In Cunningham v 2001426 Alberta Ltd. o/a Ultimate Tradesmen Edmonton, 2026 AHRC 43 (“Cunningham”) the Human Rights Tribunal of Alberta rejected an employer’s application to dismiss a compliant on the basis that the employee refused a fair and reasonable settlement offer.
In order for the Tribunal to dismiss a compliant on the basis that an employee has rejected settlement offer, the employer must clearly demonstrate that the proposed settlement was fair and reasonable.
In Cunningham, the Employer failed to satisfy the Tribunal that the settlement offer was fair and reasonable, in the context of the specific complaint, and the matter was directed to a hearing.
Facts
The relevant facts as summarized by the Tribunal:
- The employee (the “Employee”) filed a compliant, pursuant to section 7 of the Alberta Human Rights Act (the “Complaint”) citing that she had experienced discriminatory conduct as well as workplace harassment.
- The Complaint contained serious allegations including being denied decent work, assigned to unsuitable or unsafe work, and given less favourable opportunities than her colleagues, on the basis of colour, gender, race, and religious beliefs.
- The Director referred the complaint to the Chief of the Commission and Tribunals under section 21(1)(c) of the Alberta Human Rights Act specifically noting limitations in the Employee’s particulars as well as issues requiring adjudication.
- The Employer provided a settlement offer providing:
- A payment of $5,000, as general damages.
- Requiring certain employees to complete the Commission’s online workshop titled Human Rights in the Workplace.
- Specific conditions for acceptance, including terms addressing: no admission of liability, non-disclosure, and non-disparagement.
- In exchange for the settlement, the Employee would withdraw the Complaint and execute a release in favour of the Employer.
- The Employee rejected the offer.
- The Employer then applied to the Director to dismiss the Complaint on the basis that the offer was fair and reasonable.
- The Director provided the Tribunal with the governing framework from Okeke v. Calgary Police Force Service (Okeke) 2025 AHRC 115 to assess considerations relevant for determining if the offer was fair and reasonable.
Analysis / Conclusion
Adopting the analysis of Okeke, the Tribunal reiterated that where a complainant has refused a fair and reasonable settlement offer, the complaint may be dismissed. Section 21(1)(c) of the Act provides for matters to be referred “for resolution”, empowering the Tribunal to “deal with a complaint”, by taking “…any action it considers appropriate in respect of a complaint…” without restriction.
The approach for evaluating a settlement offer as fair and reasonable is found in Okeke and Lambert v Canadian Natural Resources Limited, 2024 AHRC 105. These cases inform how the Tribunal should review the record and the particulars of the allegations. This assessment is not intended to be an exhaustive evaluation of the probability of success for the complaint, but rather a contextual exercise in assessing what may be fair and reasonable in the face of an untested case. The Tribunal is expected to conduct a limited review of the merits of the complaint only to the extent required to give the Tribunal an understanding of if context of the allegations.
Articulated differently, the Tribunal is guided to determine if an offer is fair and reasonable considering the allegations and the respective risks to the parties.
The Tribunal found that the allegations by the Employee, if proven, could attract general damages materially higher than the $5,000 provided for in the settlement offer, and the other remedies offered were more in the public interest than that of the Employee. The Tribunal cited some cases where fair and reasonable settlement offers were sufficiently demonstrated, but determined that in this case the offer was not clearly demonstrated to be fair and reasonable.
The Tribunal rejected the application to dismiss the Compliant and ordered that the Complaint would proceed to a hearing.
My Take
The Tribunal maintains a broad and purposeful approach to interpreting the Act, particularly resolving matters placed before it and its processes.
In order to demonstrate that a settlement is fair and reasonable, the entire context of the complaint must be examined. An understanding of the relative risks of each party, the potential outcomes (including balancing litigation risk against the damages that could be awarded).
Further, in cases where a settlement offer includes a combination of compensation for the complainant and corrective actions, the entirety of the settlement must be demonstrably fair and reasonable. Therefore, both public interests and the direct impact of the discrimination upon the complainant must be weighed and balanced. A settlement offer that does not address the entirety of the complaint in a fair and reasonable manner is not likely to be found as sufficient.
After reading this decision, I think more caselaw on what constitutes a reasonable human rights settlement offer is required. This case provides some general comments about what might be fair, but it will still be very difficult to evaluate whether any specific offer would be considered fair and reasonable.
