Lost Income – Special Damages - The Law of Workplace Sexual Harassment in Canada
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Lost Income – Special Damages

Lost Income – Special Damages

The determination of a lost income award under human rights law is much different from the claim made as a wrongful dismissal or breach of contract claim. This may lead to a more dramatic claim for lost income, or a much more modest claim, based on the context.

Make Whole

Under human rights legislation, the purpose of compensation is defined by the make whole concept. 1

In the Piazza decision referenced above, the Court of Appeal upheld the Board’s award of 11 weeks’ lost income after 10 weeks of employment. It stated that the purpose of compensation is to restore the complainant to the prior position that they “would have been in had the discriminatory [conduct] not occurred”.

As the remedy under the Code is restitutional in nature, the length of employment and the “quality” of employment are both irrelevant factors in the determination of the income loss. The Court of Appeal reversed the Divisional Court on this issue. 2

In Impact Interiors, the complainant had been employed for two days, at which time she quit due to the sexual harassing conduct of the employer. The Board of Inquiry ordered a lost wage claim of $17,000, which represented the difference between what she would have earned in her former job and what she actually earned. This award was reversed by the Divisional Court and again restored by the Court of Appeal.

It is clear that the wrongful dismissal implied term of reasonable notice is not the basis of determining the income loss in a human rights complaint.

As was stated by the Ontario Court of Appeal in Piazza v Airport Taxicab (Malton) Assn, (1989), 69 OR (2d) 281 (CA):

The purpose of the compensation [in human rights] is to restore a complainant as far as is reasonably possible to the position that the complainant would have been in had the discriminatory act not occurred. I find nothing in the language of the foregoing section which would import into it the limit on compensation which is imposed by the common law with respect to claims for wrongful dismissal.

Foreseeability is not the test for the determination of lost income under the statute where the statute allows for a lost income claim. 3

To establish a claim, there must be a causal link between the loss of income and the conduct in question. The test to be used for that purpose is the “but-for” test as in Walsh below or as referred to in Chopra below, “a causal link”. 4

The Ontario Court of Appeal used the same test in its 1989 decision in Piazza v Airport Taxi which stated that the purpose of compensation under the Code is to restore the complainants to the prior position that they: 5

“would have been in had the discriminatory [conduct] not occurred”

The quoted passage citing these words from Piazza comes from the later 1998 Ontario Court of Appeal decision of Impact Interiors, which had reversed the Divisional Court on this issue. The Court in Impact Interiors continued:

A measure of monetary damages is what the complainants would have earned had the discrimination not taken place.

These cases conclude that the lost income claim is based on the test set out above, namely, but for the employer’s adverse conduct, what income would have otherwise been earned? Such a test would look to the adverse conduct and determine if the loss of income is caused by such conduct. A termination, direct or constructive, caused by discriminatory conduct, would hence fit this test.

Hence, an applicant who proves a breach of the Code is entitled to compensation for wage loss arising out of the discriminatory act. Subsection 45.2 (1)1 of the Code directs the Tribunal to consider what loss arose “out of the infringement” of the Code when considering the proper amount of monetary compensation. 6

Decisions of the Ontario Tribunal and of its predecessor Boards of Inquiry have commonly considered an income loss arising from the date of the infringement of the Code to the date of the hearing. 7

The Tribunal does have discretion to limit the loss of income claim, apart from applying the concept of mitigation as discussed below, by the application of such discretion “on a principled basis”, as was stated by the Federal Court of Appeal in Chopra:

The fact that foreseeability is not an appropriate device for limiting the losses for which a complainant may be compensated does not mean that there should be no limit on the liability for compensation. The first limit is that recognized by all members of the Court in Morgan, that is, there must be a causal link between the discriminatory practice and the loss claimed. The second limit is recognized in the Act itself, namely, the discretion given to the Tribunal to make an order for compensation for any or all of wages lost as a result of the discriminatory practice. This discretion must be exercised on a principled basis.

Prospective Lost Income

There is no doubt that the Tribunal has the jurisdiction to make an award for a future loss. The plea of reinstatement, while preferable, is not mandatory to allow for a prospective income loss beyond the date of hearing. 8

The Board of Inquiry made an award for future loss in McKee v. Hayes-Dana Inc. (1992), 17 C.H.R.R. D/79, an age discrimination case. McKee was approaching age 65 at the time of the hearing, which resulted in a prospective award of at least 18 months beyond the date of hearing.

The Tribunal has recently stated that such an order for future loss would be made in only an unusual context: 9

As noted by the respondent, the Tribunal has not yet made an order of post-hearing wage loss.  In my view such an award would be extraordinary and not likely to be made except in exceptional circumstances.  One reason for this conclusion flows from my view that the obligation of the applicant to mitigate his or her damages runs together with a claim to damages for lost wages.  It is obviously impossible to assess an applicant’s ongoing efforts to mitigate a wage loss post hearing.  As such, any award of post-hearing damages for lost wages would be almost entirely speculative in the majority of cases.


Future Loss in Lieu of Reinstatement

The Divisional Court has upheld an award for future loss in lieu of reinstatement in circumstances where the arbitrator had determined reinstatement was not a workable order. 10

A similar conclusion was reached in the unjust dismissal case under the Canada Labour Code in Mathur v Bank of Nova Scotia (Armstrong). The adjudicator determined that reinstatement was not an appropriate remedy and hence awarded compensation through to Mathur’s retirement age, albeit on terms requiring Mathur to report on his mitigation efforts during the prospective period from the date of the award of May 2, 2002 through to the date of retirement of July 22, 2003.


As a general rule, it would appear that the complainant remains under an obligation to take reasonable steps to seek out comparable employment, as is the case in common law wrongful dismissal actions. 11

There are some inroads suggested in this principle as discussed below which reflect the considerable discretion given to the tribunal and that the human rights process is not required to march lock step with common law principles.

The onus is upon the employer to prove a failure to mitigate. 12

The Tribunal, may in the exercise of its discretion, apply the common law concepts of mitigation, but it is not mandated to do so. 13

Mitigation Expenses

Mitigation expenses have been allowed where it has been determined that the expense was reasonably incurred.

A successful claim for travel costs has been allowed, to compensate for additional travel costs incurred in her new position of employment for the time period of October 1, 2009, her last active date of employment, through to July 2010. 14

Job search expenses have also been allowed. 15

Moving expenses from Toronto to Ottawa were allowed in in Abouchar v Metropolitan Toronto School Board (1999) 35 CHRR D/175 (Laird) , and similarly in Moffatt v Kinark Child and Family Services (Laird) and also in Sandford v Koop (Gottheil)

Human Rights Claims Limited in Impact

All this being said, the claim for lost income as a human rights remedy may be much more modest that a common law action in contract. This issue is reviewed in a subsequent review.



  1. Ontario Court of Appeal  Piazza v Airport Taxicab,  (1985), 7 C.H.R.R. D/3196 (Ont. Bd. Inq.), var’d 24 O.A.C. 8 (Div. Ct.), rev’d 60 D.L.R. (4th) 759 (C.A.) (referenced in Ontario Human Rights Commission v Impact Interior
  2. Ontario Court of Appeal – OHRC v Impact Interiors 
  3. Alberta Court of Appeal in Walsh v Mobil Oil; The Federal Court of Appeal, in Chopra v Canada, 2007 FCA 268 (CanLII), 2007 FCA
  4. Alberta Court of Appeal Walsh v Mobil Oil; Federal Court of Appeal Chopra
  5. OCA in Piazza v Airport Taxi
  6. Ontario Human Rights Tribunal Chittle v 1056263 Ontario (Keene); Ontario Human Rights Tribunal Norrenda v Primary Response (Keene)
  7. Ontario Human Rights Tribunal Chittle v 1056263 Ontario (Keene); Ontario Human Rights Tribunal Norrenda v Primary Response (Keene)
  8. McLean v DY4 Systems (Keene)
  9. Pilon v Cornwall (Muir)
  10. Greater Toronto Airports Authority v PSCA Local 0004
  11. OCA – Piazza
  12. Payette v Alarm Guard Services (Dimovski)
  13. Federal Court of Appeal – Chopra; British Columbia Supreme Court – McIntosh v Metro Aluminum Products 
  14. Xu v Ottawa Hospital
  15. DeSousa v Gauthier (DeGuire)

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