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In the era of #metoo and #timesup, workplace harassment has become a hot-button issue for employers. Employees are increasingly becoming aware of their right to be free from harassment and other inappropriate behaviours in the workplace, which has led to an increased number of workplace harassment complaints and, consequently, a greater need for employers to investigate these complaints. In Ontario, employers are legally required under human rights and health and safety legislation to protect their employees from workplace harassment and respond appropriately when faced with a complaint or incident. Workplace investigations can be complex, and employers often struggle with what to do with an alleged harasser. In certain circumstances, it may be appropriate for an employer to suspend the alleged harasser pending the outcome of the investigation. Employers may employ an administrative suspension in such a circumstance for several reasons, including but not limited to: minimizing the disruptive impact the investigation has on business operations, preventing any further harm to the alleged victim, particularly where the alleged harasser is a direct supervisor of the victim, and maintaining the confidentiality of the alleged incident and the investigative process. Given that so many employers are dealing with this issue today, now is a good time to review some of the law regarding administrative suspensions during workplace investigations.

Generally, an employer will be entitled to place an employee on an administrative suspension where the employer has expressly reserved the right to do so in the employee’s employment contract. However, the Supreme Court of Canada (“SCC”) has confirmed that an employer has an implied right to suspend employees for administrative purposes, even where the right is not expressly stated in the employee’s employment contract. This implied right includes the right to suspend an employee pending the outcome of an investigation. In Cabiakman v Industrial Alliance Life Insurance Co [Cabiakman], the SCC stated that the power to suspend for administrative reasons stems from an employer’s right to manage its business and protect the interests of its business. Nevertheless, where an employer has not expressly reserved the right to do so, a decision to place an employee on administrative suspension must be reasonable and exercised in accordance with four requirements. These requirements are that:

  1. the suspension must be necessary to protect legitimate business interests;
  2. the employer must be guided by good faith and the duty to act fairly in deciding to impose an administrative suspension;
  3. the suspension must be imposed for a relatively short period that is or can be fixed; and
  4. the suspension must be paid, except in exceptional circumstances.

Despite the SCC’s confirmation that employers do have the right to suspend an employee for administrative purposes, claimants have challenged the legality of such suspensions.

In a 2016 case called Pierro v Hospital for Sick Children [Pierro], a prolific pediatric doctor sought an injunction from the Ontario Superior Court of Justice preventing his employer, the Hospital for Sick Children’s (“Hospital”), from suspending his administrative and supervisory duties pending the outcome of a workplace harassment investigation. The doctor argued that, because his employment contract did not explicitly provide the Hospital with the right to place him on an administrative suspension, the Hospital’s actions amounted to constructive dismissal. Dr. Pierro also argued that his reputation would suffer irreparable harm as a result of the investigation.

Background

In Pierro, Dr. Pierro was under investigation for a wide variety of complaints of workplace misconduct. These complaints included, among others, yelling and screaming at employees, bullying junior level staff, and threatening to fire staff for not doing what he wanted. However, the investigation into the complaints about Mr. Pierro’s behaviour proved challenging because a number of witnesses expressed reluctance to participate due to fear of retaliation by the Doctor. Because of these challenges, the Hospital decided to suspend Dr. Pierro from his administrative and leadership roles in the hospital in order to allow an independent investigator to gather evidence fairly and freely without interference. Dr. Pierro, would receive full pay during the suspension and he was still able to continue his clinical, research, and teaching roles. The intent of the suspension was to isolate the Doctor from the complainants in his working division.

The Decision

The Ontario Superior Court found that the Hospital had not constructively dismissed Dr. Pierro by suspending his administrative and supervisory responsibilities pending the outcome of the harassment investigation. Relying on Cabiakman, the Court found that the Hospital had the residual power to suspend Dr. Pierro because of the complaints against him, even though this right was not expressly reserved in his employment agreement. The Court stated that, in this case, all four requirements for an employer to validly suspend an employee for administrative purposes under its implied contractual power to do so as outlined in Cabiakman were met, and, therefore, the Hospital’s actions taken with respect to Mr. Pierro were legally justified.

The Court also made instructive comments about how alleged harm to the reputation of someone accused of harassment will be balanced with an employer’s legal obligation to investigate harassment complaints. The Court stated that, any damage to Dr. Pierro’s reputation would stem from the accusations of misconduct, and not the administrative suspension itself. In fact, the ability of the employer to conduct an independent investigation free from interference would be in Dr. Pierro’s best interests because any reputational damage would be mitigated if the investigation determined that the allegations were groundless. Therefore, given that internal investigations into bullying and harassment are not only desirable, but obligatory, the harm suffered by the Hospital if it was not able to suspend Dr. Pierro in order to conduct the investigation adequately would be much greater than any reputational harm that Dr. Pierro might suffer.

Key Takeaways

The decision in Pierro should serve as a signal to employers that the integrity of a workplace investigation will be strongly guarded by the courts and that employers may be justified in suspending alleged harassers during the course of a workplace investigation, even absent an express contractual term permitting them to do so. As long as a suspension during the course of an investigation is: (1) necessary to protect business interests, (2) guided by good faith and the duty to act fairly, (3) temporary in nature, and (4) paid, an employer has the power to take this action even if the employment agreement does not provide for it.

Notwithstanding an employer’s right to suspend absent an express right to do so, as a best practice, employers should make sure that they include an express term in their employment agreements that allows them to place employees on administrative suspension. Including such a provision will protect against potential constructive dismissal claims like in Pierro, as well as provide peace of mind that the employer’s right to suspend an employee during an investigation is contractually guaranteed.

For more information about workplace harassment and how the law has recently developed in this area, see the Spring 2019 Edition of In the Know.

This blog is provided as an information service and summary of workplace legal issues.

This information is not intended as legal advice.