Williams HR Law LLP

A Costly Reminder on the Importance Of Conducting an Impartial Workplace Investigation

January 12, 2022

In the recent decision of McGraw v Southgate (Township) [McGraw], the plaintiff was wrongfully dismissed from her employment based on unfounded, sexist allegations and gender-based discrimination. Justice Chown of the Ontario Superior Court of Justice (“Court”) found the defendants’ conduct “discriminatory and reprehensible,” and the Court awarded Ms. McGraw moral damages, damages for sex discrimination under the Ontario Human Rights Code (“OHRC”), damages for defamation, and punitive damages in the amount of $190,000. Moreover, the Court awarded Ms. McGraw damages representing 6 months’ pay in lieu of reasonable notice of termination.


The plaintiff, Melanie McGraw, was a 10-year employee working as a part-time administrative assistant and a volunteer fire captain with the Dundalk Fire Department (“DFD”). The DFD is operated by the defendant, the Township of Southgate. David Milliner is the chief administrative officer of Southgate.

On February 7, 2019, Mr. Milliner terminated Ms. McGraw without cause, both as a fire captain and a part-time administrative assistant, because she was the subject of several rumours in the workplace. The defendants relied predominantly on hearsay evidence – which they believed to be true – that was characterized as rumours.

Some of these rumours, amongst other things, were that Ms. McGraw:

  • sent nude and provocative photos of herself to various male firefighters;
  • had several affairs with various male firefighters, including the fire chief;
  • sent text messages of a sexual nature to a male firefighter;
  • caused other firefighters to quit their jobs despite the known fact that it was difficult to retain volunteer firefighters;
  • caused morale problems in the workplace;
  • offered to give passing grades to male firefighters if they had sex with her; and
  • helped a firefighter cheat on a test.

Mr. Milliner conducted the internal investigation on behalf of the municipality. The Court noted significant issues in the way the investigation was conducted, namely that the investigation did not include any discussion or interview with the plaintiff, Mr. Milliner never obtained or saw any of the inappropriate photos that were allegedly circulated, he never spoke to a single person who had seen the photos first-hand, and he did not produce a single witness statement despite the finalized investigation report making references to statements, amongst other procedural shortcomings.


In the scathing decision, the Court stated that Mr. Milliner came to incorrect conclusions because he relied heavily on inaccurate and dated second-hand information; none of these rumours turned out to be factually correct. Although Mr. Milliner made the decision to terminate Ms. McGraw’s employment, the Municipal Council was ultimately held responsible because its members unanimously approved the decision made by Mr. Milliner.

The Court went on to say that the allegations against Ms. McGraw were made in a male-dominated environment and “the behaviour calls to mind a different era. It has long been recognized that this type of behaviour has no place in the workplace. Male dominated workplaces, in particular, must be mindful to avoid gender-based discrimination. The fact that Ms. McGraw was in a position of authority and therefore a potential target for sexist behaviour and rumours was lost on the defendants”.

In addition, the Court said that “it is generous to call what Mr. Milliner did an ‘investigation.’ For the most part, information came to him as opposed to him gathering information.” The Court went on to say that Mr. Milliner conducted an “amateurish investigation” where he conflated gossip with facts, and “he failed to recognize the patent gender-based discrimination directed at Ms. McGraw.”

The Court awarded to Ms. McGraw moral damages to compensate for mental distress arising from the manner of the termination, OHRC damages to compensate for injury to dignity, feelings and self-respect arising from discrimination, damages for defamation to compensate for injury to reputation caused by the offending statements, and punitive damages that primarily reflect the need for denunciation and deterrence.


Employers must be careful to select an appropriate investigator in any workplace investigation. An investigator without the requisite investigative skills and knowledge can undermine the entire investigation process and potentially create additional liability for an employer.

Depending on the nature of the allegations, it may be appropriate for the employer to conduct the investigation internally. However, while internal investigators may be more suitable for straightforward investigations such as in cases of poor work performance, minor workplace policy breaches, or interpersonal misunderstandings amongst colleagues, internal investigators may lack the ability to remain impartial, in addition to the skills and training required to deal with intricate factual and legal issues.

Where the allegations are technical, complex, and would require a trained and experienced investigator to evaluate the evidence and reach a conclusion, employers would be well-advised to consider whether an investigation can be conducted internally, or if an external investigator is required. A flawed investigation can have expensive repercussions for the employer, as evident in the McGraw decision. A negligent investigation can expose employers to lawsuits and potentially be very costly for employers if it turns out that the investigation was not conducted fairly. The more serious the allegations, the more vigorously the courts and tribunals will scrutinize the investigation process.

This blog is provided as an information service and summary of workplace legal issues.

This information is not intended as legal advice.