Canada: When Is An LTD Claim Not An Insurance Claim? When It's A Labour Dispute

Last Updated: April 28 2017
Article by Patricia J. Forte


The Ontario Court of Appeal recently confirmed that a dispute about the termination of long-term disability ("LTD") benefits could not proceed by way of an action. The plaintiff's employment was subject to a Collective Agreement between the plaintiff's employer and her union. The Collective Agreement contained wording that was interpreted to grant exclusive jurisdiction over the dispute of a benefit entitlement to the labour arbitration grievance process involving the employer and the plaintiff through her union.

Barber v. Manufacturers Life Insurance Co.1

The plaintiff, Adrian Barber, became disabled from her employment as a police officer in 2009. The Collective Agreement governing Barber's employment required her employer, the Police Services Board, to offer disability insurance coverage to the members of the local police association. Barber applied for and received LTD benefits under a group Policy issued by Manulife. Barber's benefits were subsequently terminated in 2013. Barber started a lawsuit against Manulife in connection with the termination of her LTD benefits. Among other things, she claimed entitlement to ongoing LTD benefits.

Manulife brought a motion to dismiss the action on the basis that the court had no jurisdiction over the subject matter in dispute. Manulife was successful on its motion. In a four sentence endorsement, Justice Belobaba concluded that the court lacked jurisdiction to determine the dispute about the termination of Barber's LTD benefits. Justice Belobaba's decision was based primarily on the (undisclosed) language of provisions of the Collective Agreement referable to the employer's provision of benefit coverage, which he determined made the dispute "arbitrable". Barber appealed.

The Court of Appeal determined that Justice Belobaba's decision is correct and dismissed the appeal. Jurisdiction over the dispute belongs to an arbitrator. While neither the motion decision nor the Court of Appeal decision set out the wording of the Collective Agreement, the decision is based on well-established labour jurisprudence on point. At paragraph 9 of its reasons, the Court of Appeal states:

[9] Arbitration jurisprudence has developed a well understood method of deciding the arbitrability of benefit entitlement claims, which is to consider the four... categories [of Collective Agreement language] considered by the motion judge. ... The four categories are:

  1. where the Collective Agreement does not set out the benefit sought to be enforced, the claim is inarbitrable;
  2. where the Collective Agreement stipulates that the employer is obliged to provide certain medical or sick-pay benefits, but does not incorporate the plan into the agreement or makes specific reference to it, the claim is arbitrable;
  3. where the Collective Agreement only obliges the employer to pay the premiums associated with an insurance plan, the claim is inarbitrable; and
  4. where the insurance Policy is incorporated into the Collective Agreement, the claim is arbitrable.

These four categories were originally identified in the loose-leaf resource Brown and Beatty, Canadian Labour Arbitration. Canadian courts have adopted the "four categories" in previous cases.2

Neither Barber nor Manulife denied that the essential character of the dispute concerned LTD benefits. Instead, the issue was whether the essential character of the claim arose from the interpretation, application, administration or violation of the Collective Agreement or the LTD Policy. If the essential character of the claim arose from the Collective Agreement, an arbitrator, not a court, had exclusive jurisdiction to decide the issue.

Barber argued that her dispute fell within "category 3", which characterizes the dispute as "not arbitrable". The only obligations of her employer, Barber argued, were to offer long term disability coverage and remit premiums. The Police Service Board had fulfilled its obligations under the Collective Agreement and therefore there was no dispute arising under the Collective Agreement. Further, Barber argued that Manulife paid and then terminated her LTD benefits pursuant to the terms and conditions of the Policy. As such, the dispute arose from the Policy, not the Collective Agreement. Since the dispute had nothing to do with the employer, it was not arbitrable.

The Court of Appeal examined the applicable provision of the Collective Agreement and determined that it did more than merely oblige the Police Service Board to pay premiums for insurance, as argued by Barber. The language of the Collective Agreement covered terms, the amount of the disability benefits, the definition of "total disability" and made specific reference to the Policy. The Police Service Board could change insurers as long as the benefits defined in the Collective Agreement were continued. The fact that the LTD benefits were paid under the Policy did not change the fact that Barber's entitlement to the LTD benefits were "provided" by the Collective Agreement. In essence, Court of Appeal determined that because of the level of specificity about the employer's provision of the LTD benefit coverage in the Collective Agreement, the language demonstrated that the Collective Agreement was the "root of the contractual entitlement" to the relevant disability insurance.


This case has tentacles in both labour law and insurance law. In most cases dealing with a dispute about the cessation of an insurance benefit, it is natural to assume that the dispute is with the insurer that pays the benefit and makes determinations about entitlement. That is not always the case in a unionized workplace. When a disability insurance plan forms part of a Collective Agreement, disputes about entitlement to LTD benefits could be determined by the dispute resolution process under the Collective Agreement.

A necessary step in the litigation of disability claims is to determine whether the group member (the employee) is a member of a union. If so, the wording of the Collective Agreement about the employer's provision of LTD benefit coverage should be reviewed. In general, if the language of a Collective Agreement suggests that the employer must pay for the LTD benefits, the claim will likely have to proceed through grievance arbitration because the employer has mandated or contractually agreed to "provide the benefit". On the other hand, if the language of the Collective Agreement suggests that the employer bears no responsibility to pay the insurance benefits, but merely sets out the obligation to pay the premiums of an underlying policy, or if no specific plan is referenced in the Collective Agreement at all, it is more likely that a dispute about LTD benefits will not involve the employer. In the latter case, the claim would proceed in the court.


1 [2016] O.J. No. 4006 (S.C.J.), affirmed 2017 ONCA 164 (CanLII).

2 See: Weber v. Ontario Hydro, [1995] 2 S.C.R. 929, at paras. 11, 52, 54; London Life Insurance Company v. Dubreuil Brothers Employees Association, 2000 CanLII 5757 (ON CA), at para. 10, leave to appeal to S.C.C. dismissed.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Patricia J. Forte
In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions