Canada: Human Rights Tribunal Of Ontario: Denying Workplace Group Benefits Coverage To Employees Aged 65 And Older Unconstitutional

The Human Rights Tribunal of Ontario (the Tribunal) has released a significant interim decision in Talos v Grand Erie District School Board1, concluding that a statutory provision allowing for the reduction and discontinuation of group health, dental and life insurance plans for employees aged 65 and older is discriminatory and unconstitutional. This decision may have a significant impact on employer group benefit programs in the future.


Mandatory retirement at age 65 has been prohibited as a form of employment discrimination under the Ontario Human Rights Code 2 (the Code) since 2006.However, the Code provides an exemption that permits employers to reduce or terminate employee benefit, pension, superannuation and group insurance plans for employees aged 65 and older. Furthermore, pursuant to its accompanying Benefit Plans Regulations, the prohibition on age-based differentiation regarding employee benefit plans under the Ontario Employment Standards Act, 20003 (the ESA) only pertains to employees aged 64 and younger. Consequently, the ESA effectively sustains the exemption in the Code regarding employees 65 and older (collectively, the Code Exemption).

Pursuant to the Code Exemption, the employer terminated Mr. Talos' membership in its extended health, dental and life insurance benefits plan, once Mr. Talos turned 65. Mr. Talos brought an application to the Tribunal, alleging discrimination on the basis of age under the Code.

In an initial interim decision, the Tribunal rejected Talos' allegation of discrimination, finding it had no reasonable prospect since the Code Exemption acted as a complete defence to any claim of discrimination regarding employees aged 65 and older. However, through filing a notice of constitutional question, Mr. Talos claimed the Code Exemption violated section 15(1) of the Canadian Charter of Rights and Freedoms (the Charter), which was not saved under section 1, as a justifiable limit. As a result, the hearing proceeded before the Tribunal only on the constitutional question.


Following a lengthy hearing, the Tribunal held that the Code Exemption amounts to prima facie discrimination on the basis of age, infringing Mr. Talos' equality rights under subs. 15(1) of the Charter. Furthermore, such an infringement was found to be unjustified under s. 1 of the Charter. The Tribunal held that the actuarial evidence presented in this case failed to demonstrate the necessity of such differential treatment on the basis of age.

The Tribunal first held that the differential treatment allowed under the Code Exemption distinguishes between employees over and under age 65 who perform the same work. Those over 65 are distinctly vulnerable to unequal compensation for identical service. While employees aged 64 and younger are protected from age-differentiated access to benefits based on actuarial evidence, the Code Exemption allows employees aged 65 and older to have their access to benefits diminished or eliminated without such justification and without any recourse. Consequently, the Tribunal held that the Code Exemption deprives employees 65 and older from challenging employers to demonstrate how the differential treatment is reasonable or bona fide, on an actuarial or other basis.

Moreover, the Tribunal held this age-based distinction resulted in various direct disadvantages for Mr. Talos, including loss of peace of mind and having to apply for needs-based government healthcare benefits. Notably, the Tribunal held that issues such as an employee's wealth and access to a pension following a lengthy career and membership in a union as well as his/her eligibility for other government benefits were all irrelevant regarding the question of whether his/her Charter rights had been infringed. Rather, the question for the Tribunal was whether employees like Mr. Talos are disadvantaged relative to their younger counterparts concerning access to employee benefits.

The Tribunal then considered whether the Code Exemption was justifiable to maintain the financial viability of the employees' benefit plans.

Firstly, the Tribunal rejected the argument that the Code Exemption's purpose was to facilitate private negotiations for optimal compensation in the absence of such benefits after age 65. Secondly, while the Tribunal recognized that maintaining the financial viability of workplace group benefit plans is a pressing and substantial objective, it found employees' rights are not minimally impaired by a categorical exemption for those aged 65 and older. Notably, the Tribunal found that providing benefits to employees aged 65 and older is not sufficiently financially prohibitive to employers to justify the rights infringement in denying such benefits outright. Consequently, the Tribunal held that the Code Exemption constituted an unreasonable limit under s. 1 of the Charter and thereby unavailable as a viable defence.


While the Tribunal lacks jurisdiction to declare the relevant legislative provisions constitutionally invalid, there is no reason to suspect the Tribunal will diverge from this decision in future cases of alleged age discrimination, and any possible challenge on judicial review will be lengthy. Consequently, there is some risk to employers that employees may challenge other age-related restrictions to benefit plans. Although the Tribunal's decision does not address long-term disability insurance, pension plans and superannuation funds, there may be similar challenges in the future to such employee benefits.

It must be borne in mind this is an interim decision, with the merits of the case yet to be determined. In other words, Mr. Talos has yet to prove that, in the absence of the Code Exemption, the school board's denial of benefits coverage constitutes age discrimination under the s. 5 of the Code, and the employer has not yet had an opportunity to provide its defence against that allegation. It should be noted the Tribunal stressed the lack of clear actuarial evidence establishing the need for age-based differentiations to maintain the financial viability of benefit plans. Employers should therefore consider presenting actuarial data if challenged about age restrictions in providing employee benefits.

While the legal issue in Talos is limited in scope, employers would do well to discuss its potential impact on their operations with legal counsel and insurance providers.

The authors are grateful to Liam McMunagle, law student, for his contribution to this legal update.


1 2018 HRTO 680 [Talos].

2 RSO 1990, c H19.

3 SO 2000, c 41.

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