Whistleblower Facing $700,000 Lawsuit from Allstate Insurance Canada

A whistleblower who sued Allstate Insurance Canada for wrongful dismissal and discrimination against consumers is now facing a $700,000 lawsuit from the company.

Medha Joshi, former manager, is on the receiving end of the countersuit, which experts say may set a dangerous precedent if the insurance company wins. A win for Allstate might discourage private-sector employees from speaking out against their employers.

Joshi claimed in her lawsuit that she was dismissed after confronting her managers about an unwritten directive to stop offering car insurance in Brampton. Brampton has some of the highest auto insurance rates in Ontario. The former employee claimed that the move was part of an attempt to deny insurance to the city’s visible-minority population.

Insurance companies that operate in Ontario must follow “the all-comers rule.” According to a mississauga employment lawyer , the rule states that if applicants meet the provider’s criteria and are approved by FSCO, they cannot be denied insurance, regardless of their location or ethnic background.

According to Joshi, her managers made sure not to put any of the new policy’s details in writing. When she pushed for clarification on how to communicate the policy to staff, she became more isolated by those above her in the company.

Joshi said she was no longer able to get meetings or have weekly discussions with her manager. She was fired at what was supposed to be a routine meeting. Joshi said she never received any prior warnings and was given no possible recourse after her termination.

Allstate said in a statement filed in court that Joshi had participated in an underhanded effort to have an employee transferred to another location. Joshi has denied the allegation.

Her lawsuit, which seeks $600,000 in damages, may pave the way for Brampton drivers to launch their own complaints and lawsuits against the insurance company.

According to mississauga employment lawyers, Joshi’s claim will be weaker than the usual whistleblowing cases, which typically happen within the public sector.

Private sector employees are not awarded the same whistleblower protections that public sector employees are given. Typically, employees in the private sector are only protected if they are speaking out against a criminal action.

Still, Joshi argues that Allstate’s countersuit is merely an attempt to silence her and prevent her from talking to the media about the issue of discrimination.

The submission also alleges that Allstate has engaged in similar practices of “strategic litigation” to silence critics, but no specific examples have been provided.

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Melissa Thompson writes about a wide range of topics, revealing interesting things we didn’t know before. She is a freelance USA Today producer, and a Technorati contributor.