05 Dec Employers are obligated to protect employees from themselves, RegQuest, vol. 2, No. 12 at 1-3, (December 1, 2009)
In Ontario, employers are responsible for the health and safety of employees in the workplace. Increasingly, employers are charged with a breach of the Occupational Health and Safety Act (“OHSA”), which is designed to protect employees against health and safety hazards at work. The OHSA establishes procedures for dealing with workplace hazards and empowers the Ministry of Labour to prosecute any person for a contravention of the OHSA. Convicted individuals can be fined up to $25,000.00 or imprisoned for a term of up to 12 months. Corporate employers are subject to a maximum fine of $500,000.00. Supervisors and managers are often found liable in addition to the corporate body.
For the most part, the OHSA creates strict liability offences, where the prosecution needs only to prove, beyond a reasonable doubt, the factual elements of the offence, leaving it open to the accused employer to avoid conviction by proving, on a balance of probabilities, that it exercised all reasonable care to prevent commission of the OHSA offence. The difficulty arises in situations where the accused employer contends that the accident was due to the injured employee’s neglect. While employers’ and employees’ neglect creates two separate nubs of liability, the accused employer will only be relieved of liability if it establishes that it was in no way negligent. The prosecution’s inquiry will be directed not at whether the injured employee may have been negligent, bur rather whether the accused employer used all reasonable precaution to ensure that its procedures for protection of employees were monitored and carried out. In other words, the injured employee’s negligence is no defence to the accused employer who fails to establish that it acted in due diligence to protect even the foolish, heedless or thoughtless workers.
In 2008, a related issue came before Mr. Justice Griffen in R. v. Goodyear Canada Inc. In this case, the employer, Goodyear, was charged with having failed to ensure that the employee locked-out a piece of machinery, which caused the employee injury. Justice Griffen found that the factual elements of the offence had been made out, but nonetheless acquitted Goodyear. He was satisfied that the employee’s careless actions occurred despite Goodyear’s due diligence in taking every reasonable precaution to prevent the offence. Later that year, in R. v. Petro-Canada, the same court found Petro-Canada guilty and fined it $150,000.00 for failing, as an employer, to take the reasonable precaution of having a procedure, which ensured that when a locking pin was removed from an overflow valve employees were not endangered by steam. As a result of the breach of Petro-Canada’s duty to protect, one of its employees suffered painful and disabling burns to various parts of his body. In 2007, in R. v. Toronto Transit Commission a $165,000.00 fine was imposed on the TTC, upon a guilty plea, involving seven workers working in a subway tunnel overcome by carbon monoxide from gas powered equipment. In 2006, in R. v. Woodbine Entertainment Group, a fine of $175,000.00 was imposed on an incident that involved a stationary engineer employed by Woodbine Racetrack who smelled gas and ultimately became injured. A survey of recent cases demonstrates that the courts are not adverse to imposing hefty fines for the OHSA violations. By imposing such fines the courts do not seek to punish employers for employees’ injuries, but rather to enhance the remedial and deterrent effects of the OHSA.
Another factor tending to raise the financial impact of a conviction on an employer is the statutory “victim surcharge”, which is imposed on fines levied under the OHSA, pursuant to section 60.1 the Ontario Provincial Offences Act (“POA”). The Ontario Regulation 161/00 made under the POA specifies that for fines over $1,000.00, the surcharge is 25%. Importantly, the surcharge is mandatory and is not taken into account by the courts when determining the appropriate fine. But just what factors do judges take into account when assessing the appropriate sentencing?
Factors Affecting Sentencing
The OHSA does not specify the factors that are to be weighed in assessing the penalty. In R. v. Cotton Felts Ltd., the Ontario Court of Appeal explained that the amount of fine will be determined by a number of considerations, which include: (1) the size of the company involved; (2) the scope of the economic activity in issue; (3) the extent of actual and potential harm to the public; (4) the maximum penalty prescribed by the statute; and above all (5) the need to enforce regulatory standards of deterrence. In light of the aforementioned decisions, one can add another factor: steps taken by an employer to avoid a violation of the OHSA.
To minimize the penalty, on a guilty plea, employers typically adduce evidence explaining and justifying the nature and extend of their health and safety programs. Therefore, one of the strong factors in favour of employers will be their efforts to comply with the standards and their regard for, or disregard towards, employees’ health and safety. The issue of whether evidence of ex post facto improvements to the employer’s safety policies and procedures should be admissible in the OHSA prosecutions remains unsettled. Prudent employers should take remedial measures to ensure the post-incident safety of their employees. It would allow employers and their managers to mitigate any potential penalty, which may be imposed upon them in any subsequent OHSA prosecutions.
The primary defence for the OHSA prosecutions is due diligence, which leads to the accused employer’s acquittal if it could be established that a reasonable person in the circumstances would have foreseen and took all reasonable steps to avoid the particular event. The OHSA does not impose a duty on the accused to anticipate every possible failure, but only to exercise reasonable precaution. For some violations, the OHSA provides for a statutory defence equivalent to the common law defence of due diligence. Specifically, section 66(3) provides that the accused employer will not be liable for a failure to comply with sections 23(1), 25(1)(b),(c),(d) or 27(1), if it can prove that it took every “precaution reasonable in the circumstances”. Can the due diligence defence be established in cases where compliance with the statutory requirements is, for example, prohibitively expensive for the accused employer?
The Ontario Court of Appeal decision in R. v. Nickel City Transport (Sudbury) Ltd. allows the defence of due diligence if it can be demonstrated that any efficient method to comply with the statutory requirement is prohibitively costly for the accused employer to afford or pass on to its customers. However, in 2005, the Ontario Superior Court of Justice in R. v. Canada Brick Ltd./Briques Canada Ltée, ignored the Nickel City case and instead adopted the Newfoundland Court of Appeal pronouncement in R. v. Alexander, that “as a matter of principle, it should be observed that arguments based on the expense associated with compliance cannot generally be sustained”. Arguably, in light of the Nickle City case, it remains open for the accused employer to invoke the “financial inability” argument in an attempt to make out the due diligence defence.
In addition to due diligence, the defence of “officially induced error” may be available to the accused employers, albeit it is rarely made out. This defence is available where the accused employer can prove, on a balance of probabilities, that it reasonably relied on the erroneous legal opinion or advice of a public official who is charged with administration and enforcement of the particular statute. In Maitland Valley Conservation Authority v. Cranbrook Swine Inc., the Ontario Court Appeal held that to succeed the accused employer needs to establish that: (1) it considered the legal consequence of its actions and sought legal advice; (2) the legal advice was given by an appropriate individual; (3) the legal advice was erroneous; (4) it relied upon the erroneous advice; and (5) reliance upon the erroneous advice was reasonable.
PRACTICAL SUGGESTIONS FOR EMPLOYERS
Prudent employers should ensure that those employees entrusted with directing how work is performed understand their, and their employer’s, OHSA obligations. Employers should ensure that their supervisory and managerial employees undergo recurring training on the OHSA compliance that is appropriate for their jobs. The training should include training with regard to the role and responsibilities of the Ministry of Labour and its Inspectors. It is essential that the corporate policies and procedures be put in place to address, inter alia, issues of how to:
- deal with employees invoking the right to refuse work under section 43(3) of the OHSA;
- respond to employees’ injuries or fatalities;
- interact with the Ministry of Labour and its inspectors. In this regard, a specific individual should be designated to deal with the Ministry of Labour and its inspectors;
- deal with the Ministry of Labour orders, issued for the OHSA violations;
- behave during the Ministry of Labour investigations to avoid allegations of obstruction;
- and act during the time the warrant is being executed. In addition, the policies should set out circumstances when the corporate employer will be required to retain an independent counsel to provide advice to its supervisors and managers and in which instances its officers, directors, supervisors and managers will be indemnified for legal fees and fines incurred in the OHSA prosecutions.