Allstate whistleblower facing $700K lawsuit says insurance giant trying to silence her

A former Allstate Insurance Canada employee who spoke out against an alleged discriminatory policy is facing a lawsuit seeking more than $700,000 in damages.

Her lawyer says the legal battle, which will head to a Toronto court on Thursday, could set a dangerous precedent and discourage private sector employees from speaking out against their employers.

If the lawsuit succeeds, “people are going to be less willing to go out and comment to the media about concerns and potential inappropriate activity,” said Andrew Monkhouse, who is representing Mehda Joshi.

“There’s a public interest in having ex-employees be able to talk about what happened at their past work.”

Joshi claims she was fired by Allstate last year after confronting her managers over a plan to stop selling insurance to drivers who live in Brampton, which has some of the highest premiums in Ontario.

Joshi argued that the plan was a thinly veiled attempt to deny auto insurance to the city’s large visible-minority population.

“It’s just wrong. There is no other word for it,” she told CBC Toronto in late 2018.

Joshi filed a wrongful dismissal suit against Allstate after losing her job and spoke to the CBC about the ordeal.

The US-based insurance giant has since filed a counterclaim alleging that Joshi caused “damages to Allstate’s reputation and goodwill.”

Joshi and her lawyer are seeking to have the counterclaim dismissed, and to proceed with their original wrongful dismissal lawsuit, which is seeking some $600,000 in damages.

“We do hope that if we’re successful, it will give a clear message to all employees that if they have concerns of impropriety at their workplace, that they’re able to voice those concerns,” Monkhouse said.

Joshi declined to comment directly to CBC Toronto, while Allstate did not respond to multiple interview requests.

Joshi’s lawyer Andrew Monkhouse said private sector workers may be discouraged from speaking out if the court rules in Allstate’s favour. (Michael Cole/CBC)

Allstate trying to silence critics, submission claims

Joshi argues that Allstate’s counterclaim is an attempt to silence her and to discourage whistleblowing around the issue of discrimination.

In her latest court submission, Joshi said the company has tried to cause a “chilling effect” that would stop her from speaking to the media.

“It is very stressful to have your past employer sue you for so much money for speaking out about concerns you have regarding their practices,” Joshi writes in the submission.

The submission also claims the company has used similar practices of “strategic litigation” to silence other critics, though it does not provide specific examples.

Fewer protections for private sector workers

According to an employment law expert, Joshi’s claim against Allstate will be weaker than typical whistleblowing cases, which usually happen within the public sector.

That’s because private sector employees do not have the same protections as public servants, who are legally protected when speaking out about a wider range of misconduct at their places of work.

“In the private sector there aren’t those protections,” said Joseph Cohen-Lyons, a Toronto-based employment lawyer.

“An employee is only protected if they’re whistleblowing about a criminal action.”

Cohen-Lyons said disgruntled private sector workers rarely approach him seeking help, in part because those workers may be fearful of losing their jobs due to a lack of whistleblower protections.