Employer Dodges Penalty After Failing to Adhere to Re-Employment Obligations

by & Cristina Lavecchia, Editors

The Ontario Workplace Safety and Insurance Appeals Tribunal (WSIAT) recently addressed if and when a penalty should be imposed on an employer who failed to adhere to their re-employment obligations when it comes to employees who get hurt on the job. In this particular case, the Panel decided that a re-employment penalty would not be imposed on the employer, in part because the worker’s conduct played a substantial role in the termination of his employment.

Background

The worker was employed as a heating, ventilation, and air-conditioning service technician/mechanic. The employer was engaged primarily in construction. The worker was labeled a construction worker.

Just a little under a year of being employed with the employer, the worker was involved in a workplace accident.

The Workplace Safety and Insurance Board (WSIB) accepted the claim and the worker received loss of earnings (LOE) benefits from May 7-20, 2007. The worker returned to modified duties with the employer performing office-related tasks.

On February 7, 2008, the employer terminated the employee for cause, citing gross insubordination.

Per the worker, the employer had breached its re-employment obligations.

The WSIB case manager concluded that the evidence supports that the termination was not due to the work-related injury or the WSIB claim for benefits and adds,

Legislation indicates that once a worker returns to work after recovering from a workplace injury, the employer must keep the worker employed for at least six months. If the worker is terminated within the six-month timeframe, we assume that the worker was let go due to the injury unless the employer can prove that the termination was not due to the work-related injury or the claim for WSIB benefits.

Employers can rebut the presumption if they can show that the failure to re-employ, or the termination within six months of re-employment, was not caused in any part by the injury, or the claim for WSIB benefits.

The worker appealed the case manager’s decision.

The WSIB Appeals Resolution decision

The WSIB Appeals Resolution Officer (ARO) first had to decide whether this case should be adjudicated under the construction regulations, and if so, which construction regulations applied (1992 or 2008).

“Section 54(9) of the pre-1997 Act and O. Reg. 259/92 apply to determine a construction industry employer’s re-employment obligations. Section 41(8) of the WSIA provides for regulations concerning construction industry employers, and further provides that its application is not contingent on the length of a worker’s continuous employment. Section 41(9) of the WSIA provides that, until the requirements in s. 41(8) are prescribed, s. 54(9) of the pre-1997 Act and O. Reg. 259/92 continue to apply. O. Reg. 35/08 came into force in September 2008 but does not apply to accidents prior to September 1, 2008. Thus, s. 54(9) of the pre-1997 Act and O. Reg. 259/92 continue to apply in this case.”

The ARO concluded that the construction regulations did not apply to the adjudication of the case because the worker was not a “construction worker” under subsection 41(8) of the Workplace Safety and Insurance Act (WSIA).

The ARO explained that, outside of the construction industry, it is required, among other things, that the worker must have been employed continuously by the employer for a period of at least one year at the time of injury. However, because the worker in this case was employed with the employer less than one year at the time of his injury, the employer did not have a re-employment obligation to the worker. The worker’s re-employment appeal was denied.

The WSIB subsequently reconsidered the ARO’s decision. The end result was the same as the ARO’s first decision; in that the construction re-employment obligation regulations did not apply to the employer for the worker’s accident. Nonetheless, the ARO invited the parties to make further submissions regarding the thresholds to apply regarding whether the re-employment obligations applied to the employer.

In a third decision, the ARO rejected the arguments of the worker. The ARO concluded that for accidents occurring before September 1, 2008, a re-employment obligation only applies if the worker was continuously employed by the employer for at least one year prior to the date of the accident.

The Workplace Safety Insurance Appeal Tribunal decision

Subsequently, the matter was brought before the Workplace Safety Insurance Appeal Tribunal (WSIAT).

The issues before the WSIAT included:

  • Which statutory provisions govern the adjudication of the case? It was decided that subsection 54(9) of the Workers’ Compensation Act (WCA) and Reinstatement in the Construction Industry, O Reg 259/92 were applicable to determine the employer’s re-employment obligation.
  • Whether, at the time of the accident, the worker was a construction worker under the applicable legislation? It was concluded that at the time of the worker’s workplace accident, the worker was a construction worker.
  • Whether the employer breached its re-employment obligation? It was decided that the employer breached its re-employment obligation to the worker when it terminated the worker’s employment.

The WSIAT concluded that a re-employment penalty will not be imposed on the employer. The Tribunal looked at two approaches in this respect; one relied on the concept of a technical breach and the other applied the real merits and justice principle.

The factors relevant to the merits and justice in exercising discretion regarding the imposition of a penalty against the employer were:

  • the employer’s voluntary re-employment of the worker and assignment of modified duties;
  • the termination following the altercation; and
  • the lack of anti-injured-worker animus.

The WSIAT preferred the approach based on the real merits and justice, stating:

“…It does not make sense to resort to the concept of a technical breach, since that is predicated on a finding that a termination is not related to a compensable injury but, rather, to some other cause having nothing to do with the injury. If so, there would be sufficient evidence to find that the termination was unrelated to the injury and that there was no breach of the re-employment obligation.

The merits and justice approach starts with a finding that the employer did breach its re-employment obligations and then examines the circumstances leading to the termination to determine whether a penalty is justified. In this case, the Panel accepted the agreement of the parties and found that the worker’s conduct played a substantial role in the termination of his employment. In accordance with the real merits and justice of the case, no penalty should be imposed on the employer.”

Takeaway for employers

As explained by the Workplace Safety and Insurance Board, employers continue to have responsibilities to their workers who have a work-related injury or illness. They must maintain a relationship in a number of ways. This includes an obligation to help workers return to employment following a work-related injury or illness.

Employers must:

  • Maintain employment benefits for a period of one year from the date of injury for all workers who are absent from work because of a work-related injury/disease
  • Re-employ their workers, as described below, including accommodating the worker if required.

Re-employment requirements

If the worker has worked continuously for an employer for one year, and the employer normally employs 20 or more workers, the employer must offer to re-employ the injured worker in the pre-accident job, a comparable job or a suitable job.

The obligation to re-employ lasts for the earliest of:

  • two years after the date of the injury;
  • one year after the worker is able to do the essential duties of their pre-accident job; or
  • the date the worker reaches age 65.

The re-employment obligations prevail over a collective agreement if the re-employment obligations offer greater protection to the worker. In layoff situations, the duty to accommodate does not require employers to keep injured workers at work who have less seniority than their uninjured co-workers.

If an employer terminates a worker within six months of re-employment, the employer must show that the termination was not related to the worker’s injury.

If employers fail to fulfill their re-employment obligations, the WSIB can penalize them and make payments to the worker. Any re-employment penalty is considered an amount owing to the WSIB at the time the penalty is charged.

There are special rules for employers and workers in the Construction industry.

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