Three days before Christmas, a Board of Inquiry appointed under the Ontario Human Rights Code released a decision that had been pending for almost two years. In Kearney v. Bramalea Ltd., the board held that three landlords had discriminated against prospective tenants on the basis of sex, age, citizenship and several other grounds. Their crime? They had refused to rent apartments to applicants whose rental payments would exceed specified percentages of their monthly income (25%, 30% or 36%, depending on the landlord).
This outcome was not unexpected. In fact, while the board procrastinated, the Ontario government took steps to override its anticipated ruling, amending the Human Rights Code in 1997 to allow the government to allow landlords certain forms of income screening.
Yet the case nevertheless has consequences. It will be cited as a precedent in subsequent attempts to push the envelope of human rights law even further into absurdity. Its rationale will be applied not only to landlords, but also to banks, finance companies and potentially to every business serving consumers.
The board's finding of discrimination may seem far-fetched to the average person. After all, a rent-to-income ratio sounds like a pretty objective test. It can be either passed or failed by individuals of both sexes, all races, any age or any nationality. But in the brave new world of what passes for human rights law these days, objectivity doesn't matter.
Instead, Ontario's Human Rights Code has adopted the notion of "systemic" or "adverse impact" discrimination. If it can be shown that the landlord's rule — despite its surface neutrality – affects one group of people more than another, it's considered discriminatory. For example: People under 25 generally have lower incomes than people aged 45. Obviously, a younger person is likelier to fail the landlord's screening test. The board says the test discriminates on the basis of age.
With this reasoning, can a landlord do any screening that escapes the taint of discrimination? What about demanding a credit rating or employment history? Oh, no — this too would discriminate against young people, refugees or welfare recipients who had never established such credentials.
This very argument was made before the board by lawyer Elizabeth Symes, who wanted virtually all forms of income screening declared illegal. The board declined, saying that alternative screening methods were "beyond the scope of the complaints before us," but it hinted repeatedly that landlords would not fare well should some would-be tenant ever complain of such practices.
Given that kind of encouragement, it's not hard to imagine where this systemic discrimination "reasoning" might lead among those hostile to the institution of the marketplace. Charging a deposit for first and last months' rent would obviously discriminate against those who can't afford the deposit. Even fixing the rent at a specific price — say, $700 per month — discriminates against those who can't afford it. And among those who can't afford it, we are likely to find a higher than average representation of young people, refugees, welfare recipients and possibly several other categories of protected minority groups.
Taken to its logical conclusion, a landlord could avoid discriminating against people in these protected categories onlyF by giving away free apartments, no questions asked and no strings attached, to anyone who wanted one.
Similarly, a supermarket could be considered guilty of age discrimination by setting the price of filet mignon at double the price of ground beef. This dastardly deed virtually guarantees that a higher percentage of 45-year-olds will dine on steak while the under-25 crowd chokes down hamburger.
Human rights zealots will undoubtedly protest that they would never go this far. The law permits businesses to engage in practices that would constitute systemic discrimination if those practices are "reasonable and bona fide in the circumstances." But there's another catch -- the Code permits a finding of reasonableness and good faith only if it's impossible to accommodate the demands of the person discriminated against without "undue hardship."
How does this work in practice? In a 1995 case, the board held that it was not undue hardship to force a chiropractor to spend $20,000 renovating his office building to accommodate one prospective wheelchair-bound patient who had sought treatment seven years earlier. The board rejected the chiropractor's much less expensive solution of making house calls.
This law ultimately grants the Human Rights Commission extensive control over every consumer transaction and employment contract in the province. No longer can business enterprises determine their own credit-granting criteria or even their own capital expenditures. Only the Commission's limited budget prevents it from assuming its role of economic dictator. In the federal arena, the head human rights commissioner has been campaigning to forbid poverty as an explicit ground of discrimination. What other purpose could this serve except to facilitate an attack on businesses' right to set their own prices?
Every country that has ever engaged in command-and-control economy has ended up an economic basket case. Canada's respect for the traditional human rights of private property and freedom of contract gave us our economic prosperity. The newly minted privilege to be free from "systemic discrimination" overrides the system of free markets and free minds that make prosperity possible. We don't need another experiment to demonstrate that allowing a government agency to usurp businesses' decision-making process is a recipe for economic disaster.
Instead of trying to undo the damage caused by the Human Rights Code on a case-by-case basis, or keeping it in check by a tight grip on the Commission's purse-strings, the Ontario government should simply repeal this dangerous law before it fully unleashes its destructive power on us.
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