Canada: Mental Stress Claim Limits Ruled Unconstitutional In Ontario

In a significant decision of the Ontario Workplace Safety & Insurance Appeals Tribunal ("WSIAT"), the statutory limits on workplace mental stress claims have been judged an unconstitutional breach of equality rights under s.15(1) of the Charter of Rights and Freedoms ("the Charter").

Ontario's Workplace Safety & Insurance Act ("WSIA") provides no fault compensation to workers who suffer injury or disease arising out of their employment.  The general rule is that any kind of ailment will be insured under the Act, but reforms in 1998 restricted entitlement in particular circumstances:

Exception, mental stress

13 (4)  Except as provided in subsection (5), a worker is not entitled to benefits under the insurance plan for mental stress.

Same

13 (5)  A worker is entitled to benefits for mental stress that is an acute reaction to a sudden and unexpected traumatic event arising out of and in the course of his or her employment.  However, the worker is not entitled to benefits for mental stress caused by his or her employer's decisions or actions relating to the worker's employment, including a decision to change the work to be performed or the working conditions, to discipline the worker or to terminate the employment. 1997, c. 16, Sched. A, s. 13.

In WSIAT Decision 2157/09, released on April 29, 2014, the legality of these entitlement restrictions was put to the test.  The facts of the case involve a nurse subjected to abusive behaviour at work for a period of 12 years. She suffered mental health effects but her claim for benefits under the WSIA was repeatedly denied by the Workplace Safety & Insurance Board ("the Board") because the ailment did not arise as "an acute reaction to a sudden and unexpected traumatic event arising out of and in the course of his or her employment"  as required in subsection 13(5).

The worker appealed the decision and a three-member panel of the Tribunal heard the case over several days in 2013.  The Panel's decision 78-page ruling includes an examination of the history of workers' compensation, the purposes of the mental health exception in section 13, the historical prejudice against mental illness and ultimately, how Charter jurisprudence applies.  The decision gives considerable attention to the historical injustice visited upon persons with mental health conditions and very bluntly identifies the mental stress exception as an example of that injustice.

A summary description of the Tribunal ruling is this:

  • The statutory provisions create a distinction between different types of disability, in particular a distinction based on mental disability;
  • The provisions discriminate against persons with mental illness, by denying access to no-fault compensation and perpetuating false stereotyping;
  • The ability to sue privately for these injuries was insufficient to offset the disadvantage to workers, who ordinarily had the benefit of the no fault workers' compensation system;
  • Creating inequality that amounted to an infringement on equality rights under the Charter, the provisions were not saved by their alleged purpose (containing costs imposed on the Accident Fund) nor was the limitation on mental health claims proportional to that alleged purpose.

Consequently the Tribunal held that the mental stress exception constituted an unjustifiable infringement on equality rights under the Charter.  Based on that conclusion, the Panel declined to apply subsections 13(4) and (5) of the Act and allowed the worker's appeal.

Implications

While individual Panel rulings at the WSIAT do not bind other Panels, it is likely that the lengthy and comprehensive assessment of the mental stress issue in Decision 2157/09 constitutes the Tribunal's new standard.  What this may mean in Ontario is:

  • Any new mental stress claim will be adjudicated by the Tribunal, in the same fashion as any other claim;
  • Given that the mental stress exception is 14 years old, there may be a huge number of past litigants who will now look for a re-adjudication of their cases;
  • There is no obvious principled basis for the Board or Tribunal to refuse to re-visit those cases.  Certainly the Tribunal would have difficulty doing so;
  • Thus, any mental stress claim previously denied on the basis of subsections 13(4) and (5) may now be raised again, within the Board or at the Tribunal;
  • Any mental stress claim previously denied at the Tribunal, based on these provisions, is now fodder for a "reconsideration" request by past unsuccessful claimants.

Ontario trade unions, plaintiffs' counsel and workers advocacy groups will likely move quickly to revive old cases and to bring forward new ones.   Ontario employers, which pay premiums to support the Accident Fund, can anticipate escalating costs of claims and of course, the burden of managing and litigating those claims.  

In addition, the new ruling by the Tribunal will itself likely be contested by the Government of Ontario, which unsuccessfully defended the mental stress exception in the case.  The first stop for such a challenge is judicial review.   Such a challenge would undoubtedly scrutinize the Charter analysis done by the Tribunal.   

There is also the question of whether the Tribunal had the legal authority to take this approach to the provision.  When Ontario's Legislative Assembly passed the mental stress exception in 1998, it also enacted a strict limit on the Tribunal's independence:

Board policies

126.  (1)  If there is an applicable Board policy with respect to the subject-matter of an appeal, the Appeals Tribunal shall apply it when making its decision.

The Board has a longstanding policy pertaining to subsections 13(4) and (5) of the Act, a policy which assumes the constitutional legality of the statute and which offers guidance on how to apply the mental stress limitations in cases.  In Decision 2157/09, the Tribunal has given short shrift to this restraint on its independence and, by finding the provisions contrary to the Charter, has of course failed to abide by Board policy. 

Ontario's workers' compensation system would now appear to be open to mental stress claims hitherto denied by the Act.   Whether this opens a floodgate of old and new claims remains to be seen; one result, almost guaranteed, is that the issue will now be engaged by stakeholders and the Government of Ontario in what will be lengthy and complex legal proceedings for some years to come.

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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