6 Pasiechnyk v Saskatchewan (Workers Compensation Board), [1997] 2 SCR 890 at para 25.

Transcription

1 PSYCHOLOGICAL HEALTH IN THE WORKPLACE: THE INCREASING BURDEN ON EMPLOYERS by Marino Sveinson, Katherine Cobban and Ian Hardie (summer student) Bull, Housser and Tupper LLP Introduction The costs associated with mental illness are staggering and only appear to be growing. The overall costs of mental illness to the Canadian economy in 2011 were estimated at $42.3 billion in direct costs and $6.3 billion in indirect costs. 1 Mental illness has a similarly negative effect on the workplace. A study prepared on behalf of the Mental Health Commission of Canada estimated that 21.4% of the working population suffers from a mental illness that could affect their work productivity. 2 This is a huge societal issue withemployers increasingly being required to bear its economic costs. Employers bear internal costs associated with mental illness in the form of absenteeism or presenteeism, 3 the latter being where an employee attends work but has lower productivity or performance. This paper will attempt to discuss some of the growing legal obligations causing employers to bear a disproportionate share of the societal economic burden associated with mental illness in Canada. Through changes to workers compensation legislation employers are required to fund workers compensation systems that have increased the scope of compensable mental health injuries. Occupational health and safety legislation increasingly requires that employers implement programs to protect the psychological health of their workers in the workplace, especially in the context of bullying and harassment. Common law decisions have also increased the burdens shouldered by employers in many respects. The outlook is not all dire for employers. For example, the decision of the Ontario Court of Appeal in Piresferreira v Ayotte foreclosed the possibility, in Ontario at least, of an employee suing for the tort of negligent infliction of mental suffering in the employment context. 4 In the workers compensation context, the Nova Scotia decision in WCAT # AD, although only a tribunal decision, provides good arguments for employer counsel when faced with constitutional or other challenges to compensation regimes that remain restrictive as they relate to stand-alone mental illness workplace injuries. 5 There are also some jurisdictional arguments available to 1 P. Smetanin et al. The Life and Economic Impact of Major Mental Illnesses in Canada: 2011 to 2041 (2011) RiskAnalytica, on behalf of the Mental Health Commission of Canada. 2 Ibid at Ibid at Piresferreira v Ayotte, 2010 ONCA 384 [ Piresferreira ]. 5 Workers compensation legislation provides coverage for physical injuries that arise in the workplace. If the physical injury also leads to a mental disability then generally the mental disability will also be compensable. This paper focuses on mental disabilities that arise or allegedly arise from workplace events or stressors with no physical injury or disability caused by the event. 1

2 attempt to limit liability and minimize forum shopping. Of course, initiatives like the new CSA National Standard (discussed below) are available for employers to try to rid their workplace of psychological harm. However, these initiatives are onerous and could lead to new obligations and liabilities for employers. Employer counsel should remain aware of the increasing burdens and obligations being imposed on employers related to addressing psychological harm and should give careful attention to limiting these burdens. Restrictions to mental health claims under workers compensation systems Workers compensation legislation establishes no-fault insurance systems. Workers have a right to compensation from the system that is not tied to the fault of the employer. Workers are barred from suing their employers for damages or injuries arising out of their employment. However, employers collectively fund the workers compensation systems including the costs associated with expanded coverage, successful claims and growing administration burdens. The Supreme Court of Canada referred to the advent of workers compensation systems, which originated in the early 20 th century, as the historic trade-off by which workers lost their cause of action against their employers but gained compensation that depends neither on the fault of the employer nor its ability to pay. Similarly, employers were forced to contribute to a mandatory insurance scheme, but gained freedom from potentially crippling liability 6 Mental disabilities are generally far more complex than physical disabilities. They frequently can be caused by a number of factors acting over the course of a lengthy period of time and can be difficult to manage and treat. For example, where stress is a cause of an employee s mental disorder it is likely that there are multiple sources of stress. Stress can exist in the employee s personal life as well as work life. Stress may arise because a worker is suffering from a physical injury sustained outside the workplace such as from a car accident. When a person enters into an employment relationship, he or she does not simply leave behind the stressors that pre-dated the employment or that are endured daily outside of work. While stress on one level or another is a reality of any workplace, the levels of stress that a person encounters in the workplace vary widely based on their occupation. The levels of stress in a person s private life can be equally as variable. How individuals respond to stress is equally as variable. The inherent complexity of mental disorders and the multitude of causes from which they can arise make the adjudication of workers compensation claims difficult. Employers are directly impacted by the outcome of this determination as well as the resources taken to reach a determination. In most Canadian common law provinces, workers compensation legislation restricts the compensability of stand-alone mental health claims to those arising from an acute reaction to a traumatic event. For example, 6 Pasiechnyk v Saskatchewan (Workers Compensation Board), [1997] 2 SCR 890 at para 25. 2

3 pursuant to Ontario s Workplace Safety and Insurance Act the scope of compensable mental injuries is restricted to mental injuries stemming from mental stress that is an acute reaction to a sudden unexpected and traumatic event arising out of and in the course of his or her employment. Additionally, workers compensation regimes generally contain an express labour relations exception so that a worker is not entitled to compensation if the mental stress was caused by the employer s decisions or actions 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. 7 These restrictions on mental stress claims were enacted by provinces in the period between 1992 and For example, in Ontario, the provisions restricting mental health claims to traumatic event claims were part of a broad overhaul of the province s workers compensation scheme in the late 1990s. The Workers Compensation Act, which was repealed on January 1, 1998, contained no restrictions on mental health claims. Faced with increasing expenditures for workers compensation claims generally, Ontario enacted the Workplace Safety and Insurance Act, which contains the restrictions on mental stress claims (stated above). 9 Similar restrictions were placed on the compensability of mental stress claims in the workers compensation systems of Newfoundland and Labrador 10, Nova Scotia 11, Prince Edward Island 12, New Brunswick 13 and Manitoba 14. British Columbia joined these provinces in restricting claims to those arising from traumatic events by amending the Workers Compensation Act in As was discussed by the British Columbia Court of Appeal in Plesner v BC Hydro, some of the factors that led to enacting the restrictive provisions were the legislature s desires to keep employer contribution rates similar to those in other provinces and to avert a looming budget deficit in the compensation fund. 15 Scope of the restricted approach to stand-alone mental disorders Most of the jurisdictions that legislated express restrictions to the scope of mental disorder claims to those arising from traumatic events have continued to exclude chronic or gradual onset stress claims. Workers 7 Workplace Safety and Insurance Act, 1997, SO 1997, c 16, Sch A s 13(5). 8 Katherine Lippel and Anette Sikka, Access to Workers Compensation Benefits and Other Legal Protections for Work-related Mental Health Problems: A Canadian Overview (2012) 101 Can J Public Health S16-S22. 9 Notably, the official objective of the changes was to shift the focus of the system from compensation to the prevention of illness and injuries: Ontario, Legislative Assembly, Official Report of Debates (Hansard), No. (9 October, 2007) at 1140 (Hon Elizabeth Witmer). 10 Workplace Health, Safety and Compensation Act, RSNL 1990, c W-11 s 2(o). 11 Workers' Compensation Act, SNS , c 10 s Workers Compensation Act, RSPEI 1988, c W-7.1 s Workers' Compensation Act, RSNB 1973, c W-13 at s The Workers Compensation Act, CCSM c W200 s Plesner v British Columbia Hydro and Power Authority, 2009 BCCA 188 at 52 [ Plesner ]. 3

4 compensation legislation is usually bolstered by policy that guides the actions of decision-makers in the compensation systems. For example, the Ontario Workplace Safety and Insurance Board policy document deals with the compensability of traumatic event mental health injuries under the Workplace Safety and Insurance Act [ WSIA ] discussed above. 16 According to the policy, in order for a worker to make a claim for a compensable mental injury under the WSIA, first, the worker must have experienced a traumatic event and second, the worker must have had an acute reaction to the traumatic event(s) resulting in the worker sustaining a DSM-IV diagnosis. The sudden and unexpected traumatic event must be clearly and precisely identifiable, objectively traumatic, and unexpected in the normal or daily course of the worker s employment or work environment. The range of examples provided for sudden and unexpected traumatic events include witnessing or being the object of a hostage-taking and being the object of harassment that includes physical violence or threats of physical violence. 17 The policy reiterates the statutory exclusion of claims for mental stress that arise gradually over time due to general workplace conditions. Likewise, the policy reinforces the s. 13(5) exclusion of claims arising out of an employer s decisions or actions relating to the worker s employment. Manitoba s The Workers Compensation Act excludes chronic or gradual onset mental stress claims by restricting the definition of occupational disease to stress claims arising from traumatic events in s. 1(1). 18 The Workers Compensation Board of Manitoba policy Adjudication of Psychological Injuries also restricts how accident is defined for the purpose of the Act. 19 As is the case for physical injuries under the Manitoba WCA, the compensable injury must be caused by an accident. The policy states that burn-out or stress arising from a situation where, for example, the worker has performed a difficult or demanding job for a lengthy period of time or has a difficult, demanding or unpleasant supervisor cannot lead to a compensable claim as the circumstances do not give rise to an accident. 20 Whither the restricted approach? British Columbia s Workers Compensation Act has recently joined the company of acts such as the federal Government Employees Compensation Act and Alberta s Workers Compensation Act by accepting claims for mental injuries arising from stressors other than those arising from traumatic even stressors. The federal 16 Ontario Workers Insurance and Safety Board, Traumatic Mental Stress (Claims policies), Document number Ibid. 18 The Workers Compensation Act, CCSM c W200 s Workers Compensation Board of Manitoba, Adjudication of Psychological Injuries (Benefits Administration Adjudication and compensation) Policy number Ibid. 4

5 Government Employees Compensation Act [ GECA ] which applies to federal government employees does not restrict mental health claims based on a traumatic event distinction. 21 Claims under the GECA are administered by the provincial workers compensation boards. Alberta s Workers Compensation Act has allowed for compensable claims for mental health disorders beyond the scope of traumatic event stressors for many years. 22 In its corresponding policy statement, the Alberta Workers Compensation Board addresses the circumstances under which a psychological injury will be compensable. 1. There must be a confirmed psychological or psychiatric diagnosis as defined in the most current version of the Diagnostic and Statistical Manual of Mental Disorders ( DSM ). 2. The condition must result from organic brain damage, an emotional reaction to a work-related physical injury, an emotional reaction to a work-related treatment process, traumatic onset injury or stress, or chronic onset psychological injury or stress. 3. To be compensable, the work-related injury must make a material, or significant, contribution to the worker s psychiatric or psychological injury. The policy statement also notes that stress is itself not a compensable medical diagnosis. Stress can, however, lead to DSM defined, and therefore compensable, diagnoses. 23 Furthermore, under the Alberta Workers Compensation Act policy, in order for chronic onset psychological injury or stress to be compensable, the emotional reaction must be to an accumulation of workrelated stressors, a significant work related stressor that has lasted for a long period of time, or a combination of the two. Unlike other forms of psychological or psychiatric injuries which only require that the injury make a material contribution to the worker s medical diagnosis, in order for a claim for chronic onset stress to be compensable, the work-related stressor or stressors must be the predominant cause of the psychological injury. Additionally, the work-related events from which the stress arises must be excessive or unusual in comparison to the normal pressures and tensions experienced by the average worker in a similar occupation. 24 British Columbia s recent amendment to s. 5.1 of the Workers Compensation Act brings it in line with Alberta s liberal approach regarding the scope of compensable stand-alone mental disorders. Up until 2012, s. 5.1 of British Columbia s Workers Compensation Act restricted psychological health claims to only allow mental 21 Government Employees Compensation Act, RSC 1985, c G-5 at s Workers' Compensation Act, RSA 2000, c W Workers Compensation Board Alberta, Application 6: Psychiatric or Psychological Injury, (Policies and Information) Policy Part II. 24 Ibid. 5

6 health claims where the mental stress is an acute reaction to a sudden and unexpected traumatic event arising out of and in the course of the worker s employment. Then, the constitutionality of s. 5.1 was challenged in Plesner v BC Hydro. 25 The circumstances that gave rise to this judicial driven expansion are notable for demonstrating the potentially wide scope of workplace compensable claims. In January 2003, Mr. Plesner, an auxiliary steam plant operator, heard a loud hiss at his workplace when a truck ran over a natural gas pipeline and caused it to rupture. It took employees some time to identify the source of the leak, but Mr. Plesner said that he could see a plume of gas that he thought was at least 100 feet high. During the subsequent evacuation of the plant, Mr. Plesner was fearful that the gas would ignite, causing a chain reaction. 26 He later visited his family physician who noted symptoms of stress. He was later diagnosed with post-traumatic stress disorder. His claim to the Workers Compensation Board was denied as were his appeals to the Review Division and the Workers Compensation Appeal Tribunal. WCAT determined that the gas rupture did not qualify as a traumatic event within the meaning of the Act. On judicial review to the BC Supreme Court, Mr. Plesner argued that the policy item that WCAT had based its findings on was unreasonable or, alternatively, that s. 5.1 of the Act was contrary to the Charter. Wong J. found that WCAT s reasons were internally inconsistent and returned the matter to WCAT without addressing the Charter argument. At the British Columbia Court of Appeal Mr. Plesner argued that s. 5.1 of the WCA, in conjunction with the policy guideline s descriptor of traumatic event, limited compensation to workers who had suffered mental health injuries as a result of workplace trauma and thereby discriminated against him on the basis of mental disability contrary to s. 15(1) of the Charter. The Attorney General for British Columbia argued that the distinction made between compensable and non-compensable injuries was not discriminatory. Madam Justice Ryan agreed with the Attorney General s argument and dissented from the reasons of the majority, finding that the distinction drawn between physically injured workers is not on the basis of an enumerated ground but on the basis of the manner in which the injury was acquired. 27 However, the majority of the British Columbia Court of Appeal found that the traumatic event requirement when read in conjunction with the corresponding Policy Item breached s. 15(1) of the Charter as it gave rise to substantive discrimination on the basis of mental disability. 28 It was reasoned that the law and corresponding policy were discriminatory because workers suffering from purely physical injuries only had to show 25 Plesner, supra note Ibid at para Plesner, supra note 14 at para Peter Eastwood, Jennifer Roper and Marino Sveinson, Mental Disorder Claims: the Bill 14 Amendments to the Workers Compensation Act and Related Issues (2013) Continuing Legal Education Society of BC [ Eastwood et al ]. 6

7 that they had suffered from a work-related injury, while workers suffering from purely mental injuries also had to show that their injury had been caused by a traumatic event which must have been akin to horrifying. 29 The majority observed that the provisions treating workers who suffered from purely mental injuries in a manner different than those suffering from physical injuries were an affront to their human dignity and devalue[d] them as human beings. 30 Notably, the majority clarified that s. 5.1(1)(a) did not, in itself, give rise to substantive discrimination but only did so when read with Policy as required by s. 250 of the WCA. In applying s. 1 of the Charter, the majority noted that the changes to the Workers Compensation Act introduced in 2002 were motivated by the legislature s desire to save costs associated with chronic stress claims and to clarify coverage for mental health claims. They held that neither of these considerations provided a pressing and substantial basis for overriding the s. 15(1) right. 31 The same day that the decision in Plesner was rendered by the British Columbia Court of Appeal, WorkSafeBC made effective policy changes to delete the statements that the Court of Appeal had found to be contrary to s. 15(1) when read in conjunction with s. 5.1 of the Workers Compensation Act. The expansion was not over. In 2012, Bill 14 s legislative amendments repealed the former s. 5.1(1)(a) of the Workers Compensation Act and provided that a worker is entitled to compensation for a mental disorder where the disorder is either a reaction to one or more traumatic events arising out of and in the course of the worker s employment or is predominately caused by a significant work related stressor including bullying and harassment or is caused by a cumulative series of work related stressors, arising out of and in the course of the worker s employment. 32 The corresponding policy, contained in WorkSafeBC s Rehabilitation Services and Claims Manual Volume II at C3-13:00, was also modified extensively. 33 The immediate result of these amendments is that the scope of stand-alone mental health claims has expanded significantly in B.C. The amended policy contained in the Rehabilitation Services and Claims Manual still makes a distinction between the causative significance test required for traumatic event claims compared to non-traumatic event claims. This distinction is similar to Alberta s choice of policy language. The policy establishes the lower threshold of causative significance for traumatic events, whereas for a non-traumatic event to lead to a compensable mental disorder, the significant work-related stressor(s) must be the predominant cause of the mental disorder. This 29 Ibid at Plesner, supra note 13 at para Ibid at para Workers Compensation Act, RSBC 1996, c 492 s WorkSafe BC, Discussion Paper: Bill 14 Mental Disorder Legislation, May 31, 2012 at page 3. 7

8 distinction could lead to further challenges to the legislation and policy which, if successful, would result in further expanded coverage. 34 A British Columbia approach in other provinces? Employers should seek to protect the restricted scope of compensability for stand-alone mental disorder claims from expanding in other jurisdictions such as Ontario, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, New Brunswick and Manitoba. While Plesner cannot be seen as good news for the premiumpayers of any workers compensation system, there is at least a silver lining in the Court of Appeal s reasoning that may be used by counsel who aim to distinguish from that decision. The Court of Appeal was careful to restrict their finding of a violation of s. 15(1) to the legislation when read in conjunction with the corresponding policy. While there is similar statutory language restricting compensability of stand-alone mental health claims in different provinces, the policy language can differ. Additionally, courts in other provinces may take a different approach to the constitutionality issue. The minority judgment in Plesner did not find a violation of s.15 of the Charter. Nova Scotia provides a good example. In WCAT # AD, an appeal to the Nova Scotia Workers Compensation Appeals Tribunal, the panel held that s. 2 of the Workers Compensation Act, which restricts compensability to mental disorders caused by traumatic events, drew a distinction on the basis of an enumerated ground, but the distinction did not amount to discrimination as it did not create a disadvantage by perpetuating a prejudice or stereotype. 35 The WCAT Panel concluded that the 1996 changes to the Workers Compensation Act were enacted to assist in maintaining the [Workers Compensation] system s financial viability. 36 The Panel distinguished from Plesner by reasoning that the British Columbia Court of Appeal s decision was based on both s. 5.1 and the corresponding Policy There was no similar policy corresponding in s. 2 of the Nova Scotia Workers Compensation Act. The Panel concluded as follows: The Panel cannot ignore the fact that to recognize gradual onset stress injuries would potentially open the floodgates to claims from workers who have experienced any level of stress in the workplace attributable to factors such as interpersonal relations, work conditions, disciplinary action, terminations etc. In those cases, the inherently subjective nature of the claim would require an 34 Eastwood et al, supra note WCAT # AD (6 December 2012) Nova Scotia Workers Compensation Appeal Tribunal. 36 Ibid. 8

9 assessment to determine work-relatedness that would be unwieldy at best, and at worst, almost impossible. The potential cost to the system is obvious. The decision in WCAT # AD is being appealed to the Nova Scotia Court of Appeal. 37 As of July, 2013, a date for its hearing has not yet been set on the Court s docket. A decision in favor of the appellant would represent another serious blow to the legislative exclusion of mental disorders arising from non-traumatic event stressors. For now, the decision can be seen as a glimmer of good news for employers and counsel to employers. It demonstrates that at least some tribunal decision makers are alive to the risk of over-burdening workers compensation systems with an expanded scope of compensable mental injuries. As experienced recently by WorkSafeBC following the Plesner decision and the subsequent changes to the Workers Compensation Act and its corresponding policy, the floodgates argument relied on by the Nova Scotia WCAT in WCAT # AD is no mere rhetorical flourish. WorkSafeBC has been inundated with claims for mental disorders since the legislative and policy changes were made. WorkSafeBC registered 873 psychological only claims coming from the top industry subsectors in For the period of July 1, 2012 to June 30, 2013, the newly created Mental Health Claims Unit registered 1813 claims from the same industry subsectors. 38 Approximately 70% of these claims are being denied by the initial claims officers. However, employer still have to incur the resource drain required to respond to these additional claims and ultimately pay for and manage the additional number of claims that are being accepted. It is not known how Nova Scotia s Court of Appeal will address the issue. However, the Workers Compensation Board of Nova Scotia has proposed amendments to their policy that would adopt a more modern and less restrictive approach. 39 While the Board s policy cannot undermine the statutory restrictions to traumatic event stressors, the Board has proposed that policy definition of a traumatic event no longer include the requirement that the person s response involved intense fear, helplessness, or horror. Bullying and Harassment a Workplace Hazard In addition to expanded scope of compensation for mental health injuries in workers compensation legislation, occupational health and safety obligations aimed at preventing psychological harm, bullying and harassment are spreading. These are mandatory requirements for employers (and other participants in the workplace). The remedial sections in occupational health and safety legislation are aimed at penalizing employers 37 Nova Scotia Workers Compensation Appeals Tribunal, Annual report for the year ending March 31, WorkSafeBC, Mental Disorders Claims Summary to June 30, 2013 (PowerPoint Presentation). 39 Nova Scotia, Workers Compensation Board, Program Policy Background Paper: Compensability of Workplace Stress (24 April 2013) at page 9. 9

10 who violate the provincial statutes. 40 For example, under the Ontario OHSA every person who contravenes or fails to comply with a provision of the Act, an order or requirement of an inspector or a Director or an order of the Minister is, on conviction, liable to a maximum fine of $25,000 or imprisonment up to twelve months. If the offender is a corporation, the maximum fine increases to $500, Canadian common law jurisdictions have been most frequently addressing psychological health and safety issues through bullying and harassment provisions in occupational health and safety statutes and regulations. Ontario s Occupational Health and Safety Act defines workplace harassment as engaging in a course of vexatious comment or conduct against a worker in a workplace that is known or ought reasonably to be known to be unwelcome. 42 The Ontario Act requires that employers prepare policies regarding both workplace violence and workplace harassment and review their workplace violence policy at least annually. Employers are also required to develop corresponding programs to implement the workplace harassment policy. Pursuant to s (2), such a program must include measures and procedures for the reporting of harassment and must set out how the employer will investigate and deal with incidents and complaints of workplace harassment. 43 Ontario s Ministry of Labour publishes guides outlining the rights and duties of employers and employees under the OHSA provisions regarding bullying and harassment. 44 The guide regarding workplace bullying and harassment reiterates the minimum statutory requirements for compliance with the OHSA and also refers to a guide published by the Occupational Health and Safety Council of Ontario titled Developing Workplace Violence and Harassment Policies and Programs: What Employers Need to Know [ OHSCO Guide ] for more information regarding the actual implementation of a program required by the OHSA. The OHSCO Guide states that compliance with the guide is not a requirement based on the OHSA; employers can use other processes to help them comply with the OHSA. 45 The OHSCO Guide identifies steps that employers can use to develop their workplace violence policies, including recognizing the hazard of workplace violence, assessing the risks of workplace violence, controlling the risks of workplace violence and continual monitoring of the workplace violence policy. 46 The OHSCO Guide addresses the implementation of workplace harassment policies by reiterating the OHSA 40 Martin Shain, Stress at Work, Mental Injury and the Law in Canada: A Discussion Paper for the Mental Health Commission of Canada, (2009) Mental Health Commission of Canada at page 73 [ Stress at Work ]. 41 Occupational Health and Safety Act, RSO 1990 s Occupational Health and Safety Act, RSO 1990, c O.1 s Ibid at s Ontario, Ministry of Labour, A Guide to the Occupational Health and Safety Act, (Queens Printer for Ontario, 2012). 45 Occupational Health and Safety Council of Ontario, Developing Workplace Violence and Harassment Policies and Programs: What Employers Need to Know, Online: < 46 Ibid. 10

11 statutory requirements and by advising employers to implement training programs regarding workplace harassment that could be integrated into existing training programs in the workplace or be stand-alone harassment training programs. Manitoba addresses psychological health and safety in its Workplace Safety and Health Act, and bullying and harassment specifically, in its Workplace Safety and Health Regulation. The Workplace Safety and Health Act includes in its specific objects and purposes (a) the promotion and maintenance of the highest degree of physical, mental and social well-being of workers and (d) the placing and maintenance of workers in an occupational environment adapted to their physiological and psychological condition. 47 Manitoba s Workplace Safety and Health Regulation contains proscriptive provisions dealing with harassment in the workplace. As is the case in the Ontario OHSA, the Manitoba Regulation places emphasis on the development and implementation of policies. The Regulation requires that an employer (a) develop and implement a written policy to prevent harassment in the workplace; and (b) ensure that workers comply with the harassment prevention policy. 48 Saskatchewan has some of the farthest-reaching occupational health and safety language regarding psychological health in the workplace. 49 The Saskatchewan Occupational Health and Safety Act, 1993 defines occupational health and safety as including the promotion and maintenance of the highest degree of physical, mental and social well-being of workers. 50 The Act requires that employers (a) ensure, insofar as is reasonably practicable, the health, safety and welfare at work of all of the employer s workers; and (d) ensure, insofar as is reasonably practicable, that the employer s workers are not exposed to harassment with respect to any matter or circumstance arising out of the workers employment. 51 Like the Ontario and Manitoba occupational health and safety statutes, Saskatchewan s Occupational Health and Safety Regulations, 1996 require that employers develop a written policy to prevent harassment. This policy must include, for example, the definition of harassment used in the Occupational Health and Safety Act, a statement that every worker is entitled to employment free of harassment, a commitment that the employer will make every reasonably practicable effort to ensure that no worker is subjected to harassment, and a description of the procedure that the employer will follow to inform the complainant and the alleged harasser of the results of the investigation Workplace Safety and Health Act, CCSM c W210 at s 2(2). 48 Workplace Safety and Health Regulation, Man Reg 217/2006 s Stress at Work, supra note 38 at page Occupational Health and Safety Act, 1993, SS 1993, c O-1.1 at s Ibid at s Occupational Health and Safety Regulations, 1996, RRS c O-1.1 Reg 1 s

12 In the federal setting, the Canada Occupational Health and Safety Regulations that address workplace violence are broad enough to cover bullying and harassment. Section 20.2 defines workplace violence as constituting any action, conduct, threat or gesture of a person towards an employee in their work place that can reasonably be expected to cause harm, injury or illness to that employee. An employer is required by the Regulations to develop and implement workplace violence prevention policy. Within this policy, an employer must dedicate sufficient attention to factors that contribute to workplace violence such as bullying and teasing. 53 In BC, the Occupational Health and Regulation relies on the Workers Compensation Act as its enabling legislation. WorkSafeBC policy often addresses occupational health and safety prevention issues. WorkSafeBC has recently resolved to make amendments to the Prevention Manual policy statements to address bullying and harassment. The policy amendments, which will come into effect on November 1, 2013, define employer, employee and supervisor duties regarding bullying and harassment in the workplace. 54 The policy statements flow from an employer s general duties pursuant to s. 115(1)(a) and (e) of the Workers Compensation Act, which require an employer to take all reasonable steps in the circumstances to ensure the health and safety of its workers and also to inform, instruct, train and supervise workers to ensure their safety and those of other workers. 55 Employers in British Columbia will have a clear duty under the Workers Compensation Act and its corresponding policy to take all reasonable steps to prevent, where possible, or otherwise minimize, workplace bullying and harassment. 56 If an employer is found to be in violation of s. 115, WorkSafeBC can impose administrative penalties pursuant to s. 196 of the Workers Compensation Act. 57 The policy s definition of bullying and harassment (a) includes any inappropriate conduct or comment by a person towards a worker that the person knew or reasonably ought to have known would cause that worker to be intimidated or humiliated, but (b) excludes any reasonable action taken by an employer or supervisor relating to the management and direction of workers or the place of employment. In conjunction with this employer duty, employers will be required to develop policies and implement programs addressing bullying and harassment in the workplace. Employers will also be required train workers and supervisors on how to respond to bullying and harassment. According to the Prevention Manual policy, WorkSafeBC considers that reasonable steps to prevent or minimize workplace bullying and harassment include developing a policy statement with respect to workplace 53 Canada Occupational Health and Safety Regulations, SOR/ s WorkSafe BC, Resolution of the Board of Directors, March 2013 Bullying and Harassment in the workplace new policies, at page Ibid. 56 Ibid at page 1. 12

13 bullying and harassment not being acceptable or tolerated, taking steps to prevent or minimize bullying and harassment, developing and implementing procedures for workers to report incidents, developing and implementing procedures for how the employer will deal with bullying and harassment, as well as informing workers of, and training workers on, the policies and procedures. For example, WorkSafeBC would consider bullying and harassment procedures to be reasonable where they include (i) how and when the investigations will be conducted; (ii) what will be included in the investigation; (iii) the roles and responsibilities of employers, supervisors, workers and others; (iv) follow-up to the investigation (description of corrective actions, timeframe, dealing with adverse symptoms etc.); and (v) record keeping requirements. 58 WorkSafeBC is also currently working on an online tool kit which provide resources and information on how employers, as well as supervisors and employees, can meet their obligations to prevent bullying and harassment. 59 Employers in BC should approach the development of a bullying and harassment policy with caution. The definition that WorkSafeBC has selected for its prevention policy is problematic. It excludes from the definition any reasonable action taken by an employer or supervisor relating to the management and direction of workers or the place of employment. This is an unfortunately narrow exclusion. Supervisors and personnel charged with managing human resources need to be able to constantly manage the workforce within challenging operations. The nature of bullying and harassment is not about reasonableness. It is about inappropriate or abusive conduct. The focus of a bullying and harassment definition should be on the manner in which a manager makes employment related decisions, not on the reasonableness of the managerial decision. Employers should be able to manage and direct their workers without second guessing whether their decisions are reasonable when viewed by a third party unfamiliar with their worksite. Decision-making can be wrong, and, therefore, unreasonable, but this does not make someone a bully or harasser on its own. Notably, the Prevention Manual s definition is just that, a definition. The policy does not stipulate that an employer must incorporate the Prevention Manual s definition into its workplace bullying and harassment policy for that policy to be considered a reasonable step to address the hazard. In fact, the Policy does not even require that an employer policy contain a definition of bullying and harassment. Employers are urged to adopt a definition(s) that does not focus on the reasonableness of managerial decision-making but rather excludes decisions of employers related to a worker s employment unless the manager or supervisor s conduct is carried out in an abusive or threatening manner or for other improper motives. 57 Workers Compensation Act, RSBC 1996, c 492, Part 1 - Workers Compensation Act at s Supra note 54 at page WorkSafeBC Policy and Regulation Division e-newsletter, Bullying and harassment tool kit, online: WorkSafeBC < 13

14 Additionally, the Rehabilitation Services and Claims Manual policy in B.C. expressly states that workplace stressors, such as bullying and harassment, do not include interpersonal conflict unless it is threatening or abusive. This is a very important distinction. Not every isolated incident of disrespectful or inappropriate behaviour should constitute bullying or harassment. Employers must have the power to investigate the true causes of conflict and, where appropriate, make findings that the behaviour is simply interpersonal conflict. The new bullying and harassment policy definition does not contain an exception for interpersonal conflict, but this does not prohibit employers in B.C. or elsewhere from incorporating such limits into their policies and procedures. The new voluntary CSA National Standard: A gift or a curse for employers? The procedural requirements imposed on employers by the various occupational health and safety acts and new bullying and harassment requirements could leave employers scrambling to design and implement new mental health programs and policies. A new voluntary standard for psychological health in the workplace has been developed by the Canadian Standards Association. Employers may consider adopting this standard in an effort to comply with their increasingly extensive duties relating to employee mental health in the workplace. However, employers must consider whether the implementation of this standard will assist their compliance efforts or lead to onerous and unnecessary policy requirements and perhaps even expanded liabilities. The first edition of the National Standard of Canada: Psychological Health and Safety in the Workplace Prevention, promotion and guidance to staged implementation [ National Standard ] was published in January, The National Standard was prepared by the national Canadian Standards Association [ CSA ] and the Bureau de normalisation du Quebec [ BNQ ] and was commissioned by the Mental Health Commission of Canada [ MHCC ]. 60 While a complete analysis of each requirement in the National Standard is beyond the scope of this paper, the following requirements imposed on organizations desiring to comply with the National Standard demonstrate its complexity and onerous scope. The National Standard sets out its definition of a psychologically healthy workplace as follows: The vision for a psychologically healthy and safe workplace is one that actively works to prevent harm to worker psychological health, including in negligent, reckless, or intentional ways, and promotes psychological well-being. 61 The cornerstone of the National Standard, set out in clause 4.1, is the requirement that an organization establish, document, implement and maintain a psychological health and safety management system in the 60 CSA Group and Bureau de normalization du Quebec, National Standard of Canada: Psychological Health and Safety in the Workplace Prevention, promotion and guidance to staged implementation, Mississauga: CSA Group, 2013 [ National Standard ]. 14

15 workplace [ PHSMS ]. 62 An organization must develop and document psychological health and safety targets that it wishes to meet. Notably, there are no concrete requirements for the composition of these targets. Nor is there a requirement that the organization meet its own targets in order to maintain compliance with the National Standard. 63 Section 4 further requires that management define and communicate the responsibilities and authorities of the PHSMS throughout the organization. 64 Management or the board of directors is required to outline their commitment to the development of a systematic approach for managing psychological health and safety. Like many of the provisions throughout the National Standard, section 4 has lists of requirements but few concrete steps to be taken. Other onerous compliance requirements include the implementation of a data gathering process aimed at tracking the psychological health of organization stakeholders 65 and the mandatory design and implementation of a system to manage changes that can affect psychological health and safety. 66 The type of changes that must be addressed are extensive and includes new products, significant changes to work procedure, changes to psychological health and safety strategies, changes to legal requirements that address psychological health and changes to work arrangements. Not only must there be a system to monitor psychological health and safety, there must also be a system to manage changes within the system to monitor psychological health and safety. Demonstrating the scope of the PHSMS, clause requires that an organization establish critical event preparedness processes. This involves the identification of events where psychological suffering could take place. These processes relate to both events that are internal to the workplace, including bullying and harassment, and external to the workplace, such as the death of a family member. 67 While there is a considerable amount of leeway given to organizations as they develop, implement and sustain their psychological health and safety system, the sheer amount of processes is onerous. What the National Standard lacks in proscriptive requirements, it makes up for in processes and systems, many of which are overlapping. 61 Ibid at page Ibid at page Ibid at page Ibid at page Ibid at page Ibid at page Ibid at page

16 Employers might want to think twice before adopting the National Standard. An employer adopting it would have to be careful to tailor the Standard s programs in a manner that meets the legal requirements in the employer s jurisdiction. The National Standard requires extensive programs and processes to monitor those programs. An Ontario employer who simply addressed bullying and harassment in its adoption of the National Standard would be ignoring mandatory provisions in OHSA dealing with violence. For example, under OHSA, if an employer becomes aware, or ought reasonably to be aware, that domestic violence that would likely expose a worker to physical injury may occur in the workplace, the employer is required to take every precaution reasonable in the circumstances to protect the worker. 68 An adoption of the National Standard cannot gloss over these important requirements. However, the situation might be different in a jurisdiction like Yukon which offers employers very little guidance on what exactly is required of them in order to meet their psychological health in the workplace obligations. For example, Yukon s workers compensation policy states that employers have a responsibility under the Occupational Health and Safety Act to take appropriate measures, as far as reasonably practicable, to ensure that the workplace is safe and without risks to health. 69 There are, however, no provisions in Yukon s Occupational Health and Safety Act dealing specifically with psychological health and safety. Employers are required to conform with the general duty under the Act to ensure that, as far as is reasonably practicable, the workplace under the employer s control is safe and without risks to health 70 ; but the policy does not give employers any suggestion, or even referral to any external resources, on how this should be done in the context of psychological health. Employers, essentially left in the dark in this case, may turn to the National Standard, which despite its extensive procedural requirements, would at least provide employers with some guidance. Will the National Standard create new liabilities for employers? A risk associated with the National Standard is that even if it is not incorporated into occupational health and safety legislation, it may begin to influence the direction of the common law or arbitration boards as it pertains to psychological health and safety in the workplace. Voluntary as it may be, it is possible that the National Standard may come to be seen as a gold standard of employee psychological health and safety in the workplace. To begin with, the CSA itself is well known for publishing standards that are incorporated into occupational health and safety acts and regulations. The fact that the National Standards are published by the CSA and are also commissioned by the Mental Health Commission of Canada creates a sense of considerable authority. The creation 68 Occupational Health and Safety Act, RSO 1990, c O.1 s Yukon Workers Compensation Board, Adjudicating Psychological Disorders, (Policies, entitlement) Policy Number EN Occupational Health and Safety Act, RSY 2002, c 159 at s 3. 16

17 of the MHCC was a response to a 2006 report of the Standing Senate Committee on Social Affairs, Science and Technology. The report advocated for the creation of the MHCC and also recommended that the commission work with employers to develop and publicize best management practices to encourage mental health in the workplace. 71 With all the clout behind the National Standards, the possibility is left open for enterprising employee counsel to use the Standard s extensive requirements to argue that, for example, an employee s properly diagnosed depression arose as a result of the employer s failure to develop a program to address the psychological issues that may arise when a new product line is introduced, as is required by the National Standard s clause Even if the employer has not adopted it, the National Standard could be used as an example of a best practice which the employer failed to meet. If such onerous compliance requirements such as the critical event preparedness processes in clause crept into common law or arbitral decision-making, employers would be faced with yet another set of obligations to contend with. Employers who adopt the National Standard or parts of it risk employee counsel arguing that onerous obligations to prevent psychological harm in the workplace have been incorporated into the employment contract by the Employer itself. Civil Courts: Increasing compensation up to legislative boundaries? Adjudicators have long recognized the important link between an individual s psychological health and their employment. As noted by the Supreme Court of Canada in Reference Re Public Service Employees Relations Act (Alberta): Work is one of the most fundamental aspects in a person s life, providing the individual with a means of financial support and, as importantly, a contributory role in society. A person s employment is an essential component of his or her sense of identity, self-worth and emotional well-being. Accordingly, the conditions in which a person works are highly significant in shaping the whole compendium of psychological, emotional and physical elements of a person s dignity and selfrespect.72 As legislatures have enlarged the scope of compensable injuries and heightened employers duties to prevent psychological harm in the workplace, courts have increasingly recognized a wider range of psychological 71 Parliament, Final Report of The Standing Senate Committee on Social Affairs, Science and Technology, Out of the Shadows at Last: Transforming Mental Health, Mental Illness and Addiction Services in Canada (Ottawa: 2006) at Reference Re Public Service Employees Relations Act (Alberta), [1987] 1 SCR 131 at para

18 harm arising out of or in the course of employment as a basis for an actionable right. This progress can be seen in judicial treatment of the level of psychological harm necessary to warrant the breakdown of the employment relationship and therefore stand as a basis for a constructive dismissal claim. In Honda v Keays the Supreme Court of Canada re-evaluated the approach of awarding damages for the manner of an employee s dismissal. Bastarache J., writing for the majority of the court in Keays, referred to the 2006 Supreme Court decision in Fidler v Sun Life Assurance Co. of Canada, where the Court determined that it was no longer necessary that there be an independent actionable wrong before damages for mental distress can be awarded for breach of contract. 73 Compensatory damages for breach of contract are available based on the classic articulation of contractual damages in Hadley v Baxendale: damages are recoverable for a contractual breach if the damages are such as may fairly and reasonably be considered either arising naturally... from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties. 74 Bastarache J. clearly stated that [d]amages attributable to conduct in the manner of dismissal are always to be awarded under the Hadley principle. If damages are compensable under the Hadley principle, they will not be awarded through an arbitrary extension of the notice period. Bastarache further clarified that the award of damages for psychological injury in the context of dismissal is meant to be compensatory. 75 The courts have long held that there is a fundamental implied term in employment contracts that requires employers to treat employees with civility, decency, respect, and dignity. 76 However as noted by the Alberta Court of Queen s Bench in Lloyd v Imperial Parking Ltd., the application of such a fundamental implied term appears to be part of the trend to establish a duty upon an employer to treat employees reasonably in all aspects of the labour process. 77 Formerly, extreme behavior was necessary to breach the implied term to treat employees reasonably. However, the level of behaviour, and employer culpability, has been getting progressively easier to establish since the 1990 s, as cases like Shah v Xerox 78 were determined. In Shah v Xerox, the plaintiff s claim for constructive dismissal succeeded based on the manager s unsubstantiated accusations, warnings about poor job performance, and unilateral style of supervision Honda Canada Inc v Keays, 2008 SCC 39 at para 54, [2008] 2 SCR Ibid. 75 Ibid at para Lloyd v Imperial Parking Ltd., 1996 CanLII (AB QB) at Ibid. 78 Shah v Xerox Canada Ltd, [1998] OJ No Ibid. 18

19 Increasingly, the doctrine is being applied to not only the actions of management, but also the inactions of management. Recently, the Ontario Superior Court of Justice found that an employee had been constructively dismissed as a result of workplace bullying involving offensive comments that included graphic descriptions of sexual acts between the employee and other employees. The Court held that the employer had failed to adequately investigate the allegations, effectively forcing the employee to resign. 80 Further, the employee does not necessarily need to inform employers of the psychological harm in order to form a basis for a constructive dismissal claim. In Cooke v HTS Engineering Ltd the Court held that failure to report abusive conduct does not preclude recovery (by way of severance) for a constructive dismissal claim. 81 The considerable jury award in Boucher v Walmart Canada Corp and Jason Pinnock 82 demonstrates not only a massive quantum, but also the effect of occupational health and safety regulations on a civil action. The jury awarded the plaintiff, Meredith Boucher, $1.4 million on the basis of constructive dismissal arising from workplace harassment and violence. Walmart was held directly liable for $1.2 million for punitive damages and intentional infliction of mental suffering, and $10,000 for not adequately addressing Ms. Boucher s allegations of assault. Boucher quit her job at Walmart in 2009 after allegedly enduring extensive verbal abuse, mostly from her manager, from whom $250,000 of her damages award is to be paid. Ms. Boucher had complained of the abuse to senior management but no acceptable action was taken. Counsel for the plaintiff used arguments based on the obligations relating to bullying and harassment imposed on employers by the Ontario Occupational Health and Safety Act to support her civil claim. While these provisions are not intended as grounds for civil liability, they were apparently used by the plaintiff s lawyer to support arguments about what constitutes appropriate workplace behavior. Walmart is currently appealing the decision. The courts have also recognized psychological harm arising from the workplace as a compensable claim in tort. Whereas early constructive dismissal claims founded on psychological harm were insufficient to also ground a claim in intentional infliction of mental distress, or to warrant aggregative or punitive damage claims 83, later decisions have made that leap. In Zorn Smith v Bank of Montreal intentional infliction of mental distress was founded on the callous disregard for the health of an employee [in a way that] was flagrant and outrageous Disotell v. Kraft Canada Inc., 2010 ONSC Cooke v. HTS Engineering Ltd., 2009 CarwsellOnt 8326 at para The case is unreported as the decision was rendered by a jury. See Ryan Copeland and Marino Sveinson, Big Jury Award Arising from Workplace Bullying, Online: CCH HR and Payroll Compliance, < 83 Shah v Xerox Canada Ltd [1998] O.J. No where a textbook example of bad employer-employee relations did not meet the threshold for punitive damages; or Lloyd v. Imperial Parking Ltd CanLII Zorn Smith v Bank of Montreal, [2003] O.J. No at

20 The impugned behavior was that the expectations that the employer placed on the employee required her availability well beyond normal working hours and failed to provide training for her position. The cynical critic may argue that, in essence, Zorn-Smith stands for the proposition that an employer can be liable for chronic understaffing. In British Columbia, the Sulz v. Canada (Attorney General) 85 decision, which was affirmed on appeal, 86 remains valid law in upholding a claim for negligent infliction of mental suffering arising out of the workplace. In 1988, Mrs. Sulz joined the RCMP as a police officer. She had good reviews and appeared to do well at her job. In 1994, a new supervisor was posted to her detachment. He treated Mrs. Sulz in an abrupt, demeaning and unfeeling way which, along with the conduct of two other employees, amounted to harassment over a lengthy period of time. However, the Court held that that conduct was not intended to produce the harm that it did. Therefore, Mrs. Sulz s intentional infliction of mental distress claim did not succeed. Considering both the RCMP s anti-harassment policies and her superior s actions, the Court found that Mrs. Sulz should be compensated for negligent infliction of mental distress which caused her serious psychological harm. The Court awarded damages in the amount of $950,000.00, made up of $125, for general damages with past and future wage loss making up for the rest. As the Court of Appeal did not squarely address the issue, negligent infliction of mental distress claims currently exist in British Columbia. This decision keeps open a potential source of employer liability for reasonably foreseeable harm especially where the employer is aware that the employee has a history of stress related triggers which could potentially result in psychological harm. Fortunately, the Ontario Court of Appeal has taken a different approach. In Piresferreria v Ayotte, the Ontario Court of Appeal refused to follow Sulz. 87 The Court found that negligent infliction of mental suffering was not available in the employment relationship. The Court held that the liability such a tort would impose would effectively require employers to take care to shield employees from any acts of other employees that might cause mental suffering. The Court held that this level of employer responsibility, or at least the imposition of such wide ranging liabilities, was not the subject of judicial intervention but more correctly was a choice for the legislature to make. 88 In future cases on the topic it is hoped that the reasoning in Piresferreria, rather than the reasoning in Sulz, will prove more persuasive for courts to follow in other provinces. As noted, the BC Court of Appeal did not squarely address the existence of the tort. Though the trial decision based its holding on the existence of the tort, 85 Sulz v Canada (Attorney General), 2006 BCSC Ibid. 87 Piresferreria, supra note 4. 20