Workers’ Comp: Charter Violation due to Age Discrimination?

Ontario’s Workplace Safety and Insurance Act has recently been successfully challenged as being offside the Charter due to its failure to treat mental distress claims in a manner similar to claims of physical disability.

Arguments then followed that the same legislation fails to offer equal protections to older workers.

Ontario’s legislation presently caps entitlement to workers’ compensation benefits at age 65 or for a two year period where the accident occurred after the claimant’s 63^rd birthday. The same two year limit also applies to persons who are injured after 65.

Further, the Act’s obligation to re-hire an injured worker ceases at age 65.

The present statutory regime has been in place since 1990, at which time the existing wage loss system was introduced. Ironically, prior to that date, from the introduction of the workers’ compensation system in 1915, the worker was entitled to a life time income for a permanent disability.

The revisions of the Act in 1990 came with an implicit presumption that age 65 brought with it a retirement date and at the time, a mandatory one. Perhaps stated more acutely, it was not then a violation of the Human Rights Code to terminate due to the worker reaching age 65.

When the Ontario Code was amended to this effect in December of 2006, a specific exemption was provided to except from its ambit the provisions of the workers’ comp statute. ¹ For this reason, the argument must be based on a Charter challenge as opposed to the Human Rights Code.

B.C. has amended its workers’ compensation statute to recognize benefits do not cease at age 65, by allowing the worker to defeat the presumption that benefits end at 65, by showing that they would have continued working beyond age 65.

Alberta allows for workers’ benefits past age 65, where supported by the evidence, to show that the worker would not otherwise have retired at age 65 or show that they have incurred further financial losses.

Saskatchewan’s legislation contained a similar term which limited the receipt of benefits to the age of 65. The Queen’s Bench in Zaretzki v Saskatchewan (Workers Compensation Board), a June 1997 decision of Zarzeczny J. found this provision to be a Charter violation, yet one which was saved by section 1 and the reasonable limit qualifier. The Court of Appeal agreed.

The Nova Scotia Workers Compensation Appeals Tribunal in 2002 considered this issue in a case in which the worker was injured at age 66 and was limited to a two year benefit entitlement. The law was found to be offside section 15 but saved by section 1 of the Charter.

The New Brunswick Court of Appeal in Laronde v New Brunswick concluded that the similar provision in its statute did not pass the first hurdle by showing a violation of the s. 15 Charter equality provision.

The decision of the Workplace Safety and Insurance Appeals Tribunal (512/06) which considered this issue and rejected the Charter argument in a 2-1 decision has recently been argued before the Divisional Court on a judicial review application.

The Office of the Worker Adviser, that is, of the Ministry of Labour, joined counsel for the employee in supporting the appeal.

The facts of the case showed the employee had suffered a workplace injury at age 63 in February of 2001. He was awarded benefits until age 65 in May of 2002 and a 37% non-economic loss. The employer then had in place a mandatory retirement policy at age 65, this being prior to the amendments to the Human Rights Act.

In February of 2003, the worker asserted that he had noted a second source of injury to the same February 2001 accident.

This application for benefits was initially denied and then allowed on first appeal, but limited to the two year period as set out in the statute to February 2003.

The majority decision of the Appeals Tribunal made several important findings. First, that the great majority of Canadians do retire at age 65 or earlier and secondly, that the scheme in question is one of insurance.

The expert witness called by the worker did testify that a large percentage of workers now intended to work past age 65, but this evidence did not carry the day.

Such a plan of insurance, it was determined, must be based on an actuarially predictive behaviour, which the evidence showed was, for the main, retirement at age 65 or sooner.

The employer maintained a policy of mandatory retirement, which allowed for the conclusion that the worker had no expectation of working past age 65. The Tribunal also noted that the worker had not shown any evidence of the worker’s intent to work past age 65. The majority also concluded that it was unlikely that the worker would have been unemployed or employed at the same level beyond age 65.

The majority decision found no Charter violation and in any event, had it done so, it would have been saved by section 1.

The dissent found a section 15 Charter violation, which was not saved by section 1 and would have allowed benefits until age 71.

An unsuccessful reconsideration was brought. The worker’s Judicial Review application was heard in December of 2014.

The facts of this case do not present the perfect context as the worker’s injury was prior to the Human Rights Code amendments and further the employer maintained a mandatory retirement policy.

How it can be maintained that the Human Rights Code amendment may apply to every aspect of life, save the workers’ compensation regime is, at the very least, bewildering.

The Divisional Court dismissed the judicial review application in its unanimous decision on December 17, 2014.

This court noted that the expert evidence called at the first level by the Attorney General was not reflective of a pattern of workers being employed beyond age 65:

Mr. Gorham testified that, in 2008, 9.8% of the labour force was over the age of 65. Mr. Gorham also testified that since 2003, while there had been a gradual increase in the percentage of the population over 65 who were still in the workforce, the level in 2008 was still very low.

[18]           Mr. Gorham also stated that the median income in 2007 of people over the age of 65 who reported income from earnings was $1300 a year. This meant that approximately one half of those persons had an income of less than $1300 and one half earned more than $1300.

[19]           It was Mr. Gorham’s opinion that while many Canadians express an interest in working past age 65, as of 2008, the reality was that relatively few of them did.

[20]           Mr. Gorham acknowledged that the elimination of mandatory retirement would likely affect people’s decisions about retirement. Significantly, he testified that even if 40% of Canadians over 65 remained in the workforce, this would not indicate that LOE benefits after 65 could be supported by insurance principles or by actuarial practice. In Mr. Gorham’s opinion, the more relevant fact was the level of the median income of those working.

[21]           Mr. Gorham testified that almost 90% of the workers injured after the age of 61 return to work within two years. This means that s. 43(1)(c), which replaces lost earnings for up to two years for those workers injured over the age of 63, does not disadvantage 90% of the members of that class.

[22]           Section 43(1)(c) does not exist in a vacuum; in any analysis of it some consideration must be given to the fact that s. 43(1)(b) contains a general working age limit of 65 years.

The court also determined that the loss of earnings claim was an insurance plan and not a social benefits scheme.

The decision also noted that the disadvantage afforded to workers who would have worked beyond age 65 was supported logically by the statistical evidence noted above.

The Act accordingly was found not to be offside the Charter and even had that been so, such a violation would have been saved by section 1.

This issue has not been addressed since 2014.

1. 2.1 (1) A provision of this Act or the regulations under it, or a decision or policy made under this Act or the regulations under it, that requires or authorizes a distinction because of age applies despite sections 1 and 5 of the Human Rights Code.  2005, c. 29, s. 7.