P-2006-0291

IN THE MATTER OF AN ARBITRATION

Under

THE PUBLIC SERVICE ACT

Before

THE PUBLIC SERVICE GRIEVANCE BOARD

BETWEEN

Cassandra Charlton

Grievor

• and -

The Crown in Right of Ontario (Ministry of Community Safety and Correctional Services)

Employer

BEFORE

Donald D. Carter

Chair

FOR THE GRIEVOR

Selwyn A. Pieters Barrister and Solicitor

FOR THE EMPLOYER

Simon Heath Counsel Ministry of Government Services

HEARING

June 18 & 19, 2007.

Decision

This grievance arose from a serious incident of racial harassment related to the workplace. In order to expedite this matter, the parties agreed that the Public Service Grievance Board would determine the appropriate remedy based on agreed upon facts. The terms of that agreement are set out below:

“RE: (Charlton, Cassandra) – and – The Crown in Right of Ontario (Ministry of Community Safety and Correctional Services)

PGSB File No. 2006-0291

In order to expedite the hearing of this grievance, Cassandra Charlton (the “Grievor”) and the Ministry of Community Safety and Correctional Services (the “Employer”) have agreed to the following “Agreed Statement of Facts”. The Agreed Statement of Facts shall only be used for the limited purpose of determining what, if any remedy, the Grievor is entitled to based on the facts outlined below. The Parties agree that this Agreed Statement of Facts shall be used solely for the limited purpose of the present grievance and has no precedential value in this or any other proceeding before any other judicial or administrative body.

1. The Grievor is a Black, Canadian woman of African Descent.

2. The Grievor lives in Toronto.

3. At all material times, the Grievor was and continues to be employed by the Employer.

4. The Grievor commenced her employment with the Employer on October 25, 1999 as a Correctional Officer Two (“CO2”).

5. The Grievor commenced working at the Mimico Correctional Centre on October 25, 1999 and remained there until September 17, 2001. On September 17, 2001, the Grievor was transferred to the Toronto East Detention Centre.

6. The Grievor worked at the Toronto East Detention Centre until she was transferred to the Toronto Jail on November 3, 2003.

7. While working at the Toronto Jail the Grievor successfully competed for and won a position as an Operation Manager 16 (“OM16”) on June 13, 2005. The Grievor’s home position is an OM16 position at the Toronto Jail.

8. On or about September 6, 2005, the Employer commenced screening all incoming mail at the Toronto Jail through its Security Department to prevent any further anonymous threatening letters from circulating in the Toronto Jail.

9. In September 2005 the Grievor enrolled in a labour relations course for managers which was scheduled to run from October 2, 2005 to October 7, 2005 at Bell Cairn, Training Centre.

10. The Grievor commenced attending the course at Bell Cairn on October 2, 2005.

11. On October 3, 2005, the Grievor received one anonymous letter at her personal residence (not at the Toronto Jail or Bell Cairn) which contained racist and inappropriate content (A Copy of which is attached hereto).

12. This was one of a series of anonymous threatening letters received by a total of 8 Black and other racial minority correctional officers who worked at the Toronto Jail. The first anonymous letter was sent on January 13, 2005 and several other employees received letters in the following 18-month period. Once the first letter was received on January 13, 2005, the Employer contacted the Toronto Police to investigate, and the police commenced their investigation commenced immediately.

13. The police investigation was conducted by Detective Denise Campbell a divisional investigator from the Toronto Police, until she went on leave in or about February 2006, at which point Detectives Samuel Samm and Keys took over. The Hate Crimes Division of the Toronto Police which has expertises in these types of anonymous letters also participated in the investigation, as of or about January 20, 2006.

14. After the first couple of anonymous letters had been sent to employees of the Toronto Jail, the Toronto Police advised the Employer not to conduct a section 22 investigation until the Police had conducted their own investigation so that important evidence would not be disturbed, in the event that it would be required to be used in a criminal proceeding.

15. Police investigators identified several “persons of interest” who were employees of the Toronto Jail and some refused to submit to an interview.

16. The Grievor notified Operational Manager Loris Puntillo about the incident on October 3, 2005. Mr. Puntillo notified Superintendant Anna Gulbinski immediately thereafter and Ms. Gulbinski then contacted the Grievor by telephone.

17. The Grievor met with the Police on the night of October 3, 2005, to notify them of the receipt of the letter and the original was turned over to Toronto Police Service investigators.

18. To this date, the anonymous author and/or authors of the Grievor’s letter or any other of the anonymous letters has not been determined by the Police or the Employer.

19. After the Grievor received the letter, the Grievor remained at the course for a few days but she did not complete it due to the traumatic effect that the letter had on her mental psyche.

20. As a result of receiving the anonymous letter at her home, Ms. Connie Hannah, Staff Services, of the Toronto Jail mailed the Grievor the applicable WSIB documentation on October 7, 2005.

21. The Grievor returned the applicable WSIB forms, a copy of the anonymous letter and her key to Bell Cairn on October 12, 2005.

22. The Grievor has remained off work continuously since October 13, 2005. She has provided medical documentation to support this absence.

23. The WSIB provided the Grievor with benefits after concluding she had suffered from “mental stress”.

24. From October 8, 2005 to February 17, 2006, the Grievor received 100% of her salary.

25. In October of 2006, as a result of concerns expressed by several recipients of anonymous letters, the Grievor and other victims of the anonymous letters were offered personal security seminars and personal safety plans by the Ontario Provincial Police, which included an offer by the Employer to provide and pay for the installation and monthly coverage, renewable every 6 months, of home security systems.

26. In or about May 2007, the CISU attended shift Muster at the Toronto Jail and advised all staff that an investigation under section 22 of the Correctional Services Act would be conducted with the assistance of a seconded Toronto Police Service Detective Sergeant. When the employer was asked why they were now prepared to “internally” investigate some 2 years after the initial hate letters were received by victims they responded by saying that the police investigation had not determined who the anonymous author or authors of the hate letters were. Therefore, the Police authorized the Employer to investigate the matters without the possibility of destroying or tampering with evidence that may be used in a criminal proceeding.

27. From February 18, 2006 to December 31, 2006, the Grievor received $808.29 per week, as per applicable WSIB Guidelines.

28. From January 1, 2007 to the present time the Grievor has received $853.18 per week, as per applicable WSIB Guidelines.

29. As of May 10, 2007, the Grievor has also commenced the process to obtain a Non-Economic Loss Award (“NEL”) from the WSIB. WSIB sent the grievor a letter to tell her that she may qualify for the NEL benefit, and to choose one of the doctors on the list, call an appointed WSIB representative to inform them of her choice, and then they will set up a doctor’s appointment for her. The Grievor was also told that if she did not choose a doctor that one will be chosen for her.

30. Since the Grievor left work on WSIB benefits the Parties have discussed her return to work.

31. On September 15, 2006, Ms. Schaefer from the Ministry and the Grievor discussed several possible positions, including the position of cleaner, which was never actually offered to the Grievor.

32. On or about January 23, 2007, the Employer contacted the Grievor and advised her of a possible position as a recruiter.

33. On or about May 03, 2007, the Employer offered the Grievor the job as an OM16 at the Ontario Correctional Institute in Brampton, Ontario.

The Employer agrees that it will compensate the Grievor for the appropriate damages that arise from these agreed facts.

The Parties agree that the amount of these damages shall be determined by Donald D. Carter, Chair of the Public Service Grievance Board.

The Parties also agree that the summonses issued on Friday, June 15, 2007 are no longer operative.”

The letter referred to in paragraph 11 of the agreed statement of facts is set out below:

“HA HA HA

YOU THOUGHT YOU WERE SAFE YOU

STUPID NIGGA BITCH

TELL YOUR NIGGA FRIENDS TO WATCH

WHERE THEY LEAVE YOUR ADDRESS

LAYING AROUND

YOU WALK AROUND PRETENDING TO BE A

MANAGER WHEN YOUR JUST A STUPID

NIGGA BITCH THE BRAIN DEAD FAT SLOP

DOWN THE HALL HIRED

YOU AND YOUR SLUT LIAR OF A NIGGA

FRIEND

SHE THINKS THAT SHE CAN SLEEP HER WAY

TO THE TOP AND BE PROTECTED BY THAT

NIGGA LOVA BLOCK HEAD ROBO COP

BOYFRIEND OF HERS

ONE BY ONE YOULL BE TAKEN OUT

WEARING ORANGE BLUE OR WHITE OR

BEING A NIGGA LOVA YOUR ALL THE SAME

DIRTY NIGGA SCUM BAGS

KKKKKKKKK FOREVER”

Counsel for the grievor sought a number of remedies to repair the damage caused by this serious violation of the grievor’s human rights. One set of remedies was directed at re-integrating the grievor back into the workplace in a comparable position but in an environment that would be free of any threat of further racial harassment. Another set of remedies was directed at repairing the economic loss suffered by the grievor as the result of this violation of her human rights. One aspect of this economic loss was that the WSIB benefits being received by the grievor did not provide her with the same level of income as she would have earned if her rights had not been violated, especially because of the overtime that she would have worked. Counsel pointed out that, because of the significant reduction of income that had occurred, the grievor had suffered an additional economic loss by being forced to sell her house. As well, because the grievor could no longer afford the premiums for her dental plan, she also ended up paying some large dental bills on her own. A third set of remedies were directing at compensating the grievor for her non-monetary losses, particularly for the continuing emotional distress caused by a serious breach of her human rights. Finally, counsel for the grievor requested that the Board award legal costs to his client.

Counsel for the employer argued that the damages should be more limited in their scope, and that this was not an appropriate case for the awarding of costs. Counsel’s primary argument was based on the Workplace Safety and Insurance Act, 1997. According to counsel, since the grievor’s injury had been treated under that statute as an accident arising out of the course of her employment for which she was receiving WIB benefits, s.26(2) of that statute applied and precluded any further remedy for loss of income from this Board . That provision provides:

“Entitlement to benefits under the insurance plan is in lieu of all rights of action (statutory or otherwise) that a worker, a worker’s survivor or a worker’s spouse, child or dependant has or may have against the worker’s employer or an executive officer of the employer for or by reason of an accident happening to the worker or an occupational disease contracted by the worker while in the employment of the employer.”

Counsel argued that the effect of this provision was to preclude any claim before this Board for loss of income, only leaving open the possibility of a claim for damages for injured feelings or loss of dignity.

As for damages for injured feelings or loss of dignity, counsel for the employer argued that this Board should be guided by the section 41(1)(b) of the Human Rights Code, R.S.O. 1990, ch19, which provides for awards not exceeding $10,000 for mental anguish “where the infringement has been engaged in wilfully or recklessly”. Counsel pointed out that the employer had taken all reasonable steps to address the matter once it had been brought to its attention and argued that the employer’s conduct could in no way be characterized as either wilful or reckless. Counsel argued that, given the employer’s efforts after the incident of racial harassment was brought to its attention, damages for mental anguish, if any at all, should be only a modest amount. Finally, counsel for the employer argued that this was not a case where the Board should deviate from its well-established policy of not awarding costs, especially in light of the employer’s willingness to concede the issue of liability and only leave open for adjudication the issue of the appropriate amount of damages.

There was little argument over the Board’s jurisdiction to direct the employer to reintegrate the grievor back into the workforce. Indeed, at the hearing, discussions had already begun as to suitable future employment for the grievor. At this stage, therefore, there is no need for the Board to do no more than to issue a general direction that the employer make all reasonable efforts to find a position comparable in responsibility and remuneration to the position held by the grievor but in a work environment free of any threat of racial harassment. Accordingly, the Board makes this order but remains seized of this matter to deal with any issues relating to its interpretation and application.

The issue of appropriate damages, however, is more complex. The starting point for the resolution of this issue of damages must be an examination of the Board’s jurisdiction to deal with this matter of racial harassment. The Public Service Grievance Board is an independent adjudicative tribunal established under Regulation 997, s. 42(1), of the Public Service Act, R.S.O. 1990, c.P.47. Its mandate is to provide dispute resolution services to resolve employment disputes between certain members of the Ontario Public Service who are not covered by a collective agreement and their employers. Those employees within the Board’s mandate who are aggrieved about a “working condition or term of employment” have access to a grievance process. Unresolved grievances are ultimately determined by the Public Service Grievance Board and, subject only to judicial review, the decision of the Public Service Grievance Board is final.

The Board’s jurisdiction to provide a remedy in this case flows from the fact that one of the many working conditions and terms of employment between the grievor and the employer is a guarantee against workplace racial harassment. Section 5(2) of the Human Rights Code, supra, provides that “[e]very person who is an employee has a right to freedom from harassment in the workplace by the employer or agent of the employer or by another employee because of race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, age, record of offences, marital status, family status or disability”. Section 47(1) of the Human Rights Code provides that the Code binds the Crown and every agency of the Crown. Even more significant is section 26 of the Code, providing that “[i]t shall be deemed to be a condition of every contract entered into by or on behalf of the Crown or any agency thereof and of every subcontract entered into in the performance thereof that no right under section 5 will be infringed in the course of performing the contract”. In the Board’s view, this provision is sufficiently broad in its wording to include within its scope contracts between the Crown and its own employees. What this means is that a clear term of the grievor’s employment with the Crown is that she has a right to be free from racial harassment in the workplace.

This conclusion is entirely consistent with the decision of the Supreme Court of Canada in District of Parry Sound Social Services Administration Board v. O.P.S.E.U., Local 324, 2003 SCC 42, [2003] S.C.J. No. 42. In that case, the Supreme Court of Canada was faced with the issue of whether a dismissal of a probationary employee could be arbitrated on grounds that the dismissal was inconsistent with human rights legislation. At issue in Parry Sound was whether, despite the lack of any express reference in the collective agreement to human rights legislation, a grievance arbitrator still had jurisdiction to deal with a grievance alleging that the grievor’s dismissal following her return from maternity leave was contrary to human rights laws.

A majority of the Court in Parry Sound took the position that “the substantive rights and obligations of employment-related statutes are implicit in each collective agreement over which an arbitrator has jurisdiction” and that the effect of these statutory rights was to qualify any managerial rights conferred upon employers by a collective agreement. From this conclusion it followed that a grievance alleging that managerial rights had been exercised in a manner inconsistent with human rights legislation constituted a difference that arose under the collective agreement and, as such, fell within the jurisdiction of a grievance arbitrator. It is clear that, after Parry Sound, the employment obligations imposed by human rights legislation are implicit terms of all collective agreements entered into by the Crown.

It is entirely consistent with Parry Sound to draw the further conclusion that these human rights guarantees are implicit contractual terms in the individual employment contracts between the Crown and those of its employees who are not covered by collective agreements. Therefore, even if this Board is not correct in its conclusion that the language of section 26 of the Human Rights Code is sufficiently broad to incorporate expressly human rights guarantees into the contracts that the Crown makes with its employees, these guarantees are at least implicit terms of these individual contract of employment by virtue of the reasoning of the Supreme Court of Canada in Parry Sound. It is this contractual guarantee of freedom from racial harassment that provides the Board with its remedial jurisdiction in this case.

This remedial jurisdiction flows from the Board’s statutory mandate to provide a final resolution of employment disputes of those members of the Ontario Public Service falling within its jurisdiction. This remedial jurisdiction has been exercised by the Board for many years and its scope has been well defined by the Board’s own jurisprudence. It is a remedial jurisdiction that is distinct from the jurisdiction conferred on human rights tribunals by section 41 of the Human Rights Code, and it should be made clear that the Board is not relying on that remedial provision in fashioning the appropriate remedies in this case. Rather, the remedies in this case flow from the Board’s own remedial jurisdiction.

The next question to be addressed is the extent to which the Board’s remedial mandate in this case is limited by the provisions of the Workplace Safety and Insurance Act, 1997. In Bardhan and Ministry of Health, PSGB # P/0061/93, P/0066/93, a grievor sought compensation for alleged injuries to his health. In that case, the Board, quite correctly, declined to deal with the claim, making it clear that compensation for workplace injuries was within the exclusive jurisdiction of the workers’ compensation regime. The claim before the Board in this case, however, is quite different.

In this case, the claim is for breach of the contractual guarantee of freedom from racial harassment in the workplace. What occurred here was much more than an “accident” as defined by the Workplace Safety and Insurance Act, 1997. It was a vicious and hurtful racial slur that not only affected the grievor’s health but also caused substantial injury to the grievor’s dignitary interests. While the worker’s compensation scheme has exclusive jurisdiction over that aspect of her injury dealing with her health, exclusive jurisdiction over this one aspect of her injury does not preclude this Board from dealing with the very substantial injury to her dignitary interest. Indeed, counsel for the employer recognized this distinction, but argued that any compensation for loss of income was related only to the injury to her health and so fell within the exclusive jurisdiction of the workers’ compensation regime.

The Board does not accept the argument that, where there has been the breach of the contractual guarantee of freedom from racial harassment in the workplace, that compensation for loss of income relates only to the injury to the victim’s health. The jurisdiction of this Board is to compensate the grievor for damage to her dignitary interest as far as can be done by a monetary award. A monetary award that does not provide for complete compensation for the full financial loss arising from the breach of such a fundamental term of the contract would fall well short of this remedial mandate. Put another way, if the grievor’s dignitary interest is to be restored, she should not be financially worse off than if the racial harassment had not occurred. The Board, therefore, concludes that it does have jurisdiction to compensate the grievor for all financial losses that flowed from the workplace racial harassment that she suffered.

What are these financial losses? It is clear that there is a significant difference between what the grievor is receiving in the way of WSIB benefits and what she would have continued to earn had the racial harassment not have occurred. In order to properly compensate her for the injury to her dignitary interests, she is entitled to the difference between these amounts until she has been reintegrated into a position that is the financial equivalent of the position that she held at the time that the harassment occurred. Accordingly, the Board directs the employer to pay to the grievor forthwith the difference between what she would have earned had the racial harassment not occurred and the WSIB benefits that she has received, and will be receiving until she is reintegrated into an appropriate position in the workplace that is the financial equivalent of the position that she held at the time of the racial harassment. The Board remains seized to deal with any issues arising from the interpretation and application of this order.

It was also argued that, because of the grievor’s loss of income, she was forced to sell her house at a loss. If the grievor can establish that she would not have been forced to sell the house but for the racial harassment, then she is also entitled to be made whole for this loss The facts supporting this claim, however, were not set out in the agreed statement of fact, so that the Board will remain seized of this issue to hear further evidence and argument on this claim unless it is otherwise resolved by the parties.

The grievor’s claim for her dental bills is another matter. The Board considers that this loss flows from the grievor’s own decision not to continue her dental insurance. While it is understandable, given the mental distress caused by the harassment, that the grievor made a less than prudent decision to discontinue her dental benefits, this is a matter more appropriately dealt with as a factor in the award of damages for mental distress. This observation brings us to the matter of damages for mental distress.

The Board not only has jurisdiction to compensate the grievor for her financial losses but, as well, has jurisdiction to award damages for the mental distress suffered by the grievor as the result of the racial harassment. The Board in Morrison and Human Rights Commission, PSGB # P/0037/94, P/0037/95, clearly signalled that aggravated damages could be awarded by the Board in appropriate cases, although making clear that such awards were to be compensatory in nature and available only where other remedies would inadequately compensate the grievor. Such awards for mental distress damages would, of course, also have to flow from some breach of a contractual term of employment in order for the Board to have remedial jurisdiction.

The Supreme Court of Canada, in Fidler v. Sun Life Assurance Co. of Canada 2006 SCC 30, [2006] S.C.J. No. 30, has now provided guidance as to when it is appropriate to compensate for mental distress damages that flow from a breach of contract. The Court in that case made it clear that the term “aggravated damages” had been used in the past to describe two quite different legal situations. The first legal situation involved aggravating circumstances occurring at the time a contract was breached, and not the breach of the contract itself. In this type of case, it was necessary to establish that the aggravating circumstances constituted an independent cause of action, usually in tort. The second legal situation where the term “aggravated damages” was also used involved damages for mental distress arising from the breach of contracts that create the expectation of an intangible “psychological benefit”. These damages existed independently from any aggravating circumstances and flowed from the contractual expectations of the parties. They were entirely compensatory in nature, since the conduct of the party in breach was not a factor that determined either the entitlement to mental distress damages or the amount of these damages.

The significance of the Fidler decision is that the Supreme Court of Canada has now made it clear that, even in the absence of bad faith, mental distress damages may flow from the breach of contracts that create the expectation of a “psychological benefit” and that this type of damage need not be based upon an independent actionable wrong. In other words, mental distress damages are not dependent on some form of egregious conduct on the part of the person in breach of the contract but flow directly from the breach of certain types of contractual terms, compensating for the mental distress that flows from the breach.

The analysis in Fidler fits comfortably with the analysis of aggravated damages taken by the Board in Morrison. The Board in that case clearly indicated that aggravated damages were only intended to be compensatory and only available in limited situations.

Clearly not all terms and conditions of employment create the expectation of a “psychological benefit”, and damages for mental distress are only available for breach of this type of contractual term. How then does this analysis bear on the facts now before this Board?

In this case there has been a breach of the contractual guarantee of freedom from racial harassment in the workplace. Such a term, in the Board’s view, does create an expectation of a “psychological benefit”, since this provision in the employment contract is clearly intended to protect the dignitary interests of the employee. It is this provision that has been breached and, while the employer has been beyond reproach in attempting to deal with the problem of workplace racial harassment after it arose, there is also no question that the grievor has suffered very substantial mental distress as the result of a particularly nasty form of workplace harassment. Given the very substantial disruption to the grievor’s life and peace of mind that was caused by the breach of the contractual guarantee of freedom from racial harassment in the workplace, the Board considers that the amount of damages for mental distress should be no less than what was considered appropriate in the Fidler case. Accordingly, the Board directs the employer to pay the grievor forthwith the sum of $20,000 for mental distress arising from the breach of the contractual guarantee of freedom from racial harassment in the workplace.

The final issue to be resolved is the grievor’s request for costs. As the Board pointed out in Gibson and Ministry of the Attorney General, PSGB # P/0134/96, costs are only awarded by the Board in the most egregious cases of employer misconduct. In this case, there has been absolutely no evidence of employer bad faith in either its response to the incident of racial harassment itself or in its conduct at the hearing. Indeed, the employer is to be commended for suggesting and then agreeing to a process that has substantially shortened what could have been a very lengthy hearing. In these circumstances, it would not be appropriate to deviate from the Board’s well-established policy by awarding costs to the grievor.

Dated at Toronto this 27th day of June, 2007.