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Employers can't be sued for Negligent Infliction of Mental Distress - At Least for Now

15-Jul-10

The case of Piresferreira v. Ayotte caught the attention of many employers when a former employee was awarded over $500,000 in damages for abusive treatment by a supervisor. However, in a recent decision, the Ontario Court of Appeal reduced the damages awarded to the employee to $148,000 and further concluded that the trial judge erred in holding that the tort of negligence was available against both the Defendant employer and supervisor.

The employee was constructively dismissed from Bell Mobility in 2005 when her employment as an account manager effectively became impossible after she was diagnosed with post-traumatic stress disorder due to her verbally abusive supervisor who pushed her shoulder during a dispute. The trial judge awarded the employee over $500,000 in damages on the basis that it was reasonably foreseeable that the supervisor’s yelling, swearing, assault, and threats to place her on a performance improvement plan would cause psychological injury.

In overturning the trial judge’s decision, the Court of Appeal noted that the trial judge did not say that the supervisor actually intended or knew that it was highly likely that the employee would suffer the extensive psychological injury she did, and thus the supervisor's actions did not meet the rigorous test required to establish intentional infliction of mental suffering. In addition, the Court of Appeal expressed doubts as to whether the supervisor's conduct was sufficiently "flagrant and outrageous".

In ruling that employers cannot be sued for the separate tort of negligent infliction of mental distress, the Court found that creating a duty of care on employers to shield employees from acts in the workplace, which might cause mental suffering, is too general and broad and would inappropriately insert the Court into the employment relationship. The Court noted that compensation for mental distress in the employment context is already available under the framework set out by the Supreme Court of Canada in Honda v. Keays, in which employees can sue their employers or supervisors for mental suffering inflicted during the termination process. Further, employees who are sufficiently aggrieved by inappropriate behaviour have the ability to sue for constructive dismissal. Recognition of a separate tort is therefore unnecessary.

Finally, while recognizing that an assault did occur, the Court concluded that the damages awarded had been overvalued because the trial judge took into account non-causal actions in a chain of events that took place both before and after the assault.

This case illustrates the continuing see-saw approach taken by our courts in their efforts to hold employers to account for their management of employees.

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