White employees at B.C. resort get $200,000 for race discrimination

Chinese owner said he wanted to get rid of white employees, then brought in cheaper Chinese workers to do their jobs
By Jeffrey R. Smith
|Canadian Employment Law Today|Last Updated: 03/06/2019

A British Columbia resort and its Chinese owner must pay almost $200,000 in damages for race discrimination to seven Caucasian workers who quit or were fired over a couple of days and were replaced by Chinese workers, the B.C. Human Rights Tribunal has ruled.

Spruce Hill Resort is a wilderness resort in rural British Columbia that includes cabins, motel rooms, restaurants, a spa, and fitness facilities. In 2015, Kin Wa Chan purchased the company that owns Spruce Hill and assumed control of the resort. Soon after, the resort scheduled renovations starting in January 2016 that would last about six months. Because of the renovations, Spruce Hill had to run at reduced capacity and laid off some employees as a result.

Melonie Eva began working at Spruce Hill as the general manager in January 2016 at the start of the renovations. She was responsible for the daily operations of the resort and finding contractors for the renovations. However, all hirings and projects had to be approved by Chan, who signed the company cheques.

Owner wanted Chinese workers

In March, Chan told Eva that he wanted to bring Chinese students to Spruce Hill for work experience. He asked Eva to work through an intermediary who would help secure Chinese investors as well as find and help Chinese students to immigrate to Canada to work at the resort. Over the next few months, Chan said that he wanted to replace Caucasian employees with ethnic Chinese workers to reduce labour costs, emphasizing that “Chinese workers are better and cheaper than white workers” and they didn’t have to be paid holiday pay or for overtime worked.

Eva wasn’t the only employee to hear Chan make these comments. Clare Fast, who ran the fitness department before the renovation and worked in administration and human resources during the resort's renovation, also heard them, as did several other employees. Chan usually wasn't discreet when making such remarks.

In early May, Eva had a fight with Chan because contractors had walked off the job after not being paid and Chan said again he wanted to bring in Chinese investors and workers. He also said he was losing money and didn’t want to pay overtime or public holiday pay, which he wouldn’t have to do with Chinese workers because they would work on salary. Eva reminded him that labour laws required him to pay everyone for overtime and public holidays. However, Chan said he wanted “white people gone” and some of his Caucasian employees were costing him too much money.

A Chinese student named Holly was hired in the summer of 2016 and performed the job duties that two Caucasian employees had been performing — Fast and a bookkeeper, Kathy Stocks. Chan introduced Holly to Stocks and told her she would be taking over her job in bookkeeping, so afterwards Stocks asked Eva what was happening. Eva told Stocks she should continue working at the front desk, but Stocks cleared out her things and went home. However, she returned to the front desk the next day because she couldn’t afford to be out of work.

Holly was also asked to serve food at a catered event, performing the duties of another Caucasian employee who was a waitress and manager of the resort’s café.

Three other male Chinese students were hired soon after and they began performing duties normally done by several white employees.

Chan complained to Eva that Stocks and Fast were costing him too much money, they “must go,” and he wanted more Chinese people.

Chan changed the schedule for the August long weekend so only Chinese salaried employees worked with no hourly employees — who were mostly Caucasian — as he still believed he didn’t have to pay salaried workers overtime or holiday pay. Chan said there were no non-Chinese salaried workers he could schedule, though Eva was paid by salary.

Several Caucasian workers arrived for work on the Tuesday after the long weekend to find the kitchen in a mess. Chan asked them to clean the kitchen as there had been an event that he and two Chinese workers had catered. This led to an argument between Chan and Eva, with Chan ultimately telling her he was now in charge and she was longer to speak to any of the employees and guests.

Later that day, a new schedule was posted with most of the shifts of the Caucasian employees removed. Chan justified the change as giving more hours to the salaried workers to save costs.

Over the next two days, Eva, Fast and four other Caucasian employees were either dismissed or quit. Stocks didn’t work that week, but on her first day back at work a week later she resigned. Soon after, all seven workers filed a human rights complaint alleging discrimination based on race because they were terminated or forced to resign because they weren’t Chinese.

In addition, Eva filed a complaint of sexual harassment against Chan stemming from an April 2016 business trip to China to purchase supplies for the renovation. Chan wanted to share a room the first night when they were staying in an upmarket hotel — a room where the bathroom was only separated by a wall of glass. They had an argument, during which Chan told Eva he wanted to save money and “in China, we do things the Chinese way.” Eva told Chan she was going back to the airport to fly home, but Chan apologized for the misunderstanding and found her another room. However, Eva didn’t believe Chan and thought he wanted sexual favours — her fears were further stoked when Chan walked her through a market selling sex toys on the way back to the hotel. They stayed in separate rooms the rest of the trip and Chan didn’t make any advances towards her.

Adverse impact

The tribunal noted that the employees identified themselves as Caucasian and Chan repeatedly referred to them as such, as well as “white.” As a result, they were protected under the B.C. Human Rights Code for their race. In addition, the tribunal found they had reason to believe they had a future working at the resort, and the end of their employment — whether they quit or were dismissed — had an adverse impact on them.

The tribunal found that Chan hired Chinese employees because he believed they would work for less and not claim their statutory entitlements to overtime and holiday pay. While his stated reason was to reduce costs, the fact was all his hires were Chinese and all the employees who had their hours reduced or were terminated were Caucasian — and Chan could provide no reasonable explanation for why the new Chinese workers were hired and were given the duties of the Caucasian workers, said the tribunal.

The tribunal pointed to evidence that Chan advertised for positions on a Chinese language job website but put out no English advertisements. And all of the employees involved in the human rights complaint reported hearing Chan make comments repeatedly about how he wanted Chinese workers and to get rid of white employees.

The tribunal determined that Eva, Fast, Stocks, and the other employees who left Spruce Hill were discriminated against because of their race. Race played a role in the decision to terminate those who were dismissed, and those who resigned were constructively dismissed because of their race, said the tribunal.

The tribunal also found Chan’s explanation for the business trip incident with Eva as a misunderstanding and he only wanted to share a room to save money wasn’t credible, as the hotel was a fancy one and Chan paid for all aspects of Eva’s trip, including spending money. In addition, Chan booked a room with only a glass divide for the bathroom and took her through a market selling sex toys. Regardless of Chan’s intentions, Eva found Chan’s conduct “sexual and unwelcome” and she was in a position of vulnerability, being in a foreign country with her boss, late at night, after an exhausting day of travel. Chan “exploited these power dynamics” and the incident qualified as sex discrimination under the B.C. Human Rights Code, said the tribunal.

Chan and Spruce Hill Resort were ordered to pay more than $113,000 to Eva and the other employees for loss of wages because of the discrimination — more than $47,000 of it to Eva — and $60,000 in damages for injury to dignity, feelings, and self-respect — $18,000 of it to Eva.

For more information see:

Eva obo others v. Spruce Hill Resort and another, 2018 CarswellBC 2902 (B.C. Human Rights Trib.).

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