Canada: Co-Operative Federalism Reinforced: Workers' Compensation Rules Clarified

Last Updated: April 9 2014
Article by Gerald D. Chipeur QC

Parliament said that it desired a flexible approach to workers' compensation for federal employees across Canada when it passed the Government Employees Compensation Act, R.S.C. 1985, c. G-5 ("GECA").  The Supreme Court of Canada upheld that model of  flexibility for workers' compensation systems on March 28, 2014 in Martin v. Workers' Compensation Board of Alberta et al, 2014 SCC 25   ("Martin").

Justice Watson of the Court of Appeal of Alberta (Chief Justice Fraser concurring) provided a succinct synopsis of the Martin case:

Martin, a 33 year park warden, worked for Parks Canada at Banff. He was also a member of the Public Service Alliance of Canada. A prolonged dispute with Parks Canada began in 2000 when he complained that park rangers should be able to carry hand guns and other defensive equipment as a safety requirement under the Canada Labour Code. Martin asserts that, after filing his complaint in 2000, Parks Canada denied him training opportunities, assigned him to less challenging tasks, and generally "prevented him from performing the more pleasurable aspect of the work".

Martin was ultimately found by a workers' compensation board adjudicator to suffer from chronic onset stress.  However, in the view of the adjudicator, such stress did not meet the test for an "accident" covered by the Alberta workers' compensation plan.  On judicial review, the Court of Queen's Bench set aside the adjudicator's decision and returned the question of coverage to the adjudicator for a determination of whether the stress was covered under the GECA, without regard to the test for coverage under Alberta's workers compensation law and policy.

Prior to Martin, there were two conflicting lines of authority arising out of Canadian appellate courts.  Newfoundland and New Brunswick took the view that the GECA established a complete and unified code of eligibility for federal workers' compensation in all provinces.  All federal employees have to be treated the same under this theory.  On the other hand, Ontario, Nova Scotia and British Columbia concluded that eligibility for compensation under the GECA is determined in accordance with provincial rules, so that all employees in each province, including  federal employees, are treated the same.

In Martin, Court of Appeal of Alberta Justice Watson and Chief Justice Fraser (concurring) adopted the Ontario, Nova Scotia and British Columbia approach.  A unanimous panel at the Supreme Court of Canada agreed with Chief Justice Fraser and Justice Watson (Justice McDonald wrote a concurring opinion at the Court of Appeal level).

Both the Court of Appeal of Alberta and the Supreme Court of Canada saw the GECA as a victory for efficient and flexible federalism.  Justice Watson of the Court of Appeal of Alberta described the governing Canadian constitutional landscape this way:

The topic of balanced federalism is a fundamental and defining feature of the Canadian legal structure: Reference Re: Secession of Quebec, [1998] 2 SCR 217, 161 DLR 4th 385 at paras. 55 to 60.  Constitutional doctrine in this country should, to the degree possible, facilitate co-operative federalism, not search out conflicts: see e.g. Canadian Western Bank et al v Alberta, 2007 SCC 22, [2007] 2 SCR 3 at para. 24.  The interaction of federal and provincial legislation should be made workable by courts consistently with the intent of both levels of legislature.

Martin v. Workers' Compensation Board of Alberta, 2012 ABCA 248, at para. 42. 

Justice Karakatsanis, of the Supreme Court of Canada, picked up on the same theme of "cooperative federalism" in her reasons for decision:

The plan carried out through the GECA is cooperative federalism at work.  Provincial policies may define eligibility for compensation differently, but Parliament intended this flexibility.

Martin, at para. 52. 

Justice Karakatsanis summarized the law that will apply to federal workers' compensation at the very beginning of her judgment:

The provincial boards and authorities are required under the GECA to apply their own provincial laws and policies, provided they do not conflict with the GECA.

Martin, at para. 3. 

She went on to describe the GECA approach to compensation for federal workers in these words:

The GECA was intended to create parity between workers within a province and to rely on provincial law and administration.

. . .

I conclude that the Commission was required to apply provincial law and policy to determine the entitlement to and rate of compensation for an employee governed by the GECA.  The GECA incorporates provincial workers' compensation regimes, except where they conflict with the GECA.  It creates an efficient and consistent system so that federal and other workers within a province are generally compensated at the same rates and under the same conditions.

Martin, at paras. 17 and 19.

It is noteworthy that while the Supreme Court of Canada gave the province of Alberta wide latitude in defining an "accident", the Court thought that the definitions of "accident" in the GECA and the Alberta legislation were substantially the same:

Both include "a wilful and intentional act" of someone other than the claimant and a "fortuitous" or "chance" "event occasioned by a physical or natural cause."

Martin, at para. 46.

The Supreme Court of Canada concluded its analysis of the manner in which the GECA is intended to operate with two important points:

  1. Provincial workers' compensation law "supplements" the GECA "with structure and specificity" (Martin, at para. 49);
  2. Workers' compensation schemes in Canada follow the "Meredith model", a "historic trade-off" under which "workers lose their cause of action against their employers for workplace injuries, but gain coverage under a no-fault insurance scheme" (Martin, at para. 51);

The Supreme Court of Canada did not address Martin's argument that the Alberta definition of "accident" violated the right to equality under section 15 of the Canadian Charter of Rights and Freedoms (mental health injuries treated different from physical health injuries), as there was no proper record (the Court of Appeal of Alberta noted, at paragraph 34 of their decision, that notice of a constitutional challenge under the Judicature Act, RSA 2000, c J-2, s 24 had not been given).

In Martin, the Supreme Court of Canada determined that workers' compensation rules will be established in Canada on a province by province basis.  However, it left for another day the question of whether Alberta rules governing workers' compensation coverage for mental health injuries are consistent with the Constitution.

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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Gerald D. Chipeur QC
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