Ontario Decision Makers Decide in Favour of Employers in Recent Vaccination Policy Decisions
Employers with ongoing vaccination litigation will be relieved to hear of two recently released decisions in favour of employers. These decisions relate to termination entitlement claims made by employees who did not comply with vaccination policies. The cases discussed are the Ontario Superior Court of Justice decision of Croke v VuPoint Systems Ltd, 2023 ONSC 1234 and the Ontario Labour Relations Board Decision of Atlantic Coated Papers Ltd v Cote, 2023 CanLII 42158 (ON LRB).
Croke v VuPoint Systems Ltd
Croke is a helpful decision for employers who were required to introduce mandatory vaccination policies as a result of third parties (such as clients) requiring their employees be vaccinated. Following Croke, employers have a strong argument that in such cases, refusal to become vaccinated can result in the frustration of the employment contract.
Mr. Croke was an employee of VuPoint Systems Ltd. (“VuPoint”). VuPoint provides satellite television and smart home installation services. The majority of their services are provided on behalf of Bell Canada and Bell ExpressVu (together “Bell”).
During the COVID-19 pandemic, Bell announced a vaccination policy for its vendors and contractors, which applied to VuPoint. The policy required all subcontractors or agents who interact with Bell customers be vaccinated against COVID-19. Non-compliance with this policy was stipulated to be a material breach of the supply agreement.
To comply with Bell’s policy, VuPoint implemented a vaccination policy, requiring VuPoint employees to provide proof of vaccination. Mr. Croke did not comply with the policy. As a result, Mr. Croke could not work on installations for Bell customers.
VuPoint did not have any other work for Mr. Croke. VuPoint treated Mr. Croke’s employment contract as frustrated and provided Mr. Croke with his termination entitlements pursuant to the Canada Labour Code.
Mr. Croke commenced a wrongful dismissal action. He sought damages related to common law notice, as well as aggravated, punitive and moral damages.
VuPoint argued that Mr. Croke’s employment contract was frustrated because he did not provide the company with information related to his vaccination status, and therefore he was not entitled to any damages.
Result & Takeaways
The Court determined that the contract was frustrated and Mr. Croke was not entitled to the damages sought. The key findings of the Court in making this determination were (i) Bell’s vaccination policy meant that Mr. Croke could not work for VuPoint unless he was vaccinated, (ii) the employment relationship was altered by unforeseen circumstances which were not contemplated at the start of the employment relationship, and (iii) this change was not the fault of either party.
For employers with ongoing vaccination litigation, Croke can be a useful negotiating tool to leverage. Croke has the potential to be more broadly applied, particularly for businesses that had significant risk of COVID-19 outbreaks. Whether a court would find frustration where it is the employer’s policy rather than a third party policy mandating vaccination is yet to be seen, but this decision is definitely persuasive.
Atlantic Coated Papers Ltd v Cote
The Ontario Labour Relations Board (“OLRB”) allowed Atlantic Coated Papers’ appeal of an Employment Standards Officer’s order to pay statutory severance pay to an employee constructively dismissed in relation to a vaccination policy. This case is added to a series of decisions favouring employers who took action via mandatory vaccination policies to protect employees from COVID-19.
Atlantic Coated Papers advised employees on October 12, 2021 that as of December 6, 2021 employees must be vaccinated or provide proof of a valid exemption. Ms. Cote did not comply with the policy. Atlantic Coated Papers offered Ms. Cote an independent contractor position where she could work from home. Ms. Cote rejected this opportunity and provided 9 days’ notice of her resignation on November 15, 2021, with a resignation date of November 26, 2021.
The Employment Standards Officer found the employer’s notice of the implementation policy provided sufficient notice of termination pursuant to the Employment Standards Act, 2000 (the “ESA”). However, the Employment Standards Office found Ms. Cote was entitled to statutory severance, and ordered the employer to pay $23,579.47 on account of statutory severance and a 10% administration fee.
The employer appealed the decision, arguing that Ms. Cote was not entitled to statutory severance as she had not complied with subsection 63(1)(e) of the ESA.
Result & Takeaways
The OLRB determined that when the employee rejected the independent contractor position and resigned, the employee was constructively dismissed. The OLRB also found that both the notice and severance provisions of the ESA are triggered in cases of constructive dismissal. However, the OLRB granted the employer’s appeal and determined that the employee was not entitled to severance pay as the employee had not complied with subsection 63(1)(e) of the ESA, which states as follows:
63 (1) An employer severs the employment of an employee if,
(e) the employer gives the employee notice of termination in accordance with section 57 or 58, the employee gives the employer written notice at least two weeks before resigning and the employee’s notice of resignation is to take effect during the statutory notice period. 2000, c. 41, s. 63 (1); 2002, c. 18, Sched. J, s. 3 (24).
Ms. Cote failed to give the two weeks of notice required pursuant to subsection 63(1)(e) of the ESA, and therefore was not entitled to statutory severance pay.
While this case has unique facts and is limited in its application to statutory entitlements, it continues a line of case law finding for employers in vaccination policy decisions.
If you have any questions regarding the impact of the discussed decisions, please do not hesitate to contact a member of our Labour & Employment team.