Canadian Pacific Kansas City Railway (CPKC) has been ordered to pay $20,000 in damages to a conductor after failing to comply with a reinstatement order for more than two years, imposing unauthorized barriers to his return, and denying him access to critical health benefits.
The arbitrator ruled that CPKC discriminated against W.C. by refusing to reinstate him despite a December 2022 statutory decision ordering his return to work with full compensation.
“CPKC’s imposition of the SAP requirement created an unreasonable barrier blocking (his) reinstatement. CPKC’s actions violated the plain wording of the SDO,” wrote the arbitrator, referring to the railway’s insistence that the conductor undergo a Substance Abuse Professional assessment before returning to work.
The case highlights the significant consequences employers face when failing to respect arbitration orders, especially when their actions exacerbate an employee’s disability-related conditions.
Background to the dispute
The case began in November 2020 when CPKC terminated W.C.’s employment for allegedly violating the company’s Alcohol and Drug Policy. The termination followed an anonymous tip about the conductor’s alleged marijuana consumption.
In December 2022, the arbitrator ruled in the original case (AH807) that the railway “had no reasonable grounds to test (him)” based solely on an anonymous tip. The arbitrator ordered the railway to reinstate W.C. “to his position with no loss of seniority and full compensation for all lost wages and benefits.”
Despite this order and despite W.C. testing negative on a substance screening test shortly after the decision, CPKC refused to reinstate him unless he agreed to undergo an SAP assessment. The railway maintained that W.C. had refused to cooperate with this requirement and eventually closed his reinstatement file.
Key issues determined
The arbitrator addressed three key issues in this supplemental decision:
- Whether CPKC was entitled to deduct 40% from W.C.’s compensation for the period January-May 2023
- Whether CPKC failed to respect the original reinstatement order from May 2023 onward
- Whether damages should be awarded
On the first issue, the arbitrator found that CPKC had “no legal basis to deduct 40% from the compensation owing” for the period in question. The arbitrator noted that “no legal presumption exists that an employer can withhold 40% of the compensation owing under an SDO unless the employee demonstrates he could not mitigate his losses.”
Railway’s failure to comply with reinstatement order
The arbitrator determined that CPKC failed to respect the original reinstatement order by imposing additional conditions not included in the original decision. While CPKC argued that the SAP assessment was required to ensure W.C.’s fitness for duty in a safety-critical position, the arbitrator found this requirement constituted an unreasonable barrier.
The ruling highlighted several troubling aspects of the railway’s conduct:
- CPKC insisted on the SAP requirement despite W.C. passing a substance test in December 2022
- The railway disregarded medical reports from W.C.’s doctors confirming he had no substance abuse issues
- CPKC denied W.C. access to health benefits and weekly indemnity benefits during this period
- The railway’s actions exacerbated W.C.’s major depressive disorder
“The arbitrator has concluded that the SAP constituted an unreasonable barrier CPKC put in place which has delayed (his) reinstatement,” the decision stated.
Human rights discrimination findings
The arbitrator determined that CPKC’s actions constituted discrimination under the Canadian Human Rights Act (CHRA). The arbitrator applied the three-part test for prima facie discrimination:
- W.C. had CHRA-protected characteristics (disabilities) including major depressive disorder
- He suffered adverse impacts in employment by being denied reinstatement and benefits
- His disabilities were a factor in CPKC’s refusal to reinstate him
“CPKC’s discriminatory conduct, given the overall context and the well-known jurisprudence under the CHRA, justifies a damages award,” concluded the arbitrator.
Damages awarded
The arbitrator awarded two types of damages under the CHRA:
- $10,000 in “pain and suffering” damages under section 53(2)(e)
- $10,000 in “special compensation” damages under section 53(3)
The “pain and suffering” damages were awarded based on the seriousness of CPKC’s conduct and its impact on W.C., including financial difficulties and worsening medical conditions.
The “special compensation” damages were justified because CPKC “acted recklessly when it ignored the SDO in AH807 and unilaterally imposed the SAP barrier.” The arbitrator noted that this reckless behavior resulted in worsening health conditions and severe financial issues for W.C.
Comprehensive remedy ordered
Beyond the damages award, the arbitrator ordered CPKC to:
- Immediately reinstate W.C. to his position “on paper” with access to all collective agreement entitlements
- Pay the improperly withheld 40% compensation with interest
- Begin the duty to accommodate process if required by current medical evidence
- Compensate W.C. for any lost benefits
- Pay compensation equivalent to the weekly indemnity benefits rate from May 2023 until his return to his position or to a reasonably accommodated position
For more information, see Teamsters Canada Rail Conference v Canadian Pacific Kansas City Railway, 2025 CanLII 32982 (CA LA).
