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Disabled workers must get equal benefits, says court

|Written By Kirsten McMahon - Law Times

Disabled workers in Ontario must get the same compensation asable-bodied workers, the Court of Appeal ruled in finding a section ofthe Employment Standards Act (ESA) violates s. 15 of the Charter.

Justice Russell G. Juriansz, writing for a unanimous panel, struck downs. 58(5)(c) of the ESA that allows an employer to deny severance pay toan employee whose ability to remain on the job has been frustrated byillness or injury.

The Court of Appeal also recognized that historically disabled workers have been disadvantaged, says Elizabeth McIntyre.
The Court of Appeal also recognized that historically disabled workers have been disadvantaged, says Elizabeth McIntyre.

Under the ESA, any company with a payroll of at least $2.5 million must give severance pay to a terminated employee with at least five years' service.

In Ontario Nurses' Association v. Mount Sinai Hospital, Christine Tilley, a neonatal intensive care nurse who had worked at Mount Sinai for 13 years, was dismissed in June 1998. Three years prior, Tilley had injured her knee in a water-skiing accident and shortly after suffered from depression and bulimia. After a number of unsuccessful attempts to return to the workforce in 1996, she relapsed and went on long-term disability.

Prior to being dismissed, Tilley's doctor advised her that she would be able to return to work, but didn't know when. She did not receive severance pay upon termination and the association filed a grievance disputing the termination and claimed the denial of severance pay violated s. 15 of the Charter.

"Obviously, not only did they recognize that with respect to severance benefits in particular that the ESA was contrary to the Charter," says Elizabeth J. McIntyre of Cavalluzzo Hayes Shilton McIntyre & Cornish LLP, counsel for the Ontario Nurses' Association.

"They also recognized that, historically, disabled workers have been disadvantaged, particularly in the employment setting and that employment status is significant in terms of our recognition as human beings and as members of Canadian society. In that respect, I think the case is an important one."

The arbitration board found Tilley's employment contract had been frustrated, and upheld the termination. It also upheld the constitutionality of s. 58(5)(c) of the ESA, on the ground that the differential treatment was not discriminatory.

On judicial review, the Divisional Court disagreed with the arbitration board's treatment of s. 15. The attorney general, who did not appear before the board or the Divisional Court, intervened at appeal to support the constitutionality of s. 58(5)(c).

The main and most interesting issue in the case seemed to be what the purpose of severance pay actually is. The hospital and the AG found severance is meant to be forward-looking and is intended to compensate workers as they move to find new employment. Employees with illness or injury wouldn't be likely to return to the workforce, they argued.

"I was very happy to see, even if they accepted the AG's argument as to what the purpose of severance benefits was, i.e. as a prospective assistance to help employees who are terminated to relocate, that even where a statute has multiple purposes, adverse discriminatory treatment in light of one purpose is sufficient to demonstrate a breach of s. 15," says McIntyre.

McIntyre says severance pay should be looked at as "sweat equity," as it's based on the number of years of service.

"You get a week for every year of service. It's always been thought of as sweat equity," she says. "But if they're right, the purpose, or part of the purpose, is to help those who have had their employment severed to bridge to new employment — where there's training, relocation, whatever — then surely it's the disabled who are going to need that kind of relocation assistance more than an able-bodied worker."

Douglas K. Gray of Hicks Morley Hamilton Stewart Storie LLP, counsel for Mount Sinai Hospital, says his client is somewhat surprised at the decision.

"It's hard to say whether it's consistent or inconsistent with the Supreme Court of Canada's dictates on what s. 15 of the Charter means and requires," he says. "My view, of course, is that it's not particularly consistent with what the SCC has ruled to date."

He says the ruling will have cost implications for not just Mount Sinai Hospital, but any other employer faced with similar circumstances.

No decision on appeal has been made yet, he says.

Juriansz found the assumption that disabled workers are unlikely to return to the workforce to be discriminatory.

"Employees with permanent disabilities may undergo retraining and acquire new skills, and new devices and techniques of accommodating special needs may be developed," he ruled.

"For example, in this case, Ms. Tilley was told she would eventually return to work, but the exact timetable was unknown," Juriansz said, noting Tilley found new employment following her termination.

McIntyre says she hopes the government accepts this decision and recognizes the provision in the ESA, and a similar one in the revised ESA 2000, has no place in Ontario's workplace law.

However, Christopher Diana, who practises employment law at WeirFoulds LLP, says this decision was based on the old ESA, and that the revised ESA 2000 has a section that speaks to the concern brought forward in this case.

He says he doesn't think the facts of Ontario Nurses' is really that significant considering the way the legislation has been amended. The amendment speaks to that concern, he says.

"The practical advice for all this is that employers have to be really careful in how they handle ill or injured employees and they have to make sure they act consistent with the Ontario Human Rights Code," Diana says. "If they don't, they face the prospect of increased damages from a Wallace bump-up or from punitive damages, as in the recent case [of Keays v. Honda Canada Inc.]"

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