Canadian Covid-19 Policies: Refusal To Comply May Justify Termination
As is the case in many other jurisdictions, Canadian employers have been faced with a variety of novel HR and legal issues which have arisen during the course of the Covid-19 pandemic. One particularly challenging issue is how to deal with cases of employees who voluntarily refuse to comply with employer health and safety rules and the related policies which organizations have adopted in response to the pandemic.
A recent Alberta decision provides some very helpful guidance for employers, with a finding that a refusal to comply with a reasonable employer rule may result in an employee’s contract of employment being repudiated, thus disentitling them from a right to claim damages from the employer.
In Benke v Loblaw Companies Limited, 2022 ABQB 461, the Alberta Court of Queen’s Bench considered a case of an employee who had been placed on an unpaid suspension as a result of his failure to comply with the company’s Covid-19 Mask Policy. Mr. Benke’s role required him to visit company stores, and he was therefore advised that he would need to comply with mandatory masking rules in order to carry out his duties. He voluntarily refused, saying that this requirement amounted to an improper imposition of a new rule which had not previously been part of the “bargain” that was his employment agreement with his employer Loblaws.
The Court emphatically rejected the claim that the Mask Policy was a substantial change to Mr. Benke’s employment relationship, or that the adoption of the rule amounted to a constructive dismissal. Instead, the Court held that the employee’s voluntary refusal to adhere to the Policy constituted a repudiation of the employment agreement (and employment relationship) by the employee.
The employer’s Mask Policy was adopted in August 2020, at a point in time when many organizations were implementing workplace rules which attempted to address known health and safety risk. The specific Policy in dispute was based largely on related public health guidelines which had been adopted by the City of Calgary, and which Mr. Benke also arguably had to comply with to do his job. The Policy contemplated exemptions for medical exemptions or any situation where an individual sought and obtained accommodation from the employer.
Mr. Benke attempted to exclude himself from the application of the employer’s policy by submitting a doctor’s note which claimed he could not wear a mask due to illness. No specific illness was identified, and the note did not provide any explanation about what medical restrictions allegedly existed which would have prevented Mr. Benke from wearing a mask. The employer proceeded to make inquiries, and it became clear that there was in fact no medical evidence which supported a disability-related exemption from the Policy. In the face of this, the employee continued with his voluntary decision to refuse to mask. The resulted in the employer placing him on unpaid leave.
In his lawsuit against the employer, Mr. Benke claimed as an initial matter that there was a failure to accommodate him. This argument was rejected on the basis that there was no identified medical condition or restrictions which were supported by any evidence. Instead, the employee decision to refuse to mask amounted to a voluntary choice which did not attract the protections of applicable human rights legislation.
The core allegation in the litigation was the employee’s claim that it was a constructive dismissal on the part of the employer when the Mask Policy was introduced. The Court dismissed this argument, noting that it was not a fundamental change to the employment contract when the employer adopted a reasonable rule intended to address health and safety rules. Further, the employee’s duties did not change. With respect to the imposition of an unpaid leave, the Court held that although this was a substantial change (since the employee would not be paid), this was not a breach of the employment agreement – it was the employee’s own refusal to follow relevant rules which amounted to the repudiation of the contract.
Employers and employees have an essential bargain, which includes a mutual agreement that the employer will assign work and pay the employee to do that work. When the employee essentially refuses to do the work based on reasonable work assignments from the employer, then it is not the employer which is terminating the employment relationship. In this particular case, Mr. Benke was not working or being paid because of his own voluntary choice of refusing to mask.
When confronted such a repudiation by the employee, the Court noted that employers have a choice – they can either treat the employment as having ended, which is equivalent to a resignation, or they can use the tool of an unpaid leave to see if the employee will reconsider their decision. The Court held in very clear terms that employers who follow the unpaid leave option will not be punished when the actions of the employee are reviewed – given the employee a “final chance” to reconsider is not an admission that the employer had no right in the first place to treat the employment relationship as having been repudiated. In Mr. Benke’s case, this meant that any losses which he may have incurred after being placed on unpaid leave by his employer were self-inflicted and could not be claimed against the company.
Takeaways for Employers
The Benke decision is a very encouraging result for Canadian employers, especially since the Covid-19 pandemic continues. Many employers across the country have adopted various pandemic-related policies, particularly with respect to masking and vaccinations. This Court ruling states quite clearly that the adoption of new rules does not automatically give employees the right to voluntarily refuse compliance. Instead, provided the relevant rules are clear and reasonable, employees who voluntarily fail to comply without proper reason do so at their peril.