Article by: Adam James
Previously printed in the LexisNexis Labour Notes Newsletter.
Employment litigation is rarely straightforward and employers must be prepared to deal with claims in multiple forums, including in civil court and before administrative tribunals responsible for interpreting and applying human rights, workers compensation and privacy law (to name a few).
When faced with a volley of different but related claims, it can be tempting to focus all of your attention on the claim which represents the biggest threat. That would be a mistake — while you should strategically allocate resources, it is crucial to keep all actual or potential claims in mind because decisions in one forum could be relied upon in another.
A recent BC case, Read v. Rimex Supply Ltd., 2021 BCSC 2157, provides a helpful reminder of an important legal doctrine called issue estoppel. That doctrine works to prevent a party from relitigating or re-arguing a point already determined in an earlier decision. The underlying purpose of issue estoppel is to avoid the inefficiency and potential for conflicting decisions which could result out of a party, unhappy with a decision on a particular point in an earlier case, relitigating or re-arguing that point in a new case. While originally applied by the courts, the doctrine has now been applied in the administrative sphere as well, although with some modifications given the diversity of administrative decision-makers and processes.
Summary of case
In Read, the employee worked as the director of manufacturing for the employer (a manufacturer of rims and wheels for the mining industry) when he was discharged for just cause on February 1, 2019. The employer relied on alleged breaches of trust and fiduciary duty as the grounds for discharge.
There were three separate legal proceedings: a complaint to Service Canada; an employment standards complaint; and a civil claim for wrongful dismissal.
In both the Service Canada and employment standards decisions, the employee was successful in proving the employer did not have just cause for discharge. When the employer relied on cause in its defence in the court proceeding, the employee brought a summary trial application on the basis that there was already a binding decision to the effect the employer did not have cause and it could not relitigate or re-argue the point. While the parties agreed the Service Canada decision did not meet the requirements for issue estoppel, the employee relied on the employment standards decision in an attempt to bar the employer from arguing cause.
The BC Supreme Court agreed with the employee that the employment standards decision met the basic criteria for issue estoppel: the same question had been decided previously; it was in the nature of a final decision of a judicial nature; and the parties were the same.
However, the Court noted that even if those basic criteria are met, it maintains a residual discretion as to whether to apply the doctrine of issue estoppel. In the context of administrative tribunals, a decision-maker must be alive to the objective of balancing “fairness to the parties” against “protection of the administrative decision-making process, whose integrity would be undermined by too readily permitting collateral attack or re-litigation of issues once decided”.
The Court found the employment standards process is designed to provide basic compensation to employees and necessarily a more streamlined and efficient process than in civil court. The employer, for example, had a limited ability in the employment standards process to seek evidence from the employee’s wife, who was implicated in the allegations of breach of trust and fiduciary duty. The stakes were also vastly different: the Court found the value of the civil claim to be 15 times that of the employment standards claim. The Court’s finding of potential unfairness or injustice grounded its refusal to apply issue estoppel.
While the Read decision might provide some comfort to employers facing multiple claims in different forums, it is important to remember that the Court found the basic criteria of issue estoppel to have been met in the case — the employer was only permitted to argue just cause for discharge as a result of the exercise of the Court’s discretion.
Even in situations where a court is considering a prior employment standards decision, it is possible based on the particular facts of the case that a different conclusion could be reached. It is thus critical to respond to all claims strategically and consider future implications for other actual or potential claims whenever making a decision in any case. In particular:
- Consider whether it is advantageous to participate in legal proceedings where the employer’s participation is not required. A good example is a Service Canada proceeding — given that there may be no monetary implications for the employer, it is often wise to avoid participation altogether.
- If different departments or divisions of the employer are responsible for the management of different claims (e.g. one team at the employer deals with matters of workers compensation and another team deals with matters of human rights), ensure there are regular check-ins between the respective departments or divisions and that no major decisions are made without proper discussion and consultation.
- Similarly, keep your external legal counsel apprised of all proceedings – even if certain claims are managed internally – and seek input on all major decisions.
Adam James is a lawyer at the Vancouver-based employment and labour law boutique of Roper Greyell LLP. He has a broad employment and labour law practice and enjoys helping clients effectively navigate all of their workplace law issues. He can be reached by e-mail at firstname.lastname@example.org.
Donna Chapman-Jones is an articled student at Roper Greyell. She completed her JD at the Peter A. Allard School of Law at the University of British Columbia in May 2021. She first joined Roper Greyell as a summer student in 2020 and is now completing her articles and gaining experience in all areas of workplace law.
For more information about Adam, Donna and the other members of the Roper Greyell team, please visit www.ropergreyell.com.
While every effort has been made to ensure accuracy in this article, you are urged to seek specific advice on matters of concern and not to rely solely on what is contained herein. The article is for general information purposes only and does not constitute legal advice.
 Danyluk v. Ainsworth Technologies Inc., 2001 SCC 44.