Executive Summary: Key Legal and Evidentiary Issues

• An employee was dismissed for cause after failing to isolate upon learning his roommate tested positive for Covid-19, continuing to work for 3.75 hours in breach of the employer's workplace safety policy.

• Credibility of the appellant's late-raised claim that a supervisor directed him to remain at work was rejected by the Reconsideration Panel, given prior inconsistent statements throughout the investigation.

• The "new evidence" that a supervisor allegedly directed the appellant to continue working did not meet the admissibility threshold under the Davies criteria, as it could have been discovered and presented through due diligence.

• Patent unreasonableness was confirmed as the appropriate standard of review for the Tribunal's exercise of discretion, pursuant to s. 58(2)(a) of the Administrative Tribunals Act.

• Entitlement to compensation for length of service under s. 63(3)(c) of the Employment Standards Act was denied because the employer met its onus to prove just cause for dismissal.

• The Court of Appeal performed a de novo review and found no basis to disturb the chambers judge's conclusion that the Reconsideration Decision was not patently unreasonable.

The facts of the case

Ken Kua Yung Chao was employed for more than six years as a packer with Hallmark Poultry Processors Ltd. in British Columbia. During the Covid-19 pandemic, the poultry processing industry had faced several shutdowns due to Covid-19 during the first year of the pandemic, prompting Hallmark to institute a workplace Covid-19 safety policy (the "Policy"). That Policy required that "employees were not to enter the building if they had been in contact with anyone who was symptomatic [of Covid-19] or living in the same household with a symptomatic individual." Mr. Chao was aware of this Policy.

The incident leading to dismissal

On September 28, 2021, while at work during his morning coffee break, Mr. Chao learned that his roommate — who also worked for Hallmark — had tested positive for Covid-19. Rather than isolating immediately as required by the Policy, Mr. Chao continued working for 3.75 hours after learning of her Covid-19 positive test. On October 4, 2021, when Mr. Chao returned to the workplace with a negative Covid-19 test result, Hallmark dismissed him for failing to comply with the Policy. Mr. Chao's explanation during the investigation was that he returned to work because he felt fine, was showing no symptoms, and that when tested, he was negative for the Covid-19 virus.

The employment standards complaint and initial determination

On October 5, 2021, Mr. Chao filed an employment standards complaint with the Director of Employment Standards under s. 74 of the Employment Standards Act, alleging that Hallmark had contravened the ESA by failing, on his dismissal, to pay him compensation for his six years of service. Between April 5, 2021 and January 23, 2023, a delegate of the Director (the "Investigator") investigated Mr. Chao's complaint. The Investigator reviewed materials submitted by both parties, interviewed the parties and others, and subsequently prepared a report summarizing these materials and communications (the "Investigation Report"). Both parties were provided an opportunity to respond to the Investigation Report and did so. On April 6, 2023, another delegate of the Director of Employment Standards issued a determination concluding that Mr. Chao's claim for compensation should be dismissed because Hallmark met its onus to prove that it had just cause to dismiss him. The delegate found that Mr. Chao breached his duty to Hallmark and committed serious misconduct, and that Hallmark did not owe him compensation for length of service. In reaching the determination, the delegate considered the context in which the dismissal occurred including the state of the pandemic and the outbreaks that had occurred in the poultry processing industry.

The appeal and reconsideration proceedings

On May 2, 2023, Mr. Chao appealed the Determination to the Employment Standards Tribunal under s. 112(1) of the ESA, alleging that there had been a failure to observe the principles of natural justice. On August 23, 2023, the Tribunal's Appeal Panel dismissed Mr. Chao's appeal and confirmed the Determination. The Appeal Panel found Mr. Chao's submissions did not raise any issues of procedural fairness and also found no error in the finding of just cause, concluding that there was no reasonable prospect that his appeal would succeed under s. 114(1)(f) of the ESA. On September 4, 2023, Mr. Chao applied to the Tribunal for reconsideration of the Appeal Decision under s. 116 of the ESA, raising for the first time a new argument: that it was not his decision to keep working, but that his supervisor had told him to return to work. The Reconsideration Panel applied the two-stage test from Re Milan Holdings, B.C. EST #D313/98, and concluded that Mr. Chao's application did not pass the first stage. The Panel found that this claim constituted "new evidence" that failed to meet the admissibility criteria set out in Davies et al., BC EST #D171/03, as it could have been provided, explored and obtained through due diligence before the Determination was issued. Moreover, the Panel found Mr. Chao's assertion not credible, noting that throughout the entire investigation and appeal process, he had consistently stated that he returned to work because he felt fine and was not symptomatic — never mentioning any supervisor direction. The record revealed that in his original complaint, Mr. Chao stated he was fired "I am guessing because of covid, I get tested negative but they told me that I am no longer working here, they still fire me," and in separate January 3, 4 and 5, 2023 emails to the investigating officer, he maintained that since he never tested positive, he posed no threat to his fellow workers. His only explanation for this omission to the Reconsideration Panel was that he "just forgot."

The judicial review and standard of review

On November 20, 2023, Mr. Chao filed a petition for judicial review with the British Columbia Supreme Court, arguing that the Reconsideration Decision was patently unreasonable because the Reconsideration Panel had not accepted his evidence that his supervisor directed him to go back to work. On August 8, 2025, the chambers judge dismissed Mr. Chao's petition for judicial review. The chambers judge noted that a tribunal's acceptance or rejection of a piece of evidence does not make its decision patently unreasonable, and that Mr. Chao had made a prior inconsistent statement and there was "ample evidence" on which the Reconsideration Panel could decide that his submission regarding his supervisor's direction was not credible. The applicable standard of review was patent unreasonableness, as a result of the combined effect of ss. 110 and 103 of the ESA and s. 58 of the Administrative Tribunals Act. Under this highly deferential standard, a decision is not patently unreasonable unless it is "clearly irrational" or "evidently not in accordance with reason" or "so flawed that no amount of curial deference can justify letting it stand."

The ruling and outcome

On appeal to the British Columbia Court of Appeal, heard on March 6, 2026, the Court dismissed Mr. Chao's appeal. The Court, comprising Justice Butler, Justice Horsman, and Justice MacNaughton, was satisfied that the chambers judge had identified the appropriate standard of review, patent unreasonableness, and applied it correctly to the Reconsideration Decision. The Court noted that Mr. Chao did not point to any specific errors in the Reconsideration Decision but instead attempted to reargue issues he had already unsuccessfully raised before the Reconsideration Panel and on judicial review. The Reconsideration Decision involved an exercise of discretion by the Reconsideration Panel, based on its assessment of the evidence, and the exercise of discretion was not patently unreasonable having regard to the factors in s. 58(3) of the ATA. Hallmark Poultry Processors Ltd. was the successful party and was entitled to its costs. The Tribunal did not seek its costs. No specific monetary amount for costs was determined in the decision.