Canada: Be Prepared To Pay: Massive Increases To Fines Under The OHSA And Other Important Changes Coming

Last Updated: December 8 2017
Article by Ryan Conlin and Jeremy Schwartz

The Ontario Government has made a number of significant changes to labour and employment legislation over the last few months. Many of these changes have received significant public attention such as the increase to minimum wage and the expansion of WSIB entitlement for mental stress claims. However, these are not the only changes on the horizon.

The government has proposed Bill 177, known as An Act to implement Budget measures and to enact and amend various statutes. This vaguely titled legislation includes a number of important changes to OHS law in Ontario.

Massive Increase to the Maximum Fines Under the OHSA

Under the current law, the maximum fine for a corporation under the OHSA is $500,000 and $25,000 for an individual. The government proposes to triple the maximum fines against corporations to $1.5 million dollars and quadruple the maximum fine against individuals to $100,000. This is the first increase to the maximum fines under the OHSA in many years, and thus it is not entirely surprising that the government has headed in this direction.

The maximum fines are reserved for what is often referred to as the "worst case, worst offender" situations. The maximum fine would generally be imposed against defendants with serious prior records or in particularly egregious cases.

However, one can expect that Crown Prosecutors will rely on these increases, assuming they pass as drafted, to seek significant increases to the range of fines imposed against defendants. We anticipate that fines will go up significantly for defendants if these amendments become law, which means that OHSA compliance will be even more business critical.

It should be noted that the maximum jail sentence for an individual will remain the same, at one year per count.

Important Change to the Limitation Period for Prosecutions

The current limitation period for prosecutions is 1 year from the date of the accident or contravention, and it is not uncommon for the Ministry of Labour to lay charges just as the limitation period is about to expire. Bill 177 proposes to revise that provision to instead say that the limitation period expires one year from the date of the contravention or one year from the day upon which an inspector becomes aware of the alleged offence (whichever comes later).

This would be an important change, as it would mean the limitation period does not run until an Inspector becomes aware of a contravention. It is our view that this amendment is in direct response to the decision of Ontario Court of Justice in R. v. Corporation (City of Guelph) et al., where charges against two individuals were dismissed when the wall of a municipal building collapsed five years after the construction project was completed. The Court found that alleged provision by the architect and the engineer of negligent or incompetent advice occurred years before the wall collapsed and thus the limitation period applied to the individual defendants. The amendment to the limitation period would likely have led to a different result in that case.

Another situation where this amendment would apply is when a contravention is not brought to the attention of the Ministry of Labour and ultimately comes to the attention of an Inspector years later. This amendment allows for prosecution of such older offences.

Inspectors Bound to Follow Ministry Directives

The Bill proposes to amend the OHSA to allow the Ministry to establish written directives for use by inspectors respecting the interpretation, administration and enforcement of the Act and the regulations, and the Act would require Inspectors to follow these directives.

This is an interesting amendment which we believe is likely being enacted to bring some consistency to legal issues which have been the subject of different interpretations by individual Inspectors. For example, it has been our experience that different Inspectors have different interpretations of the "Constructor" and "Project" definitions under the Act. In practice, this has meant that some Inspectors have treated project owners as "Constructors" even where the Owner has hired a general contractor. The interpretation of the "critical injury" definition by various Inspectors has also been a controversial issue in our experience.

The proposed legislation would require the directives to be consistent with the OHSA. It will be an interesting issue to see how Courts and Tribunals treat the written directives in terms of interpreting the legislation and regulations. It is unlikely that a Court would consider itself bound by the directives, particularly if the Court determines that the directive is inconsistent with the OHSA. However, there is no question that directives will likely have a significant impact on how the OHSA is interpreted in the future.

Expanded Reporting Obligations

The Bill proposes to amend the OHSA to require an employer to notify the Ministry of Labour if a joint health and safety committee or a health and safety representative has identified potential structural inadequacies of a workplace as a hazard to workers. This amendment is likely in response to the tragic collapse of the Algo Centre Mall in Elliot Lake.

The Bill also proposes to amend the OHSA to make some changes to the specific reporting obligations involving certain types of accidents at construction projects and mines. More interestingly, the Ministry would be given the power to impose additional reporting obligations by regulation. The specifics of these other reporting obligations have not yet been made clear.

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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