Ontario Severance

Employer Liability — Ontario Employment Law

122 casesDecisions from 1894–2025

About Employer Liability

In Ontario employment law, "employer liability" refers to the legal and financial accountability a company holds for what happens inside its workplace. While related concepts focus on proactive duties—such as what a company ought to do on a daily basis—employer liability comes into focus when obligations are breached and an employee suffers harm. It is the mechanism that ensures corporations answer for unsafe environments, discrimination, or unfair dismissals.

Employers in Ontario can be held accountable under several distinct legal frameworks. Under the Ontario Human Rights Code (OHRC), a company faces direct liability if management or human resources knew—or ought reasonably to have known—about ongoing discrimination or harassment, yet failed to intervene. When leadership turns a blind eye to racial slurs, unequal treatment, or pervasive bullying, the company can be held fully liable for condoning a poisoned work environment.

Statutory liability also exists under the Occupational Health and Safety Act (OHSA). In the realm of workplace safety, employers are held to a standard of strict liability. This means a corporate entity can be penalized for safety hazards even if an individual employee contributed to the danger—for instance, by ignoring rules and removing mandated protective equipment. The law places the ultimate burden of enforcing safe, compliant practices directly on the employer's shoulders.

Additionally, companies carry significant civil exposure under the common law. Courts can award substantial damages for wrongful dismissal, particularly when an employee is terminated as a reprisal for reporting safety or harassment issues. In scenarios where an employer's conduct is exceptionally harsh, malicious, or dismissive of severe workplace abuse, judges may impose aggravated or punitive damages on top of standard severance.

A fundamental aspect of employer liability is that aggrieved workers generally direct their legal claims against the corporate entity itself, as the company possesses the resources and the ultimate authority over the workplace. Because determining the exact boundaries of corporate responsibility involves complex, overlapping legislation and nuanced case law, the avenues for compensation vary based on the specific incident. Sitting down with a qualified employment lawyer is the most effective way to analyze the facts of your ordeal and determine exactly how your employer can be held legally accountable.

Frequently Asked Questions

Can my employer be held financially liable if a co-worker discriminates against me?

Yes. Under the Ontario Human Rights Code, if management or human resources knows about the discrimination but fails to take adequate steps to investigate and stop it, the employer themselves can be held liable for creating or condoning a poisoned work environment.

Is the company legally responsible if I get injured because I forgot my hard hat or safety goggles?

Often, yes. Under the Occupational Health and Safety Act, employers rely on a standard of strict liability to ensure safety compliance. Even if an employee neglects to use proper equipment, the employer can still face liability for failing to diligently supervise and enforce those safety protocols.

Who do I name in a lawsuit: the abusive manager or the company itself?

While you can sometimes name the specific individual whose actions caused harm, the corporate entity is almost always named as the primary defendant. The employer is legally liable for failing to provide a safe workplace and invariably has the financial means to satisfy a damages award.

Will my employer face extra liability if they fire me for asserting my rights?

Absolutely. Firing someone in retaliation for reporting harassment, discrimination, or a safety hazard is considered an illegal reprisal in Ontario. Employers acting this way expose themselves to liability for wrongful dismissal damages, human rights remedies, and potentially punitive damages.

Are there deadlines to initiate a claim against my employer?

Yes, strict timelines govern when you can assert a claim. Applications to the Human Rights Tribunal of Ontario generally must be filed within one year of the discriminatory incident, whereas civil lawsuits in Ontario courts typically adhere to a two-year limitation period.

When should I get help to prove my employer's liability?

You should seek an evaluation from legal counsel as soon as you realize internal HR complaints are being ignored or if you face retaliation. Establishing corporate liability often requires early evidence gathering, and a professional can guide your next steps before you consider resigning.

Common Scenarios

  • A warehouse worker repeatedly tells management that a shift supervisor constantly uses racial slurs, but management just tells the worker to ignore it. By failing to stop the behavior, the company becomes legally liable for fostering a toxic work environment under human rights legislation.
  • A senior executive leverages their authority to sexually harass a subordinate over several months. Because the executive holds significant power and breached their fiduciary duty to act in good faith, the company faces liability for substantial aggravated and moral damages.
  • A construction firm is penalized by safety regulators because a crew member operated a high-speed grinder without mandatory eye protection. Even though the worker willfully chose to remove the goggles, the employer is found strictly liable for failing to enforce safety enforcement.

What You Should Know

  • Always put complaints regarding harassment, discrimination, or safety hazards in writing to create an undeniable record that management was informed, which immediately triggers their legal duty to respond.
  • Do not assume your employer is protected from liability simply because an updated HR manual exists; Ontario courts look at whether the company actively enforced its policies, not just whether they were distributed.
  • Maintain a chronological log detailing when workplace issues started, who you reported them to, and exactly how the company failed to handle the matter.
  • Before deciding to quit a toxic environment in frustration, have a legal professional evaluate the company's liability profile, as resigning abruptly can sometimes complicate your ability to claim compensation.

Featured Cases

Royal LePage RCR Realty Brokerage v. Human Rights Tribunal of Ontario

2025 ONSC 6276 (CanLII) · 2025-11-28

HRTO Judicial Review: Procedural Fairness & Default Decisions

A judicial review of a Human Rights Tribunal of Ontario decision regarding an employer's failure to respond to Tribunal communications. The Divisional Court quashed the Tribunal's decision, finding it unreasonable and procedurally unfair for relying on deeming provisions to waive the employer's rights without considering contextual factors or the principle that a client should not be penalized for counsel's failures.

employer liability human rights judicial review procedural fairness tribunal decision

Ontario (Labour, Immigration, Training and Skills Development) v. Greater Sudbury (City)

2025 ONCA 329 (CanLII) · 2025-03-31

OHSA Due Diligence Defence: City of Greater Sudbury Appeal

This is an appeal regarding a criminal or statutory infraction under the Occupational Health and Safety Act. The Court of Appeal denied leave to appeal a decision that upheld the City of Greater Sudbury's acquittal for OHSA violations, finding that the lower courts correctly applied the due diligence defence.

appeal due diligence employer liability occupational health and safety statutory infraction

Ontario (Ministry of Labour, Immigration, Training and Skills Development) v. Limen Group Const. (2019) Ltd.

2023 ONCJ 535 (CanLII) · 2023-11-29

OHSA Prosecution: Due Diligence and Employer Liability

This is a merits decision in a statutory prosecution under the Occupational Health and Safety Act involving a corporate defendant and individual supervisors. The court addressed whether the defendants were employers or supervisors, whether they proved due diligence regarding hazardous rigging practices using embedded rebar, and the scope of their duties under the Act. The court found the essential elements of the counts proved and rejected the due diligence defence.

due diligence employer liability occupational health and safety regulatory prosecutions workplace safety

D. v. P.

2022 ONCA 76 (CanLII) · 2022-01-28

Employer Vicariously Liable for Employee's Travel Accident

This was an appeal to the Court of Appeal from a summary judgment motion about vicarious liability for an employee's car accident. The employee was driving to a distant job site when he caused an accident while making a short detour for coffee. The motion judge held the employer vicariously liable because the travel and the minor detour were authorized acts within the course of employment. The Court of Appeal upheld this decision, finding no error in the application of the Salmond test for vicarious liability.

vicarious liability employer liability scope of employment damages negligence

D. v. S.

2021 ONSC 3415 (CanLII) · 2021-06-25

This is a procedural ruling on a motion for summary judgment in a tort action alleging employer vicarious liability for an employee's negligence during a motor vehicle accident. The court determined that there was no genuine issue requiring a trial regarding whether the employee's actions, including a brief stop for coffee, were within the course of employment, and granted summary judgment on the liability issue.

employer liability scope of employment summary judgment vicarious liability

E. v. Simplicity Air Ltd.

2021 ONCA 409 (CanLII) · 2021-06-11

Vicarious Liability for Punitive Damages in Workplace Injury

This is an appeal from a jury verdict awarding punitive damages to an injured employee against their employer. The Court of Appeal for Ontario dismissed the appeal, upholding the employer's vicarious liability for supervisors' misconduct that contravened workplace safety legislation and was highly reprehensible. The court confirmed that contributory negligence does not reduce punitive damages and that the trial judge's instructions to the jury were adequate.

employer liability punitive damages vicarious liability workers compensation workplace injury

Ontario (Labour) v. Sudbury (City)

2021 ONCA 252 (CanLII) · 2021-04-23

OHSA Employer Liability: City of Sudbury Appeal

This appeal concerns the liability of the City of Sudbury as an employer under the Occupational Health and Safety Act for breaches of safety regulations. The Court of Appeal addressed whether the municipality assumed employer responsibilities by employing inspectors at a project site and whether the due diligence defence should be remitted for further consideration. This decision was appealed to the Supreme Court of Canada, which upheld it (R. v. Greater Sudbury (City), 2023 SCC 28). The Supreme Court of Canada dismissed the appeal on equal division, meaning the Court of Appeal's decision stands. The City is considered an employer under the Act and the matter of its due diligence defence is remitted to the provincial offences appeal court.

due diligence employer liability municipal employer occupational health and safety statutory interpretation

D.F. v. Toronto Parking Authority

2021 ONSC 1695 (CanLII) · 2021-03-08

Workplace Sexual Assault: Labour Arbitrator Jurisdiction

This is a jurisdictional decision determining whether a unionized employee's claims for workplace sexual harassment and assault fall within the exclusive jurisdiction of a labour arbitrator under the Labour Relations Act. The court affirmed that such claims arise from the collective agreement and do not violate the Charter, finding no remedial gap in the arbitration process.

charter rights employer liability jurisdiction labour arbitration workplace harassment

C. v. Workplace Safety and Insurance Appeals Tribunal

2021 ONSC 1149 (CanLII) · 2021-02-16

WSIAT Judicial Review: Course of Employment Bar

This is a judicial review of a Workplace Safety and Insurance Appeals Tribunal decision upholding the statutory bar on a civil action under section 28(1) of the Workplace Safety and Insurance Act, 1997. The Divisional Court found the Tribunal's determination that the applicant was injured in the course of employment and that Sargent Farms Limited was her de facto employer was reasonable.

employer liability judicial review scope of employment workers compensation workplace injury

Ontario (Labour) v. Sudbury (City)

2019 ONCA 854 (CanLII) · 2019-10-28

OHSA Employer Liability: Municipality & Due Diligence Appeal

This is a motion to the Court of Appeal for leave to appeal an acquittal under the Occupational Health and Safety Act. The Ministry of Labour charged the City of Greater Sudbury over a fatal construction accident, but the courts below acquitted the municipality after finding it was not an employer because it lacked control over the project. The Court of Appeal granted the motion for leave to appeal because the interpretation of an employer in municipal infrastructure projects raises an important question of law. Leave to appeal the acquittals was granted. The case later reached the Supreme Court of Canada (R. v. Greater Sudbury (City), 2023 SCC 28). The Supreme Court of Canada dismissed the appeal on equal division, meaning the Court of Appeal's decision stands. The City is considered an employer under the Act and the matter of its due diligence defence is remitted to the provincial offences appeal court.

due diligence employer liability municipal liability occupational health and safety statutory interpretation

B. v. S.

2019 ONSC 4914 (CanLII) · 2019-08-26

Workplace Harassment Damages: Emotional Distress & PTSD

This is a merits decision regarding a claim for damages arising from sexual harassment and attempted drugging by an employer. The court found the employer's conduct abhorrent and awarded $50,000 in general damages for emotional distress and $50,000 for loss of competitive advantage due to PTSD, while declining punitive damages due to a prior criminal sentence. The plaintiff was also awarded $30,000 in substantial indemnity costs.

damages employer liability mental distress sexual harassment workplace discrimination

M. v. Her Majesty the Queen in Right of Ontario

2019 ONSC 532 (CanLII) · 2019-02-07

Workplace Discrimination: Rule 21 Motion to Strike

This is a civil procedure decision regarding a Rule 21 motion to strike claims in an employment dispute involving constructive dismissal, discrimination, and harassment. The court addressed whether the plaintiff's allegations of discrimination based on age and disability, as well as harassment and intentional infliction of mental suffering, were sufficiently pleaded to establish liability against the employer and individual defendants. The plaintiff was granted leave to amend the statement of claim to address deficiencies, while the defendants were awarded partial indemnity costs.

constructive dismissal employer liability human rights code motion to strike workplace discrimination

Ontario (Labour) v. New Mex Canada Inc.

2019 ONCA 30 (CanLII) · 2019-01-18

Ontario (Labour) v. New Mex Canada - OHSA Sentencing

This is an appeal to the Court of Appeal from a provincial offences appeal judge's decision on sentencing under the Occupational Health and Safety Act. The employee died from a fall at work. The trial justice of the peace imposed a $250,000 fine on the corporate employer and 25-day intermittent jail sentences on its two directors. The appeal judge varied these to a $50,000 corporate fine and $15,000 fines per director. The Court of Appeal upheld the appeal judge's sentences, finding the original sentences demonstrably unfit and based on an error in principle, while clarifying the role of moral blameworthiness and deterrence in regulatory sentencing.

employer liability occupational health and safety personal liability procedure punitive damages standard of review workplace injury

A. v. Gallagher’s Garage Ltd.

2018 ONSC 4347 (CanLII) · 2018-07-30

This is a tort action involving a claim of negligence and personal injury against an employer, focusing on the standard of care owed by the employer.

employer liability negligence personal injuries workplace injury

Corporation of the City of Windsor v. M.

2018 ONSC 2055 (CanLII) · 2018-04-25

Judicial Review: Pay Equity Hearings Tribunal Decision

The Divisional Court reviewed a Pay Equity Hearings Tribunal decision challenging the City of Windsor and a union for violating the Pay Equity Act by reducing wages of a female-dominated job class. The court assessed the reasonableness of the Tribunal's interpretation of the Act, specifically regarding the maintenance of pay equity, the application of exceptions based on bargaining strength, and the scope of employer versus union liability for compensation adjustments.

employer liability judicial review labour relations pay equity statutory interpretation

R. v. Sunrise Propane Energy Group Inc.

2017 ONSC 6954 (CanLII) · 2017-11-27

Workplace Safety: OHSA Sentencing Appeal

An appeal against sentencing for an employer convicted of strict liability offences under the Occupational Health and Safety Act and Environmental Protection Act following a propane facility explosion that caused death and environmental damage. The court addressed the employer's failure to provide adequate instruction and supervision to employees, the rejection of due diligence and official error defences, and the appropriateness of the fines imposed given the aggravating factors.

due diligence employer liability ohsa sentencing workplace safety

R. v. Wal-Mart Canada Corp.

2017 ONSC 6726 (CanLII) · 2017-11-08

Workplace Safety: Hazard in Aisle

This is an appeal regarding a strict liability offence under the Occupational Health and Safety Act where an employee tripped on an empty skid in a workplace aisle. The court addressed whether the placement of the skid constituted a 'hazard or obstruction' under section 11 of Regulation 851 and whether the employer exercised due diligence. The trial judge's interpretation of the legislation was upheld on appeal.

due diligence employer liability hazard occupational health and safety workplace safety

I. v. L.

2017 ONCA 446 (CanLII) · 2017-06-02

I. v. L.: Vicarious Liability for Employee Assault

This was an appeal to the Court of Appeal from a summary judgment dismissing the plaintiff's claim against a taxi company. The plaintiff alleged she was sexually assaulted by a taxi driver while intoxicated and sued the taxi company for vicarious liability, negligence, and breach of fiduciary duty. The motion judge dismissed the claims, finding the taxi company was not vicariously liable for the driver's intentional torts absent fault, and the plaintiff failed to establish negligence or fiduciary duty. The Court of Appeal dismissed the appeal, agreeing that the alleged assault was not sufficiently connected to the employment risk to justify vicarious liability under the Bazley test.

employer liability fiduciary duties negligence sexual assault torts vicarious liability

G. v. CPNI Inc.

2015 ONCA 833 (CanLII) · 2015-12-01

ESA Deductions: Unpaid Wages Appeal

This is an appeal from a motion judge's decision in an employment standards action regarding unpaid wages and unauthorized deductions. The Court of Appeal addressed whether the employer had a valid defence under section 13(3) of the Employment Standards Act, 2000 for deducting wages due to unreturned company property, and whether the motion judge erred in refusing to stay enforcement of the employees' judgment pending a counterclaim for conversion.

contract interpretation deductions employer liability employment standards unpaid wages

D.K. v Nemato Corp.

2015 ONSC 6273 (CanLII) · 2015-10-09

Common Employment Doctrine Appeal: D.K. v Nemato Corp.

This is an appeal from a motion judge's decision on a Rule 21 motion to strike in a workplace injury claim involving the doctrine of common employment. The Divisional Court dismissed the appeal, finding it was not plain and obvious that the claim for common employment liability would fail, and upheld the costs order.

civil procedure common employment costs employer liability workplace injury