Corporate Restructuring and Human Rights Liability
An employer is entitled to reorganize its business. Positions may be eliminated, reporting structures changed and employees reassigned as part of a legitimate corporate restructuring.
Human rights obligations, however, continue to apply throughout that process.
The fact that an employee’s position has legitimately disappeared does not necessarily end the analysis where the employer knows that the employee has a disability requiring accommodation.
This issue was considered directly in Sharma v. Best Buy Canada (No. 2), 2026 BCHRT 173. 1
The decision demonstrates that a restructuring may explain why an employee’s existing position has been eliminated. It does not necessarily justify ending the employment relationship without first considering whether the employee can reasonably be accommodated elsewhere in the reorganized workplace.
The Disability and Accommodation Request
Vikas Sharma had worked for Best Buy since 2018 and had been promoted twice. His most recent position was Assistant Store Leader – Mobile and Smart Living.
In early 2021, Sharma developed significant knee problems. Medical investigation identified a medial meniscus tear and gastrocnemius bursitis.
His medical restrictions required him to limit standing and walking and to perform sedentary work where possible.
Sharma advised Best Buy of his condition and sought accommodation. He also applied for other internal positions which he believed would be more compatible with his physical restrictions.
His accommodation request was medically supported on April 20, 2021.
Eight days later, his employment was terminated.
Best Buy advised him that his position had been eliminated as part of a corporate restructuring known internally as “re-banding”.
The Restructuring Was Legitimate
The Tribunal did not find that Best Buy had invented the restructuring as a means of terminating Sharma.
The restructuring was genuine.
This is an important aspect of the decision.
Human rights liability did not arise because Best Buy lacked a legitimate business reason to reorganize its operations.
The problem arose from the manner in which the restructuring was applied to an employee whose disability and need for accommodation were already known.
The elimination of Sharma’s existing job was therefore not the end of the inquiry.
The further question was whether Best Buy had met its obligation to accommodate him before deciding that his employment itself should end.
Disability Was a Factor in the Termination
The Tribunal found that Sharma had a physical disability protected by the British Columbia Human Rights Code.
The fact that he had continued working despite his physical limitations did not mean that he was not disabled. His condition materially interfered with his ability to perform the standing and walking requirements of his position.
The Tribunal also found that Sharma’s disability was a factor in his termination.
The timing was significant.
Best Buy knew of Sharma’s restrictions. His accommodation process was active. He had made clear his desire to remain employed and had been seeking alternative positions.
His employment was nevertheless terminated without meaningful consideration of whether reassignment, transfer, demotion or another position might accommodate his disability.
Human rights law does not require a protected characteristic to be the sole or predominant reason for adverse treatment.
It is sufficient that it was a factor in the decision.
The Duty to Consider Other Positions
This is the most significant aspect of Sharma.
Other employees affected by the restructuring had been transferred or reassigned.
A Team Lead position was available at Sharma’s store, but he was not considered for it.
Best Buy argued that it did not generally offer demotions as part of the restructuring.
The evidence, however, demonstrated that another employee had in fact accepted a demotion during the same process.
More importantly, Best Buy knew that Sharma wanted to continue working and that he was actively seeking employment within the organization which could accommodate his physical restrictions.
The Tribunal concluded that Best Buy knew or ought reasonably to have understood that Sharma might prefer a lower-level position, even at reduced compensation, to the termination of his employment.
The duty to accommodate did not require Best Buy to preserve a position which had legitimately been eliminated.
Nor does Sharma establish a general obligation to create an entirely new position for a disabled employee.
It did, however, require the employer to consider reasonable accommodation alternatives which existed within the reorganized business.
Depending upon the circumstances, these alternatives may include reassignment, transfer, modified duties or a lower-level position.
The Accommodation Process Cannot Simply Be Stopped
Best Buy’s difficulty was not simply the ultimate decision to terminate Sharma.
It was the failure to complete the accommodation inquiry before doing so.
The Tribunal stated that by terminating Sharma’s employment, Best Buy had foreclosed its investigation of reasonable and practical accommodation options.
There had been no sufficient assessment of what alternative positions or arrangements might be available once Sharma’s existing position disappeared.
There was also no financial or other evidence demonstrating that such alternatives would impose undue hardship.
This distinction is important.
An employer defending a discrimination claim cannot simply establish that the organizational decision which eliminated the employee’s former position was legitimate.
Where the employee has a disability requiring accommodation, the employer may also be required to demonstrate that reasonable alternatives within the reorganized workplace were considered and that further accommodation could not be provided without undue hardship.
Performance Concerns
Best Buy also relied upon concerns about Sharma’s performance.
The Tribunal was not persuaded by this evidence.
Sharma had a history of positive performance and had been promoted only months before the restructuring. He had also received recognition for his work during the COVID-19 pandemic.
Best Buy referred to an argument with another employee which it said affected its assessment of Sharma’s leadership.
There was, however, no contemporaneous documentation of the incident by way of a verbal or written warning.
The Tribunal treated this evidence with caution.
The point has significance beyond Sharma.
Where performance concerns form part of the explanation for selecting a disabled employee for termination during a restructuring, those concerns should be genuine, contemporaneously documented and applied consistently.
Performance concerns which emerge principally as a justification after termination may carry limited weight where the employee otherwise has a positive employment history.
Restructuring Does Not End the Duty to Accommodate
The central principle emerging from Sharma is straightforward.
A legitimate corporate restructuring does not extinguish an existing duty to accommodate.
An employer is entitled to decide that a particular position is no longer required.
That decision is analytically distinct from the decision that the employee who occupied that position can no longer remain employed.
Where the employee has a known disability requiring accommodation, the second decision requires consideration of the employer’s human rights obligations.
The proper inquiry may therefore include the following questions:
- Has the employee’s existing position genuinely been eliminated?
- Are there reasonable alternatives within the reorganized workplace which would accommodate the employee?
- Has the employee been meaningfully involved in that process?
- Are there vacant or available positions which should be considered?
- Would reassignment, transfer, modified duties or a lower-level position provide reasonable accommodation?
- Would the proposed accommodation impose undue hardship?
The elimination of a position does not itself answer these questions.
The Parallel With an Asset Sale
There is a close parallel between Sharma and employment decisions made during an asset sale.
The related issue is discussed in Asset Sales and Human Rights Liability.
In Sharma, the corporate event was an internal restructuring.
In an asset sale, the corporate event is the acquisition and transfer of a business.
In each situation, the underlying commercial transaction may be entirely legitimate.
That fact does not determine whether employment decisions made in implementing the transaction comply with human rights legislation.
The common feature is the selection process.
In Sharma, Best Buy was determining which employees would occupy positions in the reorganized business.
In an asset sale, the purchaser may be determining which employees of the vendor will be offered employment following the acquisition.
Human rights law applies to both processes.
A legitimate commercial event may explain why employment decisions must be made.
It does not determine whether those decisions are discriminatory.
The Important Difference From an Asset Sale
The distinction between the two situations is equally important.
Sharma involved an existing employer.
Best Buy already employed Sharma. It knew of his disability. The accommodation process had been triggered before the restructuring was completed.
The issue was therefore whether Best Buy had fulfilled its existing duty to accommodate Sharma to the point of undue hardship before terminating his employment.
An asset sale presents a different legal relationship.
The purchaser may never previously have employed the affected employee. It does not become liable merely because it purchases the assets of the existing employer.
Its potential liability arises from its own participation in a hiring or selection process which produces a discriminatory outcome.
The two situations therefore reach a similar human rights analysis by different routes.
In a restructuring, the existing employer must ensure that the reorganization does not cause it to disregard an existing accommodation obligation.
In an asset sale, the purchaser must ensure that its hiring and selection process does not discriminate on a prohibited ground.
The corporate mechanism differs.
The governing human rights principle does not.
The Selection Process
Both situations demonstrate that attention should be directed to the employment decisions made during the corporate transition.
The relevant questions include:
- Who was selected to continue in employment?
- Who was excluded?
- What criteria were used?
- Were employees with protected characteristics disadvantaged by those criteria?
- Were employees requiring accommodation meaningfully considered?
- Were reasonable alternatives investigated?
- Could accommodation have been provided without undue hardship?
The fact that an employer can establish a sound business justification for restructuring its organization does not answer these questions.
The restructuring may be legitimate while the selection process used to implement it is discriminatory.
The Remedy
The Tribunal concluded that, absent discrimination, Sharma would likely have continued working for Best Buy in a Team Lead position at a lower salary.
This finding is significant.
The remedy was not based upon the assumption that Sharma had a right to retain his former management position.
The likely non-discriminatory outcome was a demotion.
The Tribunal awarded Sharma $38,746.65 in lost wages and $1,589 in expenses.
It also awarded $20,000 as compensation for injury to dignity, feelings and self-respect, together with interest and compensation for the adverse tax consequences arising from the lump-sum wage award.
The remedy reinforces the central point in the decision.
The duty to accommodate did not necessarily require preservation of Sharma’s former job.
It required meaningful consideration of a reasonable means by which his employment could continue.
The Governing Principle
A corporate restructuring and a human rights analysis answer different questions.
The restructuring asks what positions the employer requires in the reorganized business.
Human rights law asks whether the decisions made in implementing that structure adversely affect an employee because of a protected characteristic and, where accommodation is required, whether the employer has accommodated to the point of undue hardship.
The first question cannot be used to avoid the second.
An employer therefore cannot end the analysis by stating that the position has been eliminated.
Where a disability requiring accommodation is engaged, the further question must be asked:
What reasonable employment alternatives remain within the reorganized workplace?
That is the essential lesson of Sharma.
Conclusion
An employer has the right to reorganize its business and eliminate positions for legitimate commercial reasons.
It does not have the right to suspend its human rights obligations while doing so.
Where a disabled employee’s position is eliminated, the employer must distinguish between the disappearance of the position and the termination of the employee.
The first may be entirely legitimate.
The second may still require an accommodation analysis.
Sharma demonstrates that reasonable alternatives within the reorganized workplace should be considered before the employer concludes that termination is inevitable. Reassignment, transfer, modified duties and even a lower-level position may require consideration, depending upon the circumstances.
The parallel with an asset sale is instructive.
Whether the corporate event is an internal restructuring or the acquisition of a business, human rights law continues to govern the employment decisions made in implementing the transition.
Corporate change may create the need to make employment decisions.
It does not provide a defence to discrimination.
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