Decision: Employer’s Masking Policy Did Not Lay the Grounds for a Constructive Dismissal Claim
In a recent decision Benke v. Loblaw Companies Limited [“Benke”], the plaintiff, Mr. Michael Benke, was placed on an unpaid leave of absence for refusing to comply with his employer’s mandatory masking policy. Mr. Benke quit and sued his employer, Loblaw Companies Limited, for constructive dismissal. The Court dismissed Mr. Benke’s claim, stating that although the “unpaid leave was a substantial change to Mr. Benke’s employment relationship … it was not a breach of the employment agreement.”
In August 2020, Loblaw implemented a policy mandating face masks in its stores to mitigate the transmission of the COVID-19 virus (the “Mask Policy”). The Mask Policy was implemented shortly after local governments passed bylaws mandating face masks in indoor public places.
Mr. Benke was a Customer Experience Specialist for Loblaw. His role required him to work partly remotely, and partly in-store. Mr. Benke sought an exemption to the Mask Policy – which required him to wear a face mask while at work – based on an undiagnosed medical condition. His physician provided him with notes to exempt him from complying with the City’s mask bylaw, and Loblaw’s Mask Policy.
The employer investigated the issue, and it became clear that despite the physician’s medical notes, Mr. Benke’s exemption request was not based on any medical condition preventing him from wearing a mask. After he refused to wear a mask for in-store visits, Loblaw’s placed Mr. Benke on an unpaid leave of absence. Mr. Benke claimed that his employer’s actions led to his constructive dismissal and that he was entitled to substantial damages as a result.
The Court dismissed the employee’s claim, finding that the Mask Policy and Loblaw’s decision to place the employee on an indefinite unpaid leave did not amount to a constructive dismissal.
The Court restated the established test for constructive dismissal outlined in the Supreme Court of Canada decisions Farber v. Royal Trust and Potter v. New Brunswick (Legal Aid Services Commission). More specifically, constructive dismissal occurs where:
- an employer has imposed a unilateral substantial change that constitutes a breach of the employment agreement, and
- a reasonable person in the employee’s position would have felt that the breach substantially altered an essential term of the employment agreement.
The Court determined that the employee had failed to meet this test and was therefore not constructively dismissed. The Court found that, in order for Mr. Benke to perform the duties of his role, he was required to comply with the City’s mask bylaw, and with the employer’s Mask Policy. By refusing to comply, the employee repudiated his own employment contract.
Despite Loblaw’s records showing that Mr. Benke was on an unpaid leave, the Court held that there can be no doubt the employee resigned. The Court was able to draw this conclusion based on the fact that the employee returned his company vehicle, filed a human rights complaint, filed a lawsuit for constructive dismissal, and obtained full-time employment with a different employer.
The Bottom Line
This is a welcome decision for employers who have implemented similar mask policies, provided those policies account for exemptions required under human rights legislation. The Benke decision suggests that it was reasonable for Loblaw to place the employee on an unpaid leave of absence (rather than terminate him for just cause) for refusal to comply with a mandatory mask policy. The Benke decision also shows that mask policies do not lay the grounds for constructive dismissal claims where employees refuse to comply (without valid exemptions).
As we head into the fall and with the recent rise of COVID-19 cases, there may still be a need for mask and vaccination policies in the workplace. It remains to be seen whether the courts will reach a similar conclusion with respect to mandatory vaccination policies.
There are a number of important factors to be considered when structuring a mandatory mask and vaccination policy. If you are looking for a dedicated team of experts to review, revise, and/or draft such policies for you, please do not hesitate to contact us.