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Former Alberta Energy worker, who refused $70,000 settlement offer, has human rights appeal dismissed

by HR Law Canada

An appeal by a former Alberta Energy employee, who declined a “fair and reasonable” $70,000 settlement offer, has been dismissed by the Alberta Human Rights Commission.

The worker, MK, filed two complaints. The first involved allegations of gender discrimination and mental disability discrimination. She claimed she was bullied, harassed (including sexually), and discriminated against during her employment.

The second complaint was twofold — alleging a failure to accommodate her mental disability and discrimination in the termination of her employment, where she argued her gender and mental disability were factors in the decision to terminate her.

But the Alberta Human Rights Commission upheld the Director’s initial decision, pointing out that the matters raised by MK had already been addressed through alternative dispute resolution mechanisms, including a comprehensive grievance process involving the Alberta Union of Public Employees (AUPE) and arbitration stages.

This process culminated in a settlement offer of $70,000 from Alberta Energy, which MK refused. “The complainant emphasized that the requirement to sign a non-disclosure agreement can never be fair or reasonable, and that the amount of money offered did not even cover her lost wages,” the ruling stated.

It was based on $30,000 for general damages for injury to dignity and $40,000 for lost income.

MK wanted a much higher amount claiming her “career has been destroyed,” the Commission said in the ruling. She sought a list of damages including:

  • $125,000 for harassment;
  • $20,000 for coercing her into providing medical records;
  • $15,000 for the cost of her move to Alberta;
  • $15,000 for having to cash in her RRSPs;
  • $60,000 for Charter violations;
  • $20,000 for the impact on her mental health;
  • $20,000 per year for 15 years to loss of earning capacity;
  • $200,000 in general damages; and
  • $500,000 in punitive and aggravated damages.

The Commission noted that Alberta Energy made the $70,000 offer before the Director had issued the initial ruling — noting the employer likely analyzed the risk of proceeding to a hearing and what it would cost even if it had won the case.

“At the time of the settlement offer, the Director had not yet made a decision as to whether the Complaints would be dismissed,” it said.

“There was a very real risk that the Complaints could be dismissed because they had been dealt with in a more appropriate forum,” the Commission said.

It noted that Alberta Energy provided a “credible” alternate explanation as to why MK’s employment was terminated.

“I find that the offer of settlement for lost income adequately addressed the risks of both parties with respect to the Complaints,” the Commission said. “I find that the respondent’s offer to settle the Complaints, with the information that was available at the time the offer was made, was fair and reasonable in all of the circumstances.”

Ultimately, the Alberta Human Rights Commission concluded that the first complaint was adequately addressed through the grievance procedure, meriting its dismissal.

The second complaint was dismissed because of MK’s failure to accept the settlement offer.

For more information, see Knauth v His Majesty the King in right of Alberta (Alberta Energy), 2024 AHRC 18 (CanLII).

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