Canada: Fine Against Metron Construction Nearly Quadrupled By Ontario Court Of Appeal

As previously discussed here, in 2009 a scaffolding accident resulted in four workers falling fourteen stories to their deaths.  The incident resulted in a criminal conviction and a $200,000 fine against the employer, Metron Construction.  The sentence was appealed by the Crown, and in a recent unanimous decision, the Ontario Court of Appeal increased the fine against Metron nearly fourfold, sending a clear message to employers regarding the importance of workplace safety.

On December 24, 2009, five workers and a site supervisor employed by Metron boarded a swing stage that later collapsed as it descended from the exterior of a high-rise construction site. Five of the six workers had not been properly harnessed or attached to safety lines, nor had they been properly trained in the use of fall protection. The swing stage itself was not in proper condition and had been loaded in excess of its maximum weight capacity. It was also later revealed that three of the workers, including the supervisor, had levels of marijuana in their systems consistent with recent ingestion.

At trial, Metron's president entered a guilty plea to four counts under the Occupational Health and Safety Act, each stemming from a failure to take reasonable care to ensure the health and safety of Metron's workers. He was sentenced to pay a fine of $22,500 per count, for a total of $90,000, plus a statutorily-required victim fine surcharge of 25%. Metron pleaded guilty to one count of criminal negligence causing death under the Criminal Code and was sentenced to a fine of $200,000 plus a 15% victim surcharge, the rationale being that as the fine was three times the net earnings of the business in its last profitable year, it should send a "clear message" of the importance of workplace safety to all businesses.

The Court of Appeal disagreed, holding that the sentence was "demonstrably unfit", and increased the fine to $750,000.  In reaching its decision, the Court of Appeal took issue with the sentencing judge's reliance on the OHSA in crafting its sentence.  The Court found that the sentencing regime under the OHSA failed to reflect the higher level of moral blameworthiness inherent in criminal offences and the particular gravity of criminal negligence causing death.

Further, the Court determined that the sentencing judge had failed to properly consider the principle of proportionality found in the Criminal Code, which calls for a sentence that is proportionate to the gravity of the offence and the degree of responsibility of the offender.  It also held that Metron should not be able to distance itself from culpability due to a guilty individual's lower rank on the corporate ladder or diminished level of management responsibility (referring here to the actions of the site supervisor).

Importantly, the Court also determined that the sentencing judge had placed undue weight on Metron's ability to pay. While the impact of a fine on a company's economic viability may be considered if it is a significant employer and would put the continued employment of its employees at risk, putting a corporation out of business may well be an "acceptable consequence" if it marks the gravity of an offence and sends an unequivocal message.  Noting that the $200,000 fine was at the lower end of the OHSA range for fatality cases, and that it failed to reflect the moral blameworthiness and gravity of the offence of criminal negligence causing death, as well as the principle of proportionality, the Court unanimously decided to increase the fine.

Our View

Appellate courts accord deference to the discretion of sentencing judges, given that they do not enjoy the full benefit of oral and written submissions from the Crown and the accused.  Absent a lower court's error in principle, failure to consider a relevant factor, or an overemphasis of appropriate factors, the Court of Appeal will interfere only if the sentence is demonstrably unfit.  In this case, the Court of Appeal held that the initial $200,000 fine was demonstrably unfit.

While ability to pay is a relevant factor in imposing fines against individuals, the same rationale does not apply to corporations. This decision is an indication that moving forward, courts may set fines that would push a corporation into insolvency if they feel it necessary to deliver a strong message regarding the conduct of the corporation concerning worker safety.  Here, Justice Pepall went so far as to note that some corporations might otherwise "treat such a fine as simply a cost of doing business."

Furthermore, as noted in our prior blog post and repeatedly emphasized by the Court of Appeal, corporations cannot distance themselves from culpability on the basis that the acts were not those of senior management but rather employees lower down the corporate ladder, such as site supervisors.  Accordingly, those in the higher echelons of an organization should exercise awareness in the selection and training of competent supervisors, and continuously satisfy themselves that health and safety rules are being adhered to in the workplace.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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