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Major payroll typo fuels legal battle, human rights claim for sawmill’s receptionist/cleaner

by HR Law Canada

A request by Herwynen Sawmill in Guelph, Ont., to defer a human rights complaint has been dismissed by the Human Rights Tribunal of Ontario. It’s a complicated case involving a major payroll typo, a small claims court battle to get the money back, and a corresponding complaint of discrimination after the worker was fired shortly after contracting COVID-19.

Worker terminated after COVID-19 diagnosis

The applicant, an account payable receptionist who also performed evening cleaning duties, alleged that she was wrongfully terminated after contracting COVID-19 and requesting time off as recommended by her doctor.

She worked for Herwynen from Jan. 10, 2022, to Nov. 10, 2022. The employer, however, cited performance issues and workplace misconduct as the reasons for her termination, stating that the decision was made before they were aware of her medical condition.

Significant payroll error

A central element of the dispute involves a significant payment error. On Nov. 16, 2022, the employer mistakenly paid the applicant $21,925.24 instead of $2,192.24 as her final pay.

The applicant refused to return the excess amount, prompting the employer to initiate a Small Claims Court proceeding in Orangeville to recover the funds. This legal action, filed on Jan. 20, 2023, predates the applicant’s human rights complaint, which was submitted on March 23, 2023.

Allegations of discrimination and reprisal

The applicant’s human rights complaint includes allegations of discrimination based on disability, record of offences, and reprisal. She contends that her termination was influenced by her medical condition and the subsequent request for leave. The employer, however, maintains that the termination was unrelated to her health and was solely due to her job performance and conduct.

Tribunal’s decision on deferral request

The Tribunal’s interim decision focused on whether to defer the human rights application pending the outcome of the Orangeville Action.

The employer argued that the application and the defence in the Small Claims Court case were duplicative, constituting an abuse of process. The applicant opposed the deferral, asserting that the two matters dealt with different issues and that she did not seek financial compensation in the Orangeville Action.

Tribunal’s reasoning and conclusion

The Tribunal acknowledged the possibility of inconsistent decisions if proceedings dealing with the same issues run concurrently. However, it emphasized that deferral is not automatic and must consider factors such as the subject matter and nature of the other proceeding, the type of remedies available, and the overall fairness to the parties.

Based on the facts presented, the Tribunal determined that deferral was not warranted at this time. It noted that the Orangeville Action, initiated by the employer, focused on the repayment of mistakenly paid funds and did not clearly involve the discrimination allegations central to the human rights application.

The Tribunal stated, “It is not clear that the applicant is making a defence of set-off in the Orangeville Action. The Defence, as stated above, seems to revolve around a Record of Employment and how much is owed to the applicant if she was in fact wrongfully terminated.”

The Tribunal also addressed the employer’s concern about potential double recovery, suggesting that either the court or the Tribunal could consider damages awarded in the other proceeding when assessing appropriate damages.

Furthermore, it highlighted the uncertainty regarding the stage of the Orangeville Action and indicated that a fresh deferral request could be filed if new developments suggest duplication leading to inconsistent findings.

Next steps: mediation

As both parties agreed to mediation, the Tribunal directed the Registrar to schedule a mediation session for the human rights application. This move aims to facilitate a resolution and address the complex issues surrounding the case.

For more information, see Morris v. Herwynen Sawmill, 2024 HRTO 896 (CanLII).

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