The Alberta Human Rights Tribunal ("Tribunal")
released a decision this month that considered whether the terms of
a Release Agreement constituted a valid and enforceable settlement
of an employee's allegations of human rights discrimination
arising from employment.
In Hutton v ARC Business Solutions Inc, 2015 AHRC 7,
the employee signed an Employee Termination Notice (the
"Release") that offered severance pay as "full and
final settlement of any and all claims for compensation with
respect to the termination of [the employee's]
employment." After signing the Release, the employee filed a
human rights complaint with the Alberta Human Rights Commission.
The issue before the Tribunal was whether the Release was a waiver
of the employee's right to make a human rights complaint
arising from her termination.
When determining whether settlement agreements in human rights
complaints are valid and enforceable, there are a number of factors
that may be considered: 1
The actual language of the release itself as to what is
included, explicitly or implicitly;
Unconscionability, which exists where there is an inequality of
bargaining power and a substantially unfair
Undue influence, which will usually be made out where there has
been an improper use of coercion, oppression, abuse of power or
authority, or compulsion in order to make the other party
The existence of independent legal advice;
The existence of duress (not mere stress or unhappiness), as
well as sub-issues of timing and financial need;
The knowledge of the party executing the release as to their
rights, and potentially, the knowledge of the party receiving the
release that a potential human rights complaint is contemplated;
Other considerations, which may include lack of capacity,
timing of the complaint, mutual mistake, forgery, and fraud.
In Hutton, the mere fact that the compensation paid to
the employee upon termination exceeded the statutory minimum
requirement was not sufficient to establish that
"compensation" included damages arising from a human
rights complaint. Significantly, the Tribunal found that there was
no indication in the actual language of the Release that it
contemplated a release or waiver of any alleged human rights
While it is possible to release liability for past acts of
discrimination in a termination notice, the language must be
considerably more specific than the release language used in
Hutton. A specific clause that acknowledges release of
liability for any past acts of discrimination under human rights
legislation is more likely to be upheld and prevent the
continuation of the human rights complaint. 2
The language used in the Release must therefore reference more
than simply issues of "compensation." In Hutton,
the remaining factors listed abovewere also considered and
reinforced the Tribunal's conclusion that the language in the
Release did not extend to release the employer from liability
related to the employee's human rights complaint. As such, the
Tribunal concluded that the Human Rights Commission had authority
to continue with the complaint.
Employers seeking to rely on releases or settlement agreements
that include a release of liability for human rights violations
should utilize clearly worded clauses that specifically acknowledge
release of liability for past acts of discrimination. Field
Law's Labour and Employment Group can advise and assist
employers with respect to drafting and reviewing comprehensive
releases and other matters related to human rights.
1 As set out by Justice Rooke in Chow v Mobil Oil
Canada, 1999 ABQB 1026 at para 104.
2 See, for example, Stergiou v Apache Canada
Ltd, 2015 AHRC 1 at para 20.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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