THE EMPLOYERS' EDGE
On Duty with Diapers: Supreme Court of Canada Finds an Employer Policy Providing Fewer Pension Benefits to Women with Childcare Obligations is Discriminatory
In Fraser v. Canada (Attorney General), 2020 SCC 28 (“Fraser”), the Supreme Court of Canada put the interpretation of the right to equality guaranteed by s. 15(1) of the Canadian Charter of Rights and Freedoms (the “Charter”) to the test. The Supreme Court considered an allegation of discrimination where a pension plan policy had a disproportionate impact on female RCMP members with children.
While this decision is concerned with the Charter (which would be limited to equality rights in government agency employment) the Supreme Court’s decisions in Charter cases often have an influence on the meaning of “equality” in subsequent provincial human rights cases. As such, the Supreme Court’s broad interpretation of the equality rights in s. 15(1), could have far-reaching implications for public and private sector workplaces and beyond.
The claimants were three retired female members of the RCMP who took maternity leave in the 1990s. Following their respective leaves, they experienced significant difficulties meeting work obligations and childcare responsibilities. As a solution, they participated in a job‑sharing program where they could collectively share one full‑time position. The three claimants who enrolled in the job‑sharing program, and the majority of the other RCMP members who job‑shared, were women with children.
Members of the RCMP receive benefits upon retirement from a pension plan. Gaps in a member's record of service, such as unpaid leaves, may be filled in through a buy-back process, leaving the member's pension benefits unaffected. However, no buy-back option was available to full-time members who temporarily reduced their working hours under a job-sharing agreement.
The claimants initiated an application arguing that the pension consequences of job‑sharing have a discriminatory impact on women contrary to s. 15(1) of the Charter. For reference, s. 15(1) of the Charter provides as follows:
Every individual is equal before and under the law and has the right to the equal protection and equal benefit of the law without discrimination and, in particular, without discrimination based on race, national or ethnic origin, colour, religion, sex, age or mental or physical disability.
The S. 15(1) Test
To prove a prima facie violation of s. 15(1), a claimant must demonstrate that:
- the impugned law, on its face or in its impact, creates a distinction based on enumerated or analogous grounds; and
- the impugned law poses burdens or denies a benefit in a manner that has the effect of reinforcing, perpetuating, or exacerbating disadvantage.
The claimants argued that the negative pension consequences of job‑sharing infringed s. 15(1) because they have an adverse impact on women.
History of the Case
The application judge found job-sharing was part-time work for which participants could not obtain full-time pension credit. The Federal Court of Appeal found any adverse impact on job-sharing participants flowed from their choice to work part-time, not from the pension plan. The claimants’ ultimately appealed to the Supreme Court of Canada.
Decision by the Supreme Court of Canada
The Supreme Court allowed the appeal in a 6-3 decision, finding that the pension policies violated the Charter.
The Majority Decision:
In analysing the test for a violation of s. 15(1), the majority found:
- Full-time RCMP members who work regular hours, who are suspended, or who go on unpaid leave can obtain full pension credit for those periods of service under the pension plan. Whereas, full-time members who temporarily reduce their hours under a job-sharing agreement are classified as part-time workers under the Regulations and are unable to acquire full-time pension credit for their service. This created a distinction based on sex for the purposes of the Charter because women were disproportionately impacted by the rules; and
- This adverse impact perpetuates a long‑standing source of disadvantage to women, as pension plans have historically been designed for full‑time employees with a male pattern of employment. The use of a temporary reduction in working hours as a basis to impose less favourable pension consequences plainly has a disproportionate impact on women.
The reasons of the minority Justices demonstrate a significant disagreement regarding the equality rights protected in the Charter.
Two of the Three Dissenting Justices (Brown and Rowe):
Two of the three dissenting Justices argued that it is not arbitrary or unfair (and therefore not discriminatory) for an employer to prorate compensation, including benefits, according to hours worked when this responds to employees’ actual capacities and circumstances.
Further, they opined that the pension plan did not represent a source of ongoing systemic disadvantage as it did not contribute to women’s systemic disadvantage; nor did it reinforce, perpetuate, or exacerbate the pre‑existing disadvantage of women in the workplace which arises in part from unequal distribution of parental responsibilities.
The Third Dissenting Justice (Côté):
The third dissenting Justice argued that the claim failed at step one of the s. 15(1) analysis because the impugned provisions of the pension plan did not create a distinction on the basis of sex. In her opinion the claim is on behalf of women with children, and not simply women. It is critical that the claimants had caregiving responsibilities that made them decide to job‑share. The statistics show that women are disproportionately affected — given that the majority of job‑sharers are women with children — but, to Justice Côté, this is insufficient to say that step one of the s. 15(1) analysis has been met.
The majority’s decision in Fraser suggests that employer policies, which appear to be neutral, could be attacked as discriminatory if they do not sufficiently address systemic inequality. The competing reasoning of the Justices demonstrates the differences in opinion in the application of the Charter provisions protecting equality.
Family/caregiver status is not a protected ground in the Charter and the majority held that whether family/caregiver status should be protected under the Charter did not need to be decided in this case. However, it is noteworthy for private Ontario employers that “family status” is a protected ground under the Ontario Human Rights Code (the “Code”). This decision found a disproportionate impact on women, whereas Ontario employers in similar cases governed by the Code would face another hurdle of trying to show that their employer policies do not discriminate on the ground of family status.
This case illustrates the importance of considering the impact of workplace policies. Seemingly neutral policies can have an adverse impact on certain groups of people and these policies might be found discriminatory. Further, longstanding company policies may be discriminatory as new statistics and shifting public awareness towards adverse treatment bring to light the disproportionate impact of policies on vulnerable groups.
It is imperative for employers to draft policies that will not produce adverse impacts on vulnerable groups, and it is just as important to ensure that current policies avoid discrimination. Contact a member of the CCPartners team for expert advice on all employment-related policies.
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