December 17, 2013

SCC Confirms International Organizations’ Immunity to Wrongful Dismissal Actions

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In its decision in Amaratunga v Northwest Atlantic Fisheries Organization (“NAFO”), 2013 SCC 66, released on November 29th, 2013, the Supreme Court of Canada (“SCC”) confirmed that international organizations operating in Canada may enjoy immunity from certain Canadian laws, including wrongful dismissal actions by senior employees. NAFO is an international organization with its headquarters located in Dartmouth, Nova Scotia. NAFO’s objective is to contribute through consultation and cooperation to the optimum utilization, rational management and conservation of the fishery resources of the NAFO Convention Area.

Amaratunga was a senior employee with NAFO for 18 years before being terminated from his employment. When Amaratunga launched a wrongful dismissal action, NAFO claimed immunity under an agreement previously reached with Canada. The Northwest Atlantic Fisheries Organization Privileges and Immunities Order (“Immunity Order”) granted NAFO immunity from Canadian law “to such extent as may be required for the performance of its functions.” The interpretation of this language was instrumental in the SCC’s analysis.

The SCC noted that the immunities granted were essential to the efficient and independent functioning of international organizations. The SCC also emphasized the importance of making Canada an attractive location for these types of international organizations.

Upon broadly interpreting the language in the Immunity Order, the SCC determined Amaratunga’s wrongful dismissal action fell within the ambit of the language of the Immunity Order. As such, NAFO was granted immunity from the wrongful dismissal action, as the Canadian common law relating to reasonable notice of termination was found to have interfered with NAFO’s “performance of its functions.”

In his lawsuit, Amaratunga also made a claim for loss of the separation indemnity he was entitled to under the terms of his employment contract. The separation indemnity was a contractual payment obligation set out in NAFO’s Staff Rules. The Staff Rules provided that the indemnity was to be paid to any departing employee, regardless of the reason for the termination of their employment. On this point, the SCC determined that NAFO did not require immunity as the separation indemnity was did not interfere with the performance of NAFO’s functions.

The SCC addressed the inequity whereby Amaratunga has no forum in which to air his grievances and seek a remedy, however, went on to say: “it is the nature of an immunity to shield certain matters from the jurisdiction of the host state.”

Limits of the Decision

International organizations may enjoy immunity from Canadian laws where there is a binding agreement between the international organization and the government of Canada which specifically grants such immunity. However, immunity from wrongful dismissal actions may not apply to all employees. The SCC appears to have limited the immunity enjoyed by NAFO to wrongful dismissal claims from senior employees. An international organization might not enjoy the same immunity in relation to lower level employees. This is evidenced by the SCC’s statements in the decision:

To allow employment-related claims of senior officials to proceed in Canadian courts would constitute undue interference with NAFO’s autonomy in performing its functions and would amount to submitting its managerial operations to the oversight of its host state’s institutions. [Emphasis added]

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