Doing Nothing (About Psychological Safety Risks)Gets a Manager in Trouble - Again.
Kelly VanBuskirk, KC, PhD, C. Arb.
A July 2026 BC court decision teaches every manager a crystal clear lesson in how to avoid (or attract) liability risk.
In Kedrick v Johnston Meier Insurance, an insurance sales employee became the victim of a stalker. The stalker was a representative of one of the employer’s clients, and so the stalker had business reasons to contact the sales employee. However, the stalker took things a lot further than that: he showed up at the employee’s workplace unnecessarily, he waited for her in the company parking lot, and he was even seen loitering near her home. You might think that this is an unusual workplace problem, but not really.
The employee told the company about the stalking. She acknowledged that it was tricky – the police weren’t able to do anything, and the stalker was a client of the company. There was a risk that the company would lose revenue (and the employee would lose variable pay) if the stalker terminated his contract.
The company didn’t take effective action in respect of the stalking, and the employee ended up on Workers’ Compensation benefits as a result of PTSD arising from the workplace safety issues. When it became apparent that the employee would no longer be medically able to do her job, the company terminated the employment relationship – thinking it could rely on the doctrine of frustration of contract. However, the doctrine of frustration doesn’t work that way, because it requires that the supervening event that fundamentally changes the employment relationship (in this case, the employee’s PTSD) is neither the employee’s nor the employer’s fault. Here, the court found that the employer was at fault for failing to properly address the stalking problem.
The biggest lesson for employers is not found in the application of the doctrine of frustration, even though that’s what many of the law commentators are focused on. Instead, the most important point is that the employer’s management (including the HR manager) were unable to credibly testify about the steps they took to address the employee’s expression of concern regarding the stalking issue. In the case of the HR manager’s testimony, these missteps are worth noting:
1. False origin story. In direct examination, the HR manager said she first learned of the stalker from the employee. In cross-examination, she admitted that she'd actually learned of it earlier, from a different employee, and that she took no action on that earlier information.
2. Misrepresented the reason for her intervention. The HR manager testified that she got involved with the employee because of the stalker but conceded that the employee had actually raised concerns about bullying by her manager, not the stalker.
3. Chilling language. The HR Manager acknowledged using language suggesting that the employee’s Workers’ Compensation complaint was tantamount to "suing" the company, language that could discourage a legitimate complaint.
4. No real investigation. When pressed on whether she investigated the bullying complaint against the employee’s manager, the HR manager "hesitated and appeared flustered" and could not provide specifics, merely asserting she was "sure" she'd responded.
5. Shifting justification for termination. In direct, the HR manager suggested the company relied on both WorkSafeBC in deciding to terminate. In cross-examination, she admitted the actual trigger was a third, September 13 letter — and that she never contacted Hedrick before terminating her.
The Court's conclusion: The court concluded that the HR manager’s evidence was "internally inconsistent and, at times, inconsistent with the objective evidence." Despite an initially defensive approach to protect the company, her own cross-examination answers ended up confirming she did little to address the bullying complaint, that the manager’s conduct contributed to the employee’s job loss, and that the HR manager didn’t explore accommodation before termination.
Hedrick v Johnston Meier Insurance Agencies Ltd., 2026 BCSC 1250 (CanLII), https://canlii.ca/t/klwl6