Failure To Vaccinate Can End Employment Without Notice

In a recent decision¹, the Ontario Superior Court of Justice found that an employer had no obligation to provide notice of termination where an employee failed to vaccinate against COVID- 19. While the employment relationship was formally terminated by the employer, the court concluded that the relationship had become "frustrated" and the employer was entitled to treat the contract as being at an end without an obligation to provide any notice of termination at common law.

What happened?

The employee was employed as a systems technician for VuPoint Systems Ltd., a business that provided television and smart home installation services on behalf of Bell Canada and Bell ExpressVu (collectively, "Bell"). More than 99% of VuPoint's income came from Bell, and the employee's work with VuPoint only involved installation services for Bell.

In early September 2021, Bell implemented a policy that required technicians to have two doses of an approved COVID-19 vaccine to continue performing installation services. Notably:

1. Bell's policy did not permit any alternatives to vaccination, such as rapid testing; and
2. the policy also stated that a failure to comply with the policy would constitute a breach of the supply agreement between Bell and VuPoint.

Consequently, VuPoint implemented a vaccination policy of its own, requiring its installers to be vaccinated against COVID-19. VuPoint's policy did not state that a termination of employment would result from non-compliance; however, the policy stated that unvaccinated employees would be prohibited from performing work for Bell.

The employee failed to provide VuPoint with proof of vaccination, and as a result, VuPoint provided him with two weeks' notice of termination. The employee responded by stating that he would not disclose his vaccination status due to privacy laws. He also stated that VuPoint was discriminating against him for his decision to be unvaccinated (an argument that many employees in Canada had raised when employers began to implement mandatory vaccination policies).

Following the termination, the employee brought a court action claiming that he had been wrongfully dismissed from his employment with VuPoint (i.e. that he was entitled to more than two weeks' notice of termination).

What did the Court decide?

The Court rejected the employee's claim and concluded that he was not entitled to notice of termination.

The employee had confirmed that he had no intention of ever becoming vaccinated, notwithstanding that this would prevent him from performing all of his work for VuPoint. As a result, the Court found that the employee lacked a necessary qualification to perform the duties of his position.

Applying the Supreme Court of Canada's established law on frustration of contract, the Court concluded that VuPoint was entitled to treat the employment contract as being at an end, with no obligation to continue the employment relationship or provide notice of termination at common law. The Court also found that VuPoint was not required to modify the employee's contract to ensure he could continue working.

In addition, the Court noted that Bell's vaccination policy, and the pandemic generally, could not have been foreseen at the time the employment relationship began and that neither the employee or VuPoint had defaulted on their obligations.

Takeaways

The decision confirms that, in specific circumstances, an employee's refusal to comply with COVID-19 vaccination requirements can result in the end of the employment relationship without any entitlement to notice of termination.

However, where an employee has failed to comply with those requirements, employers should not be quick to assume that they have the right to treat the employment relationship as at an end. The decision was fact-specific in that:

1. the Court specifically noted that the circumstance which led to the frustration was Bell's vaccination policy (the actions of an unrelated third-party), as opposed to the failure of the employee to become vaccinated; and
2. the Court found Bell's vaccination requirement parallel to previously established "frustration" scenarios, such as the scenario where an employee was not legally allowed to work without a certain level of security clearance.

Whether any given situation will reach the threshold for frustration, which the Court describes as a "radical change" to the employment contract, is dependent on the circumstances. The Court has not yet opined on other circumstances where failure to comply with a vaccination policy might similarly meet the threshold for frustration.

Footnote

1. Croke v VuPoint Systems Ltd., 2023 ONSC 1234

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