HUMAN RIGHTS TRIBUNAL OF ONTARIO
B E T W E E N:
Krystie Assivero
Applicant
-and-
1693238 Ontario Inc. O/A Spyce Spa & Hair Studio, Debra Board and Maribeth Ryckman
Respondents
DECISION
Adjudicator: Geneviève Debané
Indexed as: Assivero v. 1693238 Ontario Inc.
APPEARANCES
Krystie Assivero, Applicant
Self-represented
1693238 Ontario Inc. O/A Spyce Spa & Hair Studio, Debra Board and Maribeth Ryckman, Respondents
Marianne Craig, Counsel
Introduction
1This is an Application filed on September 20, 2011, under section 34 of Part IV of the Human Rights Code, R.S.O. 1990, c. H.19, as amended (the “Code”), alleging discrimination with respect to employment because of race, colour, ethnic origin and reprisal.
2The Application alleges that the applicant raised a human rights complaint with her employer 1693238 Ontario Inc. O/A Spyce Spa & Hair Studio (“Spyce Spa”) and that as a result her employment was terminated on June 7, 2011.
3On December 13, 2011, the Respondents filed a common Response, seeking the dismissal of the Application on the basis that the applicant had signed a Full and Final Release on June 7, 2011 (the “Release”).
4An in-person preliminary hearing was held on August 7, 2012 to determine if the Tribunal should dismiss the Application because the applicant executed the Release (the “preliminary issue”).
Background
5The respondents in their submissions dated June 7, 2011, raise the issue that the applicant was not entitled to termination payments because Spyce Spa had sufficient cause to terminate the applicant’s employment. However, the issue of just cause is not relevant to the preliminary issue and I have not addressed it in this decision.
6The following facts are not in dispute between the parties. On May 27, 2011, the applicant raised a human rights concern with Debra Board, the owner and President, about an allegedly discriminatory comment which was made in her presence. Ms. Board was away on vacation out of town for the next week and she returned to work on June 6, 2012. On June 6, 2012, the Ministry of Labour attended the workplace because the applicant filed a complaint with respect to a telephone exchange that occurred with Ms. Board while she was on vacation. On June 7, 2012, the applicant’s employment was terminated during a meeting in which the applicant signed the Release.
The Evidence
7The Tribunal heard the evidence of a number of witnesses: the applicant; Maribeth Ryckman, the respondent’s Operation manager; Deanna VanCasteren, the respondent’s Bookkeeper; and Debra Board, the owner of the respondent. All of these individuals were present at the applicant’s termination meeting.
8The applicant testified that she attended a meeting with her employer in which she thought there would be a discussion with respect to the human rights issue that she had raised. During the meeting a number concerns were raised by the respondents with respect to certain events that had occurred during Ms. Board’s vacation. She testified that at some point, she got up to leave the meeting because they had hit a “brick wall”. She was told to sit down and that in fact her employment was being terminated. She said that Ms. Ryckman passed over to her a copy of the termination letter and the Release, which states:
This letter will confirm our meeting today in which I advised you that your employment with Spyce Spa & Hair Studio will be terminated effective June 7, 2011 for reasons discussed.
Please accept my thanks for your efforts and contribution to the Company. In recognition of your service, we are prepared to offer you the following severance arrangements.
The Company will provide you with a lump sum payment of two weeks pay and 4% vacation pay in the gross amount of, $888.71, less applicable statutory deductions as required by law.
Any payment for services rendered in the current payroll period and any vacation pay owing for vacation which you have not yet taken will be provided to you, less statutory deductions as required by law, at the completion of the next pay period. The current pay period being May 28 to June 10th, including year to date retail sales. The total net being $753.08.
The proposed severance arrangements are in lieu of notice of termination and/or severance pay under applicable employment standards or other legislation, or at common law, and are in full and final satisfaction of any and all claims which you may have arising out of your employment or the termination of your employment. If you wish to accept the terms of severance as outlined above, kindly execute the attached release and return an original copy to my attention no later than Friday, June 10, 2011.
9The applicant testified that she was very upset and crying because she did not expect her employment to be terminated that day. The applicant states that when she asked if she was fired she was told by Ms. Ryckman, “I do not think that we will be able to resolve this so I think that it is better that you leave.” The applicant states that Ms. Ryckman said “If you sign this letter we will pay you out.”
10The applicant signed the release and she was immediately given the two cheques.
11The applicant then testified that she got in her car, read the contents of the termination letter and Release and called her father for advice. The applicant also testified that, the same day, she called Service Ontario and that she was referred to a free 30-minute consultation with a lawyer over the telephone. The applicant states that the lawyer advised her, without seeing the Release, that it did not preclude her from filing an application with the Tribunal.
12The applicant testified that the only reason she signed the Release was so that she could get her cheques. She said that she felt intimidated because there were three representatives of the Spyce Spa present at the termination meeting. She also said that Ms. Ryckman was rocking her chair back and forth which she found intimidating. During cross-examination the applicant acknowledged that she did not immediately cash both cheques and that there was a delay in cashing one of the cheques of at least over one week.
13Ms. Ryckman testified on behalf of the respondent that after the decision to terminate the applicant’s employment was made that a consultant was retained to assist with the applicant’s termination from employment. It is this consultant who prepared the termination letter and the Release. Ms. Ryckman testified that she and Ms. Board practiced what they would say during the termination meeting and they were advised that they should not say too much.
14Ms. Ryckman testified that she recalls Ms. Board stating that things were not working out. Ms. Ryckman had two copies of the termination package. Ms. Ryckman did not testify about what she specifically told the applicant with respect to receiving her cheques. She said that the applicant was crying and upset and that she should take a moment. She testified that she did not tell the applicant that she would be paid her entitlements pursuant to the Employment Standards Act, 2002 regardless of whether or not she signed the Release.
15The other two witnesses called by the respondent, Ms. Board and Ms. Van Casteran, gave evidence consistent with the evidence of Ms. Ryckman.
The Law
16Section 23(1) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, as amended, provides that this Tribunal may make such orders or give such directions in proceedings before it as it considers proper to prevent abuse of its processes. This Tribunal has held that filing a human rights application after signing a full and final release in respect of the subject-matter of the application may constitute an abuse of the Tribunal’s process and where that is the case, such applications should be dismissed. See for example, Hazel v. Ainsworth Engineered, 2009 HRTO 2180; Perricone v. Fabco Plastics Wholesale (“Perricone”), 2010 HRTO 1655.
17The first issue to be determined is whether the language of the Release prohibits the applicant from making an application at the Tribunal. The two-page Release attached to the termination letter clearly states that, “In consideration of the terms set out in the attached letter dated June 7, 2011” the applicant releases Spyce Spa and its officers, directors and employees from all claims including those with respect to her employment. The Release also states at paragraph 3;
I further agree that the said consideration is in full satisfaction and settlement of my right to make a complaint under the Ontario Human Rights Code. I agree that the said consideration represents a voluntary compromise and settlement of any rights which I have or may have had pursuant to that statute. I hereby confirm that no such complaint has been made and I covenant and agree not to make any such complaint. I further acknowledge and agree that in the event that I breach my covenant not to make a complaint, such a complaint should be characterized by the Ontario Human Rights Commission as a complaint made in bad faith.
18Having reviewed the Release I find that the language of the Release is sufficiently clear, specifically at paragraph 3, that the respondents are released from any claims pursuant to the Code.
19Since there is no issue in this case that the applicant executed the Release it is incumbent on the applicant to provide some lawful excuse for not being bound by the strict requirement in the release not to file the Application at the Tribunal.
20In Pritchard v. Ontario (Human Rights Comm.), 1999 CanLII 15058 (ON S.C.), the Divisional Court set out at para. 17 some of the relevant factors to consider under the old Code when deciding whether a human rights claim is barred by the signing of a full and final release:
Undoubtedly, in some cases, an employee who has accepted a sum of money in exchange for a release of claims against a former employer, including human right claims, would be acting in bad faith in subsequently turning around and filing a human rights complaint. However, in other cases, the facts may show that the employee misunderstood the significance of the release, or received little or no consideration for it beyond statutory entitlements under employment standards legislation, or was in such serious financial need that she or he felt there was no choice but to accept the package offered.
21While Prichard was decided with respect to the Code prior to the amendments which took effect in June 2008, the Tribunal has repeatedly endorsed the factors set out by the Divisional Court as applying equally to releases purporting to release claims under the current version of the Code. The applicant has provided the following reasons for not giving effect to the Release:
a. She was upset at the meeting and did not read what she was signing;
b. The respondents in effect made her sign the release to receive payments that she was lawfully owed when they told her that she needed to sign the Release in order to obtain the two cheques; and
c. She felt intimidated by the respondent’s posture during the meeting and because there were three representatives of the employer at the termination meeting.
22In essence the applicant has asserted that the totality of the circumstances constituted duress, and that she did not understand the significance of the Release and that on this basis the Release should not be enforced by the Tribunal.
23Black’s Law Dictionary, 8th ed. (St. Paul, MN: Thomson West, 1999), gives the following as one of the definitions of “duress”:
Broadly, a threat of harm made to compel a person to do something against his or her will or judgment, especially a wrongful threat made by one person to compel a manifestation of seeming assent by another person to a transaction without real volition.
24“Economic duress” is also specifically defined in Black’s, not in terms of a party’s financial circumstances per se, but the threat of financial harm:
… an unlawful coercion to perform by threatening financial injury at a time when one cannot exercise free will.
25The Ontario Court of Appeal described the elements of economic duress in Taber v. Paris Boutique & Bridal Inc. (Paris Boutique), 2010 ONCA 157 at pars. 8-9:
There is no doubt that economic duress can serve to make an agreement unenforceable against a party who was compelled by the duress to enter into it. Nor is there any doubt that the party can have the agreement declared void on this basis.
However, not all pressure, economic or otherwise, can constitute duress sufficient to carry these legal consequences. It must have two elements: it must be pressure that the law regards as illegitimate; and it must be applied to such a degree as to amount to “a coercion of the will” of the party relying on the concept. See: Stott v. Merit Investment Corp. [“Stott”], 1988 CanLII 192 (ON CA), 63 O.R. (2nd) 545 (Ont. C.A.), at para. 89.
26In Stott, the court held that in order for economic duress to be found, the party whom is being illegitimately pressured must be put in position where he has no “realistic alternative” but to submit.
27I have considered the totality of the evidence and I accept that Ms. Assivero was upset at the meeting and that she did not read the termination letter and Release. However, I cannot accept that the respondents in anyway threatened the applicant during the meeting either through their conduct or their statements. I accept the testimony of Ms. Ryckman that she was nervous during the meeting and that she may have been rocking her chair back and forth, however, there is nothing in her demeanour which could have reasonably been interpreted to constitute a “threat” toward the applicant.
28Based on the applicant’s own testimony there was no pressure exerted by the respondents’ which compelled the applicant to immediately accept the offer and sign the Release. She was not prevented from reading or understanding the documents by the respondents. The applicant made a conscious decision not to read or understand the Release and chose to sign it at the termination meeting. In similar situations, the Tribunal has upheld a signed Release; see, for example, Perricone at paras. 68 to 70 and Monteiro v. Inspec-Sol, 2010 HRTO 2281 at paras. 15 and 24 to 28.
29There was sufficient consideration offered by the respondent in excess of the amounts owed to the applicant pursuant to the ESA. Though the two cheques did include amounts owed to the applicant under the ESA, there was no threat by the respondent to withhold those amounts if she did not sign the release.
30Further, I find that the applicant through her conduct accepted the terms and conditions of the settlement by cashing the two cheques and accepting the consideration offered by the respondents. I note that the applicant cashed the second cheque weeks after the termination meeting. At the time that she cashed the two cheques, she had read the Release and understood its terms and had the opportunity of consulting a legal representative.
31Though the applicant stated that, after signing the Release, she was advised that the settlement was not enforceable, I find that in the circumstances of this case this alleged advice does not provide a sufficient basis to find that the Release is unenforceable. First, I have already found that there was no duress at the time the applicant signed the agreement, in which case it was already binding when the applicant changed her mind and decided to contact a lawyer. Second, notwithstanding the allegation that a lawyer told her the agreement was unenforceable, the applicant subsequently went ahead and cashed the cheques which I have already found was an acceptance of the terms of the agreement. Third, there was no evidence from any lawyer with respect to the alleged advice given. Finally, I find that there was clear and simple language which clearly released the respondents and precluded the applicant from filing this Application. In sum, it was unfair for the applicant not to raise the issue of the enforceability of the release with the respondents and to proceed to cash the two cheques. I find that by accepting this additional consideration that she ratified the settlement through her conduct.
32I find in these circumstances that it is an abuse of process for the applicant to accept the consideration under the settlement and then refuse to comply with the plain and simple language of the settlement which clearly released her employer from further or future claims under the Code.
33The Application is dismissed.
Dated at Toronto, this 13th day of December, 2012.
“Signed by”
Geneviève Debané
Vice-chair