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May 21, 2014
Workplace harassment case leads to disability litigation

The Ontario Superior Court of Justice has ruled that a trial can take place to determine whether workplace harassment can lead to a long-term disability.

The case involves a woman employed by a major retailer who was stalked and threatened throughout 2007 by her former fiancé, who was a co-worker at the store where she worked.

By 2008, the harassment triggered panic attacks, anxiety and depression, which were confirmed by medical documentation from her general practitioner and, later, her psychiatrist, who recommended that she take a medical leave of absence.

She repeatedly requested her employer to address the situation but no assistance was provided.

In 2008, she terminated her employment but continued to receive psychiatric treatment.  In 2013, she applied for long-term disability benefits from the retailer’s benefit plan retroactive to early 2008.  The company’s insurer declined her claim.  The case then went to litigation.

In responding to her case, the company’s insurer took the position that the woman had left the company because of the harassment she was experiencing, not as a result of an illness.  As a result, her problem was work-related and had nothing to do with the insurer or its coverage.

They then sought to have the case dismissed.

In reviewing the case, the Court found that the insurer’s argument was too simplistic.

“The approach taken by [the insurer] is simplistic in characterizing the problem as employment-related as opposed to disability-related,” wrote Justice Guy Di Tomaso. [The woman’s] claims not only include her problems in the workplace arising from the presence of the former fiancé but also the causal connection between that workplace relationship and the cause of her psychiatric and psychological conditions.  The connection between the workplace harassment and her alleged disability must be placed in context when her relationship with [her fiancé] is reviewed.”

He then dismissed the insurer’s motion.  However, the judge did call for a subsequent trial to determine the woman’s eligibility for disability payments.

“The test of total disability can only be answered upon review of the totality of evidence which, in this case, must include complete medical and employment files,” he said.  “The question of whether workplace harassment caused her psychiatric and psychological problems is much in issue.”

Justice Di Tomaso warned that, if the woman’s disability is proven in court, the insurer’s refusal to pay her disability claims could amount to a breach of contract and “may give rise to damages for mental stress as well as punitive damages.”

For human resources professionals and benefit plan administrators, this case should reinforce the need to address employment harassment complaints promptly and in consideration of the potential legal and medical/psychological issues that can result from poisonous work relationships.

While the extent of the woman’s disability is still to be decided, it appears that had the employer adequately addressed the harassment issue in the first place, the psychological and subsequent disability claim and its litigation might have been avoided.

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