A $27,000 settlement offer that was refused by a worker in a discrimination case was “fair and reasonable” in the circumstances, the Human Rights Tribunal of Alberta has ruled.
The ruling centred on compensation for lost wages and a claim of failure to accommodate, with the Tribunal ultimately siding with the Director’s earlier decision to dismiss the case.
The case involved a former heavy-duty equipment operator employed at an oil sands site who had filed a complaint against his former employer, alleging discrimination related to a medical condition. The complainant had developed allergies, including to bitumen dust present at the site, which led to his eventual termination.
At the core of the complaint was the argument that the employer had failed to accommodate his medical condition and wrongfully terminated him without offering appropriate alternatives.
Settlement offer
In its analysis, the Tribunal examined the settlement offer presented to the complainant, which included $27,000 in compensation for lost wages, equivalent to about 9.5 weeks of income. The complainant argued that this offer fell far short of what he was owed, asserting that he should be compensated from April 2020, when he first went on unpaid medical leave, until the present.
However, the Tribunal found that this claim was unsupported by the record. It noted that had the complainant succeeded at the hearing, he would have likely only been entitled to lost wages from the date of his termination until he found new employment, not for the entire period since he went on leave.
“If the complainant was wholly successful at hearing, he likely would only receive lost wages from the time of his termination to the time he obtained reasonable alternative employment,” the Tribunal stated in its ruling.
Worker mitigated damages
The Tribunal noted that the complainant had secured another job within four months of his termination, which was a key factor in reducing the amount of compensation he could claim.
“The complainant mitigated his damages, which was his responsibility to do, and therefore cannot claim damages for the period in which he had reasonable alternative employment,” the Tribunal stated. Under Alberta human rights law, individuals are required to mitigate their lost wages by seeking new employment, and in this case, the complainant had done so.
Further complicating the complainant’s case was his claim that the settlement offer did not account for the wages he believed he should have received prior to his termination, had the employer accommodated him between April 2020 and June 2021. The Tribunal disagreed, finding that the evidence did not support the likelihood of the complainant returning to work during that period. Despite the complainant’s assertions, the medical records and accommodation discussions between him and the employer indicated that returning to work during that timeframe would have been unlikely.
Risks of a full hearing
The Tribunal also reviewed the broader risks involved in proceeding to a full hearing. While cautioning against overstating any potential weaknesses in the case, the Tribunal acknowledged that the complainant faced significant challenges. The ruling highlighted that the complainant had previously expressed his unwillingness to transition to an office job, even though he acknowledged that he would have taken it if offered.
Additionally, medical evidence suggested that a complete industry change and retraining would be necessary for the complainant due to his allergies.
The Tribunal further noted that there was “considerably more risk to the complainant because the record reflects that the respondent may have reasonably accommodated the complainant to the point of undue hardship.” Employers are required to accommodate employees to the point of undue hardship, a standard that allows some flexibility based on the specific circumstances of each case.
A compromise, but reasonable
Given these factors, the Tribunal found that the settlement offer of 9.5 weeks’ pay, though a compromise, was reasonable. The Tribunal concluded that while the complainant could have potentially received more had he prevailed at the hearing, the settlement offer represented a fair outcome when considering the risks and merits of the case.
“Considering the settlement offer as a whole, including the amount for general damages, and the relative risks to the parties in proceeding, the offer of $27,000 in lost wages was reasonable in the circumstances,” the ruling stated. The Tribunal also acknowledged the “robust discussions” that had taken place between the parties during the conciliation process, adding that the complainant had ample opportunity to present arguments about the reasonableness of the settlement before the Director’s dismissal of the complaint.
In the final order, the Tribunal affirmed the Director’s decision to dismiss the complaint, concluding that the proposed settlement offer was both fair and reasonable under the circumstances. “I am satisfied that the complainant refused to accept a settlement proposal that was fair and reasonable,” the Tribunal wrote.
For more information, see Lambert v Canadian Natural Resources Limited, 2024 AHRC 105 (CanLII).
