Honda Canada Inc. operating as Honda of Canada Mfg. v. Kevin Keays

(Ontario) (Civil) (By Leave)


Labour Law - Master and servant.


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Employment law - Unjust dismissal - Punitive damages - Standards of review - Availability of punitive damages for wrongful dismissal if employer’s conduct was discrimination or harassment that breached human rights legislation - Relevance of principles applicable to contracts for peace of mind to punitive damages in an employment law context - Whether a trial judge should conduct independent research other than as to matters of law and, if so, what procedures are required? - Whether punitive damages award should be reduced on appeal without increasing compensatory damages; Whether discrimination and harassment should be a separate cause of action; Whether human rights legislation should be incorporated into individual employment contracts; Effect of proportionality on compensatory and punitive damage awards; Whether overriding and palpable error standard of review should be integrated with rationality standard of review.

The Respondent was employed by the Appellant. He began to suffer from Chronic Fatigue Syndrome. He received long-term disability benefits but the benefits were cancelled and he returned to work. He continued to experience intermittent absences. The Appellant advised the Respondent to apply for a program that exempted employees from attendance-related discipline. The Respondent saw a company physician. The employment relationship deteriorated. The Respondent retained counsel and his enrollment in the program offering exemption from discipline was cancelled. The Appellant demanded that the Respondent see another company physician. The Respondent requested more information on the purpose, methodology and parameters of the examination. The Appellant refused to provide further details and the Respondent refused to meet the doctor. The Appellant terminated the Respondent’s employment. The Respondent brought an action for wrongful dismissal. The Ontario Superior Court of Justice found that Keays had been wrongfully dismissed. On appeal, the Court of Appeal unanimously upheld the trial judge’s decision that Keays was wrongfully dismissed and entitled to 15-months’ notice. The majority reduced the award for punitive damages.