Owed no duty of care

By Alexander Gay September 24, 201824 September 2018

Owed no duty of care

 

There was a time when a public servant, who could count on employment for life, was expected to endure public criticism, while remaining silent and faithful to his or her political masters.  There was a good reason for this. Reputational interest is of little value to someone who enjoys guaranteed employment for life. 

However, that is all changing. A guaranteed life career as a public servant is not what it used to be. Pension benefits that once supported a career in public service are far less accessible, as the public service across Canada tries to align itself with the private sector.  

What’s more worrying is that government employers can now argue that they owe no duty to protect the reputational interests of its public servants accused of misconduct.  A recent decision from the UK Supreme Court illustrates how.

In James-Bowen & Ors v Commissioner of Police of the Metropolis , the plaintiff had brought a civil claim against the Commissioner, who was vicariously liable for the actions of police officers who had allegedly assaulted him. The officers, who were not parties to the claim, later brought a claim against the Commissioner for settling the case in a manner that did not safeguard their reputational interests and that compromised their professional interests.

The UK Supreme Court held that, in defending itself, the Commissioner did not have a duty to protect the reputational interests of the employees. Because an employer’s interests and those of its employees are not necessarily aligned, the Court held that the proposed duty of care to defend the reputational interests of the employees would conflict fundamentally with the (quasi) employer’s own interests in defending against a claim. It would not be fair, just or reasonable to impose such a duty on the employer. 

In Canada, the courts have yet to weigh in on this specific issue, and until they do it’s unclear what approach they’ll take. In the meantime, how this all plays out in real life is concerning.   In the public service, employers across al jurisdictions maintain indemnification polices where the employee receives the benefit of a Crown counsel in defending a civil claim.  The Crowns have deep pockets and they can self-insure in applying those indemnification policies, which are generally at the discretion the employer. The employee has little to say on the choice of counsel or the legal position taken on the various issues.   The lawyer defends the action on behalf of both the public institution, which is said to be vicariously liable for the action of the employee, and the employee that is alleged to have engaged in the misconduct.  Counsel will typically explain the common retainer to both parties. If there is a divergence of interest, counsel will cease to act for the employee and continues to act for the employer.   In such cases, the employee is often left with or without legal representation, depending on whether the employer is prepared to cover the cost of the private counsel for that employee.  Unions can decide to assist the employees, but they rarely do.   In the end, if the employee decides to part ways from a common defence because he or she believes their reputational interests are not being advanced, the employee is left to fund that aspect of the litigation.

In a situation where there is guaranteed employment for life, the public service employee can suffer some reputational damage with little economic consequence. But today, safeguarding a reputational interest speaks to future marketability and there are a number of consequences that have to be considered.   Assuming risks in the performance of one’s duties becomes problematic for both the employee and the employer.  The rational employee is paralyzed with accountability concerns and the employer is left with what may be a less efficient work force.  The James-Bowen ruling calls for a re-alignment of the indemnification policies of public servants or the inclusion of new employment terms that address the possible divergence between the employer’s interest and the reputational interests of its employees. 

Alexander Gay is General Counsel at the Department of Justice. He maintains a broad civil litigation practice, with an emphasis on commercial and trade disputes. He is also a part-time professor at the University of Ottawa (Faculty of Law) and the author of the Annotated Arbitration Act of Ontario, 1991. The author's views are his own.

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