The Fundamentals

The law is clear that a civil action is not allowed where a claim may be made by the worker for workers’ compensation benefits. Against this seemingly simple concept, there are a host of complications that may arise.

It is very important to understand the nuances of the law on this subject, particularly on the employee side, as a step in the wrong direction may well deprive the employee of any remedy whatsoever, given time limits for commencing the correct action, particularly when that step is the filing of a workers’ compensation claim. Ontario sets six months as the time period for filing such a claim. Extensions may be possible.

Amendments to Mental Stress Workers’ Comp Claims

In January of 2018, the statute was amended to ease the burden for those applying for benefits based on emotional issues. Prior to this revision, the law, in essence, required a single event causing extreme distress, the example often being cited, as witnessing a colleague suffer a devastating workplace injury.

The legislation was revised to read as follows:

13(4)     Subject to subsection (5), a worker is entitled to benefits under the insurance plan for chronic or traumatic mental stress arising out of and in the course of the worker’s employment.

13(5)     A worker is not entitled to benefits for mental stress caused by decisions or actions of the worker’s employer 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.

These words “chronic or traumatic mental stress” dramatically revised the test.

The Repercussions

The question then became of the impact of this new definition of civil claims arising from allegations of workplace wrongdoing such as abusive behaviour or even claims of breach of the duty of good faith and fair dealing at the time of termination. A further question will be of the breach of the organizing principle of good faith as set out in the Supreme Court’s decision in Bhasin v. Hrynew, given that the remedy is one of aggravated or moral damages. Then there remains the question of the interrelation between human rights claims for compensatory damages where the employee is covered by workers’ compensation entitlement. This promises to be a tangled web indeed.

Given that Ontario’s population is surprisingly 70% covered by workers’ compensation law, these issues are strikingly important to define.

Precedent Case Statute-Barring Civil Claims

The Alberta courts in March of 2013 in Ashraf v SNC Lavalin ATP Inc. considered a motion brought by the employer to dismiss the civil action brought by the plaintiff in which it was asserted that he had been bullied by his co-workers.

The plaintiff sued for damages for mental anguish. No constructive dismissal claim was alleged. He then remained an employee and was in receipt of disability insurance benefits.

The employer motion was based on the proposition that the Workers’ Compensation Act applied, and hence no civil action was possible against the employer. The civil claim was based on the intentional and willful wrongdoing of the employer. As an aside, most statutes of this genre define a workplace “accident” to, ironically, include intentional wrongdoing.

The motion succeeded and the claim was dismissed. The claim was then successfully amended to include a claim of constructive dismissal based on this conduct on the first appeal. This decision was upheld by Mr. Justice Mahoney and again by the Alberta Court of Appeal. The employee was, however, allowed to assert that the abusive conduct was tantamount to constructive dismissal by the Court of Appeal.

Apart from the aspect of the constructive dismissal issue, the law has been fairly clear on this issue. It has been expected that, following the amendment to Ontario law, no civil claims for emotional damages based on employer intentional wrongdoing would be allowed in a civil case, given the workers’ compensation benefits in place.

Recent Ontario Decision

The process for determining whether a civil action is barred by the workers’ compensation regime is to seek such a remedy before the Tribunal of the Board.

The issue arose due to a civil action commenced by an employee who claimed that the bullying and harassment by her co-workers caused her mental distress. For this reason, it was clear that there was question with respect to her right to sue. This question was decided against her and this part of the claim was determined to be unenforceable by civil action. The punitive damages claim was also dismissed. The Tribunal, of course, cannot award punitive damages.

All this being said, the employee, as was the case in the Alberta decision, also alleged that this abusive behaviour caused the termination of the working relationship, giving rise to the usual claim for lost income for the notice period.

Notably, the Tribunal, however, also concluded that the claim of constructive dismissal arose from the same alleged abusive behaviour. The “nomenclature” of the claimed relief was not relevant, once this link had been established. Indeed, this was admitted in the claim as the foundation of the case.

What Does This Mean for Employees?

Plaintiff’s counsel faces a daunting task in this context. The workers’ compensation scheme does theoretically allow for claims based on “chronic or traumatic mental stress” yet few to date have been successful. Allegations of this nature in a civil action are certain to lead to a similar motion. This will require duplicate action, likely a civil action with an agreed stay, pending the disposition of the workers’ compensation claim.

Employers’ Take Away

The employer holds the ace cards in this context, that is presuming it is prepared to face a workers’ compensation claim and not a civil action. Premium questions may arise which exceed this present mandate.

We Are Not Yet Done

This issue is not yet fully discussed. There remains the question of the human rights regime and also civil claims brought against individuals for emotional distress, as opposed to the corporate employer. Stay tuned.

Get Advice and Know Your Rights

This subject is a minefield. It is glaringly evident that this is no place for amateurs. Get advice. For guidance on his issue, and indeed, on and all employment law matters, contact the offices of Toronto employment lawyers Grosman Gale Fletcher Hopkins LLP. We regularly advise workplace parties on a wide range of legal workplace issues. Contact us online or by phone at 416-364-9599 to schedule a consultation.