CN Rail had no cause to fire manager who allegedly failed to respond to complaints of sexual harassment: Manitoba court

A CN Rail train rolling down the tracks. Photo: Chris Robert/Unsplash

A former manager at CN Rail, fired for allegedly failing to adequately respond to complaints of sexual harassment, has been awarded 24 months’ notice after a Manitoba court ruled he had been wrongfully dismissed.

The Court of King’s Bench of Manitoba had blistering words for the employer, criticizing it for the decision to fire the manager, noting that it couldn’t “even prove that the persons responsible for the decision to terminate” even bothered to read the investigative reports into the incident.

The worker, SK, held the position of senior material supervisor. He was 61 at the time of termination and had been with the company for 34 years. He had a clean disciplinary record.

He faced accusations stemming from an incident involving a female employee and a male co-worker, both of whom reported directly to him. He was not directly involved in the incident, and did not see the interactions.

A senior manager at CN told SK that there was nothing more he could say about the incident, because the complaint was confidential, it was up to HR to solve the issue, and no action was required by him. SK wasn’t given any guidance about how to manage the dynamics of the workplace given the fact the complainant and the accused were still on the job and part of the same team he was supervising.

A workplace investigation resulted in two reports. These reports, while not recommending termination, found the complainant credible and SK not, citing failures to intervene in inappropriate workplace behavior and threatening the complainant. Based on these findings, CN terminated SK, justifying the decision with a breach of duty of good faith and failure to adhere to safe work policies.

The senior manager later expressed through an affidavit that the termination was unfair and not a decision he would have made. SK was, in his opinion, a dedicated employee who always acted professionally. He also noted that the department headed by SK was a workplace where many employees frequently used foul language and vulgar remarks.

Summary judgement

The case unfolded as the court permitted SK to bring a motion for summary judgment on the question of liability and damages, pre-empting a full trial. CN Rail contested this motion, arguing that the intricacies of the case, particularly those involving assessments of credibility, necessitated a traditional trial.

However, CN Rail’s position was weakened by its inability to present firsthand evidence or recollections from any employees involved in the decision-making process of SK’s termination. The evidence showed that the termination letter was issued following orders from a higher authority within CN, despite disagreements with the decision’s merit.

“The evidence presented by CN in opposition to the motion for summary judgment does not persuade me that CN had just cause to terminate the Plaintiff’s employment without notice based on the knowledge it acquired prior to termination or facts discovered afterwards,” the court said.

The judgment meticulously dissected CN’s justifications for the dismissal, including the lack of substantiated evidence linking him directly to the allegations of misconduct that were used to justify his termination.

SK’s defense highlighted a stark absence of due process in his dismissal, noting the peculiar circumstances under which CN failed to provide concrete evidence or records explaining the rationale behind its decision. This absence of transparency and accountability in CN’s decision-making process was critically viewed by the court.

The court underscored the principle that employers must conduct a thorough and fair contextual analysis before deciding on termination without notice. This includes considering the nature of the alleged misconduct, the employee’s service record, and the proportionality of the employer’s response.

“On the facts before me, I am left with no other conclusion than that CN took the most extreme option open to it (termination without notice) without being able to explain why this was proportional to the severity of the alleged misconduct. The Reports themselves do not recommend a sanction for what the Plaintiff apparently did.”

-Court of King’s Bench of Manitoba

It was also critical of the fact that CN was not able to offer any evidence that any of its management employees involved in the decision to terminate SK actually read the reports.

Reasonable notice

The court awarded SK the equivalent of 24 months’ pay, totaling $202,197.12, reflecting his long-term service, senior position, and the challenges he would face in securing comparable employment given his age and specific circumstances.

Mitigation

CN argued that SK failed to mitigate his damages, noting that he accepted an option it gave him to elect an early retirement benefit effective the date of termination rather than waiting until he turned 65.

Second, it argued that he failed to make a determined effort to find another job. The court balked at that argument.

“It is fundamentally unfair for CN to argue that the Plaintiff made a ‘decision to retire‘ in these circumstances,” it said.

“Due to the unjust conduct of CN in terminating his long-term employment without notice, the Plaintiff was faced with a difficult dilemma because he had no reasonable prospects of finding employment that would pay him substantially the same wages, benefits and bonus structure as he had enjoyed at CN.”

Given his age, education, and experience it would have been “extremely unlikely” that SK could have found a job that would pay him $100,000 a year, it said.

“It is unlikely in my view that the Plaintiff would have managed to find employment paying more than minimum wage ever again,” the court said.

It refused to clawback the notice period for failure to mitigate.

Aggravated damages

SK also sought aggravated, or Wallace, damages resulting from the unduly insensitive manner in which he was dismissed.

He argued that the company knew that his wife had died eight months earlier and that he was grieving when he was fired. He was diagnosed with depression and anxiety after his wife died, and these symptoms were made worse by his termination.

The court, however, dismissed the claim for aggravated damages, finding that while he undoubtedly experienced distress from his dismissal, it did not exceed the normal upset and distress that accompany such circumstances.

“There was nothing in the manner of his dismissal that would lead me to conclude that CN was making an effort to publicly humiliate or embarrass the Plaintiff or somehow rub salt into his wounds,” the court said. “The upset and distress the Plaintiff experienced does not rise above the normal feelings of upset and distress that typically accompany the termination of employment.”

For costs, it left it to the parties to agree — offering to help settle the issue if necessary.

For more information, see Kozar v. The Canadian National Railway Company, 2024 MBKB 12 (CanLII).

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