Everyone is familiar, at least on a general level, with the requirements of human rights legislation. I cannot refuse to rent out an apartment or hire a person just because he or she is of a certain race or has a specific religious belief, etc. But in each of these instances, it is always a “direct” form of discrimination. However, many small business owners are not aware that they could be found liable for “indirect” discrimination. Or, even if they are not found liable, they run the risk that they could face litigation in such cases.
For example, suppose Manufacturer A wants to deal with Distributor B. However, Distributor B knows that Manufacturer A gets parts from Supplier C. If Distributor B refuses to deal with Manufacturer A, or makes it a condition that it will only do the deal if Manufacturer A dumps Supplier C as a supplier, then this could be a “discriminatory business practice” which is prohibited in Ontario by the not-too-surprisingly named Discriminatory Business Practices Act.
The key issue is whether the reason for the refusal to deal or the condition is because of an “attribute” of, in this example, Supplier C. An “attribute” is defined in the legislation quite broadly as: “the race, creed, colour, nationality, ancestry, place of origin, sex or geographical location of the person, and includes the race, creed, colour, nationality, ancestry, place of origin, sex or geographical location of a person connected with the person or nationals of a country with the government of which the person conducts, has conducted or may conduct business.”
Now, in a general sense, this legislation is similar to the restrictions under the human rights legislation. But, bear in mind that under that legislation the only way you can obtain relief is to make a complaint to the Human Rights Commission. While there are plans to amend the legislation to permit a complainant the right to sue the wrongdoer directly, these amendments are still pending. But in the case of discriminatory business practices, the legislation has permitted lawsuits for many years now. There is still the possibility of making a complaint to a government official who can start an investigation, but the complainant can also sue in the courts. In addition, either the government or the complainant can bring an application to the courts for an injunction to stop the discriminatory practice.
It is basic human nature for religious or national groups to have a preference for dealing with others in their same group. So, to take my ancestry as an example, if I have a choice of buying supplies from a company run by a Maltese person or from a German person, my natural tendency is to go with the Maltese person’s company. In this instance, there is nothing intended against the German person. But, the fact that I have not chosen the German person, simply because he has a certain attribute (ie. he is not Maltese), this will be sufficient to potentially expose me to claims under this legislation. And, again, this would apply if I said to the Maltese person that I will only deal with that person if the others that he/she deal with are also Maltese.
This legislation has, somewhat surprisingly, received little attention over the years as the focus has been, rather, upon the human rights legislation. But it is something that can prove very helpful to small business if they should find themselves on the receiving end of a discriminatory practice. In addition, it is something they should be careful about.