Canadian Whistleblowers: Landmark Ontario Ruling
Does it really pay to be a whistleblower in Canada? The question plagues those who spot actual or potential regulatory wrongdoing, unsure how to act.
A recent decision from the Ontario Superior Court of Justice provides encouragement to whistleblowers, all based on what is now a more clear view of the anti-reprisal provisions of the Ontario Securities Act. In McPherson v. Global Growth Assets Inc., 2025 ONSC 5226, the Court delivered what many consider to be the first comprehensive statement on the anti-reprisal provisions in Ontario’s securities legislation. The case arose in the employment context, and was decided by an influential court situated in Canada’s largest business city.
Ian McPherson had been the CEO of the defendant Global Growth Assets, and he initiated litigation which included allegations of statutory reprisal pursuant to the Ontario Securities Act. The Court found against the defendant employer, holding that they unlawfully terminated McPherson in reprisal for his raising and intending to raise concerns about corporate securities law non-compliance.
The decision adopts a so-called “motivating factor” standard for causation, confirms that employers have a reverse onus in reprisal cases, and awarded significant statutory remedies in favour of McPherson. In particular, the Court awarded two times the remuneration which the executive would have earned from the date of the reprisal to judgment, without mitigation. In other words, damages otherwise payable on account of the loss of employment were subject to a “2X” multiplier based on the conduct of the defendant employer / securities laws registrant. In McPherson’s case, the result was an award in excess of $5 million.
McPherson had been hired by Global following Ontario Securities Commission scrutiny about the company and its operations. One specific reason why McPherson was purportedly hired was to lead remediation and restore regulatory compliance. After the Board attempted, without consulting McPherson, to have a colleague no longer report to him, McPherson raised concerns about potential securities law violations. Rather than address those potential issues, the Board proceeded to terminate McPherson without cause.
Takeaways for Employers
The Court’s analysis may well breathe fresh life into the whistleblower provisions in place under Ontario securities laws. As an initial matter, the decision confirms that the Boards of Directors of securities law registrants must not impede compliance programs. Employers will, going forward, need to treat internal reporting or discussions about securities law violations as activity which protects or insulates executives, at least to a degree. Indeed, the decision essentially confirms that a whistleblower is engaging in a form of protected activity. The result is that any adverse actions taken against a complainant will be subject to a reverse onus, with the employer having the obligation to prove that compliance concerns played absolutely no role in any termination decision. The potential consequences for a breach of these rules can be severe – the double-remuneration remedy is set out applicable legislation. When taken together, this ruling reinforces the importance of having a robust compliance program.