Whistleblowers play a critical role in maintaining transparency and accountability in Canada’s financial markets. But what happens when an employee raises concerns about potential securities law violations—and then loses their job? A landmark Ontario decision has delivered a powerful message: retaliating against whistleblowers can come at a very high cost.
As an Ontario employment lawyer, I once represented an employee…
The case of McPherson v. Global Growth Assets Inc. marks the first civil court ruling in Canada to interpret the anti-reprisal provisions of Ontario’s Securities Act. The decision significantly strengthens whistleblower protections and offers important lessons for employees, employers, and legal professionals alike—including any Toronto employment lawyer, wrongful dismissal lawyer, or employment contract lawyer advising clients in regulated industries.
The Core Question: Can You Discipline a Securities Whistleblower?
In short: very carefully—or not at all.
The Ontario Superior Court made it clear that when an employee reports suspected securities law violations, employers must tread lightly. Even partially motivated retaliation can trigger severe legal consequences, including multi-million-dollar damages.
Case Overview: What Happened to Ian McPherson?
Ian McPherson was a senior executive working for Global Growth Assets Inc., a registered investment fund manager subject to oversight by the Ontario Securities Commission (OSC). During his employment, McPherson became concerned about possible violations of securities law involving the company’s former CEO.
Specifically, McPherson believed the former CEO was improperly influencing company operations through his daughter—despite being barred from doing so under a prior OSC order. Importantly, Global and its leadership already had a history of regulatory scrutiny.
McPherson raised his concerns internally, reporting them to the company’s independent directors on four separate occasions. According to the Court, those warnings were ignored. Soon after, McPherson was terminated without cause and without explanation.
Believing his dismissal was retaliation for whistleblowing, McPherson brought a civil claim under the Securities Act’s anti-reprisal provisions.
Understanding Whistleblower Protections Under Ontario Securities Law
Ontario’s Securities Act includes one of the strongest whistleblower protection regimes in Canada. It is designed to ensure employees can report suspected misconduct without fear of punishment.
Under section 121.5(1) of the Act:
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Employees may report concerns internally (“up the ladder”) or directly to regulators
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Employers may not terminate, demote, harass, or penalize an employee for whistleblowing
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Confidentiality clauses or contracts cannot be used to silence reports
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A whistleblower may pursue a civil lawsuit or binding arbitration
From an employment law perspective, this framework goes well beyond traditional wrongful dismissal principles. Any severance package lawyer in Toronto dealing with regulated employers must account for these statutory protections.
A Powerful Shift: The Employer Bears the Burden of Proof
One of the most important aspects of the McPherson decision is who must prove what.
Unlike some U.S. jurisdictions, the Ontario court ruled that:
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The employee does not need to prove retaliation
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The employer must prove that no reprisal occurred
In other words, if an employee engages in protected whistleblowing activity and then experiences a negative employment outcome, the employer must show that the two were not connected in any way.
For employers, this is a very high bar.
Key Legal Findings From the Court
The Court’s interpretation of section 121.5(1) dramatically expands whistleblower protections. Here are the most significant takeaways.
1. Partial Motivation Is Enough to Prove Retaliation
The Court ruled that an employer violates the Securities Act if any part of the decision to discipline or terminate an employee is motivated by whistleblowing—even if there were other legitimate reasons.
This means that even valid concerns about performance, restructuring, or management fit may not protect an employer if whistleblowing factored into the decision at all.
From the standpoint of a wrongful dismissal lawyer, this represents a major expansion of employee rights.
2. The Threshold for “Reasonable Belief” Is Very Low
An employee is protected if they have a belief that is:
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Subjective (they genuinely believed it), and
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Objectively reasonable based on information available at the time
The employee does not need to be correct.
This is crucial. Even if a whistleblower turns out to be mistaken, they may still be protected—as long as their concern was reasonable in context.
3. No Duty to Mitigate Damages
Unlike typical employment cases, whistleblowers under the Securities Act do not have a duty to mitigate their losses.
That means:
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Post-termination earnings are not deducted
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The employee does not need to seek comparable work to reduce damages
For employers, this dramatically increases financial exposure. For employees, it makes whistleblower claims uniquely powerful.
The Outcome: A Multi-Million Dollar Award
The Court had little difficulty concluding that McPherson’s termination was an unlawful reprisal.
It found that:
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McPherson reasonably believed securities laws were being breached
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His reporting was the predominant reason for his dismissal
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Global failed to prove that retaliation played no role
As a result, the Court awarded McPherson twice his lost remuneration, as permitted under the Act.
Total damages awarded:
$5,379,808.22, plus interest
Notably, McPherson was not required to offset this amount by income earned elsewhere.
This ruling would catch the attention of any Toronto employment lawyer advising employers in regulated industries.
What This Case Means for Employers
The McPherson decision sends a clear warning: whistleblower retaliation—direct or indirect—can lead to devastating consequences.
Key employer lessons include:
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Document performance concerns before any whistleblowing occurs
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Ensure discipline decisions are fully independent of protected activity
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Avoid rushed terminations following internal reports
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Maintain a clear, consistent paper trail
The Court placed significant weight on the lack of contemporaneous documentation supporting Global’s stated reasons for termination.
Can an Employer Ever Discipline a Whistleblower?
Yes—but with extreme caution.
The Court acknowledged that whistleblower protection is not absolute immunity. Employers may still discipline or terminate employees for legitimate reasons, provided those reasons are entirely unrelated to the protected disclosure.
However, once whistleblowing enters the picture, the employer must be able to prove—clearly and convincingly—that it played no role whatsoever.
Strategic Implications for Employment Law in Toronto
This case has broad implications for employment law in Ontario, particularly for:
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Financial institutions
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Investment managers
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Public companies
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Compliance-heavy industries
Any employment contract lawyer drafting termination clauses or confidentiality provisions must ensure they do not conflict with securities law protections. Similarly, severance package lawyers in Toronto must assess whether whistleblower issues elevate exposure far beyond common law notice.
Final Thoughts: A New Era for Whistleblower Protection
McPherson v. Global Growth Assets Inc. reshapes the legal landscape for whistleblower retaliation in Canada. It confirms that securities law protections are robust, employee-friendly, and backed by serious financial consequences.
For employees, the case reinforces the right to speak up without fear.
For employers, it highlights the importance of compliance, documentation, and restraint.
For legal professionals, it underscores the need for specialized advice from an experienced Toronto employment lawyerwhen whistleblowing issues arise.
In today’s regulatory environment, retaliation is no longer just a risk—it’s a liability that can cost millions.
Call Toronto Employment Lawyer Now
It is important for an employee (or an employee) to obtain a legal consultation before taking any action that could affect their situation at workplace. Sezar has experience advocating for both employers and employees, which allows him to anticipate the other side’s arguments and develop an effective strategy, including termination of employment.
If you are looking for a wrongful dismissal lawyer in Toronto, call us today at 647-822-5492 for a case evaluation with an experienced employment lawyer.
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