friday, June 27, 2008, the Supreme Court of Canada (SCC) released its decision in Honda Canada Inc. v. Keays, reversing the largest award of punitive damages in a wrongful dismissal action in Canadian history. The decision is very favorable for employers.

Background
Kevin Keays was a long service Honda employee who was diagnosed with chronic fatigue syndrome in 1997. He returned to work after a period on long-term disability benefits. Honda exempted him from its attendance-related progressive discipline policy but required him to provide a medical note for each absence, which was not required of employees suffering “mainstream” illnesses.

Keays’ sporadic absences continued, and Honda hired Dr. B to assess Keays. Keays hired a lawyer, who wanted to clarify the purpose of the meeting with Dr. B. Honda refused to deal with Keays’ lawyer and made Keays subject to its attendance-related discipline policy. When he continued to refuse to meet with Dr. B without Honda clarifying the purpose of the meeting, Honda terminated his employment for insubordination. (more…)

by Barbara A. McIsaac, Helen Gray, and Daniel Pugen
McCarthy Tetrault

An employee’s expectation of privacy in the workplace is a big issue these days, especially with respect to the use of company computers.

Employers are often faced with questions like these: Is an employee entitled to privacy over e-mail and other data created and stored on a computer used for work or personal purposes? What rights does an employer have to access that information? The answer to these questions can depend on whether the employee has a reasonable expectation of privacy over the information stored on a given computer.

What is a reasonable expectation of privacy?
Two criteria must be established to show a reasonable expectation of privacy. First, an employee must subjectively expect some level of privacy, which is usually demonstrated through steps taken to protect the information in question, such as making a password or moving the data off company servers. Second, the employee’s expectation of privacy must be objectively reasonable.

Determining whether these criteria are present involves asking key questions such as:

• Who owns the physical equipment on which the data is stored?
• Has the data been transferred to the employer’s system or network?
• Does the employer have an Internet or computer policy that provides for employer access to information?
• How is the data arranged on the computer? Is employer data segregated from other material on the employee’s personal computer?
• Has the employee attempted to password-protect his or her computer and/or selected files?

Employer’s ownership of the computer
An employer’s ownership of a computer used by an employee for work purposes is strong evidence that an employee does not have a reasonable expectation of privacy over data stored on that computer or other data generated by personal use.

Several Canadian arbitrators have ruled that employees who use an employer system to send and receive e-mail messages and to post messages on discussion boards have no right to privacy. It has been held that an employee cannot expect to have any right of privacy when using the employer’s e-mail and Internet facilities.

Ownership is such a significant factor that in one case the arbitrator found that where a terminated employee had used the employer-owned laptop both at home and at work to access his Hotmail e-mail account, any reasonable expectation of privacy over his Hotmail e-mail account was trumped by the employer’s right to search its own property.

Employer policies
Another significant factor in determining if a reasonable expectation of privacy exists is whether the employer has a policy governing e-mail and Internet use. In one case, the existence of an employer’s policy against the use of the e-mail system for unacceptable purposes, and a clear “log-on warning” that the system would be monitored in accordance with the policy, was found to undermine an employee’s expectation of privacy.
Employee’s ownership of the computer

If the employee owns the computer personally but uses it for work purposes, does a reasonable expectation of privacy exist with respect to the data stored on that computer? In Canada, the answer to this question is unclear.

In the United States, certain decisions have favored an employer’s right of access where an expectation of privacy is not objectively reasonable. For example, there was no reasonable expectation of privacy over the files stored on an individual’s own laptop that had been connected to a military base network with a shared drive.

Similarly, there was no reasonable expectation of privacy over the information stored on an employee’s computer where an employee voluntarily brought his own computer to work to use for work purposes and took no steps to password-protect the data.

Lessons for employers
Many employers wish to monitor employee use of computers and networks for a variety of legitimate reasons, including preventing the collection and dissemination of improper/illegal material (e.g. pornography) and preventing employee theft of time associated with prolonged personal use of the Internet and e-mail.

Even though there is some uncertainty in the law in Canada, there are some simple steps that can be taken to help prevent employees from claiming a reasonable expectation of privacy:

• Employers should implement clear-cut and comprehensive policies governing their right to access data and systems. If an employer does not want an employee to have a reasonable expectation of privacy over any data found on a computer, then this should be clearly stated.
• Employees should be required to acknowledge that they have read, understood, and agree to abide by the policies.
• “Log-on” or “I Agree” statements and acknowledgements, which must be accepted before the computer or Internet can be used, can be a useful tool in this regard.
• Employers should also make clear that copies of employer-owned data remain the employer’s property regardless of where the data is stored.
• Finally, employers may manage employee privacy expectations over information stored on laptops by providing company laptops to employees for offsite work, so that, if necessary, the employer can justify a search of the computer (because of its ownership interest).