In an important decision for employers, the Alberta Court of Queen’s Bench in Benke v Loblaw Companies Limited has held that an employee was not constructively dismissed after being placed on unpaid leave for failing to comply with a mandatory masking policy.
In August, 2020 Loblaw Companies Limited (“the Company”) implemented a mandatory masking policy (the “Mask Policy”) due to the ongoing impacts of the COVID-19 pandemic. This policy required customers and employees to wear a mask when inside stores, subject to certain exemptions, including those with an underlying medical condition or disability that would inhibit the ability to wear a mask.
The employee was a long term employee who was required to work partly in-store and partly remote. After the implementation of the Mask Policy, the employee sought an exemption based on an undiagnosed medical condition.
In support of his request for an exemption, the employee provided two letters from his physician, which stated that he was unable to wear a face mask. However, the letters did not state that the employee’s exemption request was based on a medical condition or disability. During further investigation, the employee allegedly told an occupational health nurse the exemption was “not medical”. On these facts, the Company determined that the employee did not qualify for an exemption to the Mask Policy.
As a result of the employee’s refusal to comply with the Mask Policy and failure to establish that he qualified for an exemption, the Company placed him on an indefinite unpaid leave. In response, the employee claimed that this constituted a constructive dismissal and that he was entitled to damages in lieu of notice of termination. The matter proceeded by summary trial.
The Court determined that the implementation of the Mask Policy and placing the employee on an unpaid leave did not amount to a constructive dismissal.
The Court came to this conclusion after making the following findings:
- The Company had no obligation to accommodate the employee because there was no medical justification for a mask exemption. The employee adduced no evidence of a medical condition or disability to support his request for exemption.
- The Court did not consider the Company’s imposition of the Mask Policy to be a substantial change to the employment relationship, nor did it consider the policy to breach the employment agreement. The Court found that the employee’s job responsibilities did not change, and the Mask Policy was co-extensive with legal requirements imposed by public health authorities and municipalities, including the City of Calgary, to limit the spread of COVID-19, and that the Mask Policy was analogous to other mask policies that have been held to be reasonable by other decision-makers, including the Human Rights Tribunal of Alberta.
- Although placing the employee on an unpaid leave was found to be a substantial change to the terms of employment, the Court determined that it did not breach the employment agreement. The essence of an employment bargain is that an employee will work and perform various duties, and in return, the employer will pay for such services. However, the employee’s inability to work was a consequence of a voluntary choice that he made, therefore the Court determined it was reasonable for the Company not to compensate him.
- In refusing to comply with the Mask Policy, the employee repudiated the employment contract. Yet, instead of accepting the employee’s refusal to abide by the Mask Policy as a repudiation of his employment agreement and terminating his employment, Loblaw reasonably placed the employee on an unpaid leave.
The Court ultimately held that even though the employee did not explicitly resign from his employment, his resignation could be inferred from his actions, including that he commenced this action against Loblaw, obtained full-time employment with a different employer, and returned his company vehicle.
This is a positive decision for employers, highlighting the validity and reasonableness of workplace masking policies implemented to increase safety and reduce the spread and harmful effects of COVID-19.
Where properly implemented, such policies do not amount to a fundamental change to the terms of the employment relationship, and employees who are subject to administrative consequences such as being placed on an unpaid leave of absence for failure to comply (without a valid exemption) are not necessarily going to be considered constructively dismissed.
Employers who have questions about COVID-19 policies and related workplace matters can contact the Labour, Employment and Human Rights group at Fasken.