On October 6, 2016, the British Columbia Supreme Court ruled that a lawsuit by Eritrean miners, who allege they were forced to work in a mine owned by Nevsun Resources Ltd, a Canadian mining company, can proceed to trial. Vancouver-based Nevsun had argued that the case should be dismissed and that any suit should be properly heard in Eritrea. Justice Abrioux disagreed, stating that “there is sufficient cogent evidence from which I can conclude that there is a real risk that the plaintiffs could not be provided with justice in Eritrea,” thereby paving the way for an unprecedented trial in a Canadian court. Justice Abrioux stated that “claims of crimes against humanity, slavery, forced labour and torture can go forward against Nevsun.” This case represents the first time that foreign claimants have been able to proceed to trial in a lawsuit in Canada against a Canadian company for alleged violations of customary international law for human rights abuses in overseas operations.

In affidavits filed with the court, six men, who have since left Eritrea, allege they were forced to work at the Bisha mine from 2008 to 2012, during which time they endured harsh and unsafe conditions including hunger, illness and physical punishment, all under the control of military commanders. They allege that they were conscripts in the country’s compulsory military service and forced to work at the Bisha mine owned by Nevsun.

As we wrote in our blog post last year, Canadian courts are revealing a new willingness to expand their jurisdictional reach in light of commercial realities flowing from globalization and in response to perceptions of corporate impunity. They have demonstrated that they are not adverse to finding that Canadian companies owe a duty of care to the foreign workers who produce their products. This emerging trend in Canada is taking place against the backdrop of hardening and expanding international business and human rights standards and norms. As large civil claims for alleged overseas human rights violations find receptive courts in Canada, it is critical for Canadian multinational employers to take stock and commit to action. A failure to understand and act upon the emerging risks can have a significant negative impact on profitability and undermine a company’s social license to operate.

While there is no “one size fits all” solution, demonstrating respect for human rights, knowing the direct and indirect impacts of business activities and supply chains, and establishing effective due diligence processes are increasingly essential for large and small businesses alike. The necessary first step is a legal risk analysis of current activities and operations, followed by the implementation of human rights policies and supplier codes of conduct, and swift action to investigate and remedy problem areas. By undertaking these preventative measures, multinationals will minimize their financial, brand, and legal risk.