Canadian Safety Reporter

2 Canadian HR Reporter, a Thomson Reuters business 2017 CSR | March 2017 | News with respect to injured workers, and confirmed that employ- ers and workers may, in certain circumstances, agree to settle issues related to a workers' com- pensation claim without need for a full hearing. In the March 14, 2016, de- cision, the WSIAT held that, despite Ontario's Workplace Safety and Insurance Act, 1997 (WSIA) stating that any agree- ment between an employee and employer waiving the worker's entitlement to work- ers' compensation benefits is void, the employer and worker in question in this case would be permitted to jointly propose a settlement of outstanding is- sues to the WSIAT to resolve the matters without a contested hearing. The worker in question suf- fered a workplace accident on May 6, 2007. On Feb. 7, 2008, while on modified duties, the worker's employment was ter- minated for cause due to gross insubordination. The worker took the position that the em- ployer had breached its re-em- ployment obligation — and that the worker should receive pay- ments from the Workplace Safe- ty and Insurance Board (WSIB) as a result of such breach — due to the worker's employment being terminated less than 12 months after the injury, as re- quired of construction employ- ers under the former Workers' Compensation Act (WCA) and the current WSIA. Subsection 41(13) of the WSIA allows the WSIB the authority to impose a penalty of one year of the employee's earnings on the employer if the employer does not fulfill its obligation to re-em- ploy a construction worker fol- lowing a workplace injury. The instant decision was decided in accordance with a similar provi- sion in the former WCA. Given the amount of time that had passed since the accident, the employer's only interest was in ensuring that it would not be required to pay a penalty in ac- cordance with ss. 41(13) of the WSIA. On the first day of hear- ing, counsel for the worker and for the employer submitted a joint proposal to the WSIAT un- der which the employer would not be required to pay a penalty, while the worker would nonethe- less be eligible to pursue benefits from the WSIB following the WSIAT decision. The proposal included an agreed statement of facts which indicated that al- though the employer dismissed the employee for reasons relat- ed to the workplace injury and therefore contravened its re-em- ployment obligation, the reason for termination was unrelated to any anti-compensation animus on the part of the employer and thus no re-employment penalty should be levied. The WSIAT reviewed and accepted the joint proposal, de- ciding that no oral evidence was required and it was unnecessary to have a contested hearing on various other issues relating to the case. Technical breach vs. merits and justice The WSIAT has historically fol- lowed one of two divergent ap- proaches to justify its refusal to levy a re-employment penalty on an employer for terminating an employee's employment in con- travention of its re-employment obligation. • The first approach is what has been referred to in WSIAT de- cisions as a "technical breach," where the WSIAT deems that although the employee's em- ployment had been terminat- ed prior to the expiration of its re-employment obligation, the reasons for termination were not related to the com- pensable injury. In these cases, the WSIAT has found that the breach of the re-employment obligation was merely "tech- nical" in nature and the em- ployer therefore should not be subject to a re-employment penalty. • The second approach engages the WSIAT's discretion under s. 124 of the WSIA to refuse to impose a re-employment pen- alty if the merits and justice of a case so permit. This approach has been followed where the WSIAT determines that there was a breach of the re-employ- ment obligation because the termination of the worker's employment was in some way related to the injury, but that due to the specific circum- stances of the case, no penalty should be imposed. The WSIAT in this decision examined both approaches and determined that the concept of a "technical breach" was un- necessary. The WSIAT held that — contrary to prior deci- sions which found a technical breach — if the termination is not in any way related to the in- jury, there is simply no breach of the re-employment obliga- tion, "technical" or otherwise. Rather, a termination during the re-employment period must be in some way related to the in- jury for there to be a breach of the obligation. In such cases, the WSIAT may decline to impose a penalty on the employer if the imposition of a penalty would be inappropriate on the basis of the merits and justice of the case. The WSIAT used its dis- cretion to refuse to impose a re-employment penalty in the instant case because the merits and justice of the case so permit- ted. The WSIAT accepted that, based on the agreed facts set out in counsel's proposal, there was a breach of the re-employment obligation. However, it agreed that the merits and justice of the case dictated that no penalty be imposed on the employer be- cause the employer's reason for dismissal, although related to the injury, was unrelated to any anti- compensation animus. In the future, similar deci- sions by the WSIAT to accept a mutually agreeable settlement could potentially save employ- ers thousands of dollars in legal expenses, time spent before the WSIAT, and lost productivity — among other less-quantifiable costs — while also preserving judicial resources. The WSIAT's confirmation that the "merits and justice" ap- proach to determining that no re-employment penalty should be levied on the employer settles years of divergence in the case law. And it's a decision that could have far-reaching implications for lawyers practicing workers' compensation law for years to come. For more information see: • Decision 54/14, 2016 Carswell- Ont 4491 (Ont. Workplace Safety & Insurance Appeals Trib.). Joel Smith is a lawyer with Wil- liams HR Law in Markham, Ont., where he practices management- side labour, employment, and hu- man rights law. He can be reached at (905) 205-0496 ext. 224 or jsmith@williamshrlaw.com. Joel was co-counsel for the employer in the case discussed above. Re-employment < pg. 1 No anti-compensation animus by employer Credit: Shutterstock/VGstockstudio

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