The Supreme Court of Canada recently grappled with issues of adverse effect discrimination and gender equality in the context of a government job-sharing program, and the treatment of job-sharing under a statutory pension plan. In Fraser v. Canada (Attorney General), 2020 SCC 28, the Court held that the RCMP pension plan's treatment of job-sharing work breached the Canadian Charter of Rights and Freedoms because it had an adverse impact on women with children.
Although focused on the Charter equality rights of women employed by a government agency in respect of their employment and related retirement benefit entitlements, the Supreme Court's decision in Fraser has potentially far-reaching implications for employers more generally, as explained below.
The claimants were three retired female RCMP members, each of whom had taken maternity leave in the 1990s and then returned to full-time duties. On returning to work, each claimant experienced difficultly balancing full-time RCMP duties, childcare, and other responsibilities. In 1997, the RCMP introduced a job-sharing program, which allowed two or more RCMP members to split the duties and responsibilities of one full-time position for a limited or fixed time period, at reduced pay. The job-sharing program introduced greater flexibility for RCMP members, as it provided an alternative to taking leave without pay. It also helped the RCMP to retain trained members, and to address staffing shortages. Each of the claimants elected to participate in the job-sharing program. In general, job-sharing participants were mostly women with young children.
The claimants believed that their job-sharing services should be purchasable under the RCMP pension plan's buy-back provisions, which allow full-time members who have been suspended from work or have unpaid leaves to buy-back all or a portion of those periods. While the RCMP at first signified agreement with that view, the RCMP ultimately informed the women that work under the job-sharing program was equivalent to part-time work, for which no buy back was available under the RCMP pension plan.
The claimants brought an application in the Federal Court arguing that the pension consequences of job-sharing have an adverse impact on women contrary to s. 15(1) of the Charter. The Federal Court dismissed the claimants' Charter application. It held that job-sharing was a form of part-time work for which participants could not obtain full-time equivalent pension credits. The Federal Court held that this outcome did not violate s. 15(1) of the Charter because there was insufficient evidence that job sharing was disadvantageous compared to unpaid leave. The Federal Court of Appeal dismissed the claimants’ appeal.
Supreme Court Decision
The Supreme Court held that the RCMP pension plan's treatment of the job-sharing program met the twofold test for prima facie violations of s. 15(1) of the Charter. The RCMP pension plan, which was established through federal legislation (thereby engaging the application of the Charter, unlike a private pension plan), created a distinction based on sex, and imposed a burden or denied a benefit in a manner that has the effect of reinforcing, perpetuating or exacerbating disadvantage. The job-sharing program involved a temporary reduction in working hours for full-time staff members and was not equivalent to part-time work. Since job-sharing, unlike suspensions and unpaid leaves of absence, could not be fully purchased under the RCMP pension plan's buy-back provisions, the job-share participants had to sacrifice pension benefits. Because job-share participants were predominately women, that treatment had a disproportionate impact on women. Though these consequences were not explicitly based on sex, the Court found this situation to be adverse impact discrimination, which can arise where a seemingly neutral law has a disproportionate impact on members of a group protected under the Charter.
The Court held that federal government had not identified a pressing and substantial policy concern, purpose or principle that explained why job-share participants should not be entitled to buy-back full-time pension service, and that the discrimination could not therefore be justified under s. 1 of the Charter. On the remedy issue, the Court left it to government to develop a methodology for facilitating buy-backs, noting that such remedial measures should have retroactive effect, both for the claimants and for others who are similarly situated.
For employers, and for administrators of pension, benefits, compensation and incentive plans and arrangements, Fraser raises several significant issues:
- Application to Human Rights Regime – Although Charter claims are specific to the laws, policies and conduct of governments, discrimination claims under the Charter have analogues in federal and provincial human rights legislation, and the Court's approach to adverse impact discrimination and substantive equality rights in Fraser might be relied on in future human rights disputes involving private employers.
- Risk of Inadvertent Adverse Impact Discrimination – The decision highlights how the design of a plan or arrangement, even if ameliorative in purpose, may carry inadvertent risks of adverse impact discrimination. Employers should carefully consider these risks and take appropriate action to make changes in other programs or policies.
- Go the Distance with Policies and Accommodation Efforts – Fraser stands as a caution that employers should to take the extra step to consider whether the policy change doesn't just "narrow the gap" but "closes the door" to systemic inequality. Not going the distance may leave a program, which has been implemented in a good faith effort to accommodate employees, potentially open to challenge under human rights legislation (or under the Charter in the case of a government plan, policy, program or arrangement).
- Identification of Appropriate Comparator Group – The decision leaves some open questions respecting the appropriate comparator group to be used for identifying whether distinctions are being made on prohibited grounds.
- Ability to Identify Issues in Advance – Fraser depended on historical evidence obtained on job-sharing program participation, which showed that the participants were predominately women. In other cases, there could be challenges with identifying adverse impact discrimination situations before particular programs or initiatives are put into effect.