Adjudicators and Term Limits

Adjudicators who are appointed by cabinet order (variously referred to as Order in Council (OIC) or Governor in Council (GIC) appointees) have very little job security, beyond the term of their appointment. Historically, a reappointment was never guaranteed and the reasons for not being renewed in your position were not provided. The difficulty with a non-transparent system of renewal is that no one (including the adjudicator) knows the reason for a non-renewal.

Ontario instituted a new process for reappointments (or renewals) in 2006. The major reform was to limit appointments to ten years, subject to the recommendation of the Tribunal chair. The usual progression has been an initial 2-year term, a renewal for 3 years and a final renewal of 5 years. The only exception is for “exceptional circumstances in the public interest”. The full effect of this policy will hit the Ontario adjudication community in 2016, although the effects are already starting to be seen. Concerns have been raised about the policy and its impact by the Society of Adjudicators and Regulators (SOAR), the Ontario Bar Association and Ontario’s Ombudsman. So far, the Ontario government remains steadfast in its commitment to the policy.

A spokesperson for the government set out the rationale for the 10-year rule: “regular membership renewal fosters a diversity of perspectives, continually refreshes the appointee roster, and provides other qualified individuals with the opportunity to serve”.

SOAR conducted a study on the impact of the directive on term limits in February of this year. It focused on the likely impact of the Directive on larger adjudicative Tribunals (20 or more OIC appointees). SOAR gathered information from the Chair or Executive Director of the 17 identified tribunals. The study noted that some Chairs “see advantages” to term limits, while others believed that any advantages were outweighed by the sudden loss of their most experienced adjudicators.

The Directive does not provide for staggered implementation, so some Tribunals will suffer a loss of over 50% of their current complement of adjudicators. SOAR concluded that the Tribunals that will lose between 47% and 60% of their members as a result of the Directive are: the Workplace Safety and Insurance Appeals Tribunal; the Ontario Labour Relations Board; the Landlord and Tenant Board; the Consent and Capacity Board; the Human Rights Tribunal of Ontario; the Social Benefits Tribunal and the Criminal Injuries Compensation Board. It noted that these Tribunals are ones that require a high degree of subject matter expertise and have “historically relied on a cadre of experienced, long-term appointees”.

SOAR raised a number of implementation concerns related to how quickly those not renewed can be replaced (there have been reports that the appointment and re-appointment process in Ontario has slowed considerably in the past few years). SOAR also raised concerns about the vagueness of the exception to the rule (“exceptional circumstances in the public interest”) and noted:

In the absence of a clear explanation for the application of the exemption, the public and the uses of the tribunal may also not have confidence that the exemption is applied fairly. This, in turn, could lead to a lack of confidence in the independence of decision-makers.

SOAR made a number of recommendations relating to the implementation of the term limit Directive. One of the recommendations was that consideration be given to the alteration of the directive for those tribunals that require its adjudicators to have a particularly high level of subject-matter expertise and adjudicative experience, including exemption for some tribunals.

In June, Adam Chisholm and Paul Boshyk of McMillan, noted that there was “surprisingly little discourse on the impending changes that Ontario’s tribunals … will face”. Since that time, there has been more public discussion of the potential impact on the delivery of adjudication services in the province.

In an interview with the Law Times, the SOAR vice-president elaborated on SOAR’s concerns:

It will remove some of the most experienced adjudicators — the ones who are given the most complex cases to determine. It will remove the mentoring quality that they bring to more junior adjudicators. Unless the government ramps up or speeds up its appointment process, it will leave a bunch of vacuums in tribunals beginning in early 2016.

I think the government should stop and take a breath. I think they should perhaps think about either staggering how they want to implement this, or offer some exemptions to it for particular tribunals that rely on expertise, and generally have more of a dialogue with the administrative justice community.

In his annual report, the Ontario Ombudsman supported the concerns of SOAR and noted concerns with the potential for shortages in members on some tribunals and an overall decrease in the number of tribunal members with valuable experience. The Ombudsman reported that he had expressed serious concerns to the government about the need for careful planning to mitigate the impact of this rule on administrative tribunals and their operations.

The Labour and Employment Law and the Workers’ Compensation Sections of the Ontario Bar Association sent a joint letter of protest to the Ontario government about the policy.

The Law Times, in an editorial, stated that the government’s goals “are entirely reasonable” but that some flexibility was required in the short term. Chisholm and Boshyk also noted that “at first blush, this may seem like a positive directive” but noted the implementation issues highlighted by SOAR.

Ron Ellis has observed (paywall) that term limits also demonstrate that the government is not interested in career adjudicators. In a comment on the Law Times article, David Mullan writes:

The Divisional Court presumes that the province’s tribunals are experts. Appointment term limits not only discourages those who wish to make a career of administrative justice service but also deprives tribunals of the very benefits of experience and understanding that justify curial deference. This is a thoroughly bad idea.

There have been extensive debates about term limits on boards of directors in the business world. One of the concerns about long tenure on boards of directors is a loss of independence. One commentator noted that despite the potential benefits of mandatory director refreshment, “there is no strong indication that long-serving directors are not independent”. A “one-size-fits-all” approach to term limits on company boards would result in removing experienced, knowledgeable board members arbitrarily. It is also noted that long-tenured directors are often the most knowledgeable and offer stability, particularly during changes in senior management.

The Canadian Coalition for Good Governance, in submissions to the Ontario Securities Commission relating to women on boards, stated that it believed that a “robust evaluation process rather than term limits or retirement age is the best means of ensuring high quality board members, but perhaps boards will need to impose term limits or retirement ages in order to refresh themselves.” The Institute of Corporate Directors is also wary of arbitrary term limits. The ICD agrees that voluntary term limits can “act as a backstop against excessive tenure lengths”. However, mandatory term limits “could also be counter-productive to the good governance of Canadian organizations”:

Term limits are a blunt tool and, without flexibility, they eliminate effective as well as non-effective directors. For this reason, we believe boards must retain discretion to preserve vital institutional memory of high performing and contributing members.

On some boards, we have also observed that term limits can have the effect of replacing “tough conversations” with directors who no longer add value to the organization, therefore obviating the accountability inherent in identifying and addressing weaknesses. Boards should not “wait out” a poor director’s term, and instead, should be prepared to ask them to resign before their terms are finished.

There is strong support for term limits by some in the business community. Term limits have been introduced by major banks in Canada. The Bank of Montreal has a 15-year term limit. Robert Prichard, chairman of Bank of Montreal, justified the Bank’s term limits as an appropriate focus on renewal: “Even when all the directors are performing well, some renewal is desirable. A new director often brings fresh insights to the business and its governance.”

There have been criticisms of term limits on non-profit or charity boards of directors. Kim Jonker and William F. Meehan, two experts on board governance, state that they believe in limiting terms – but not in term limits. They suggest that each year, board members should evaluate their own, and each other’s, commitment to the organization. It is difficult and uncomfortable to have those conversations, especially with non-contributing members, but: “the alternative of imposing formal term limits will have the unfortunate effect of forcing out board members who continue to contribute at a high level.”

Meehan later noted that term limits “throw the baby out with the bathwater” and “no term limits without an aggressive governance committee leads to swampy bathwater.”

On paper, the British Columbia model for reappointment decisions addresses some of the concerns about renewal, without throwing the baby out with the swampy bathwater. Appointment Guidelines clearly note that reappointments are not guaranteed, but that an appointee may be considered for reappointment if performance has been satisfactory and there are “no other considerations that would militate against the reappointment”. The guidelines set out the factors for chairs to consider in assessing performance of adjudicators. In addition, the guidelines require the chair to balance “the benefits of expertise gained through experience against the fresh views that new appointees can bring to the tribunal’s work”. Chairs are also reminded in the guidelines of the government’s commitment to merit as the basis for all tribunal appointments and that “positions should be filled by candidates with the best qualifications to meet the tribunal’s requirements”.

However, it is not clear that the guidelines are always followed.

Some adjudicators will retire at the end of their terms. But for those of us who, against all logic, have chosen a career as an adjudicator there are significant challenges. Career adjudicators need to take control of their careers, and unfortunately it is not in the self-interest of Tribunals that they work for to assist. The kind of training and skills development needed may lead to good adjudicators moving on prior to the end of their terms, not something that Tribunals want. Some of the activities that can assist with networking and career development are either discouraged or prohibited. Activities such as speaking at conferences or engaging in social media, for example, are often subject to restrictions.

In addition, training in other areas of substantive law is not generally in the interests of a Tribunal. Ontario is experimenting with cross-appointments to other tribunals and this may allow for a longer career for an adjudicator but this is not yet an extensive practice.

In the short-term, the disruption caused by the sudden departure of adjudicators – and the loss of corporate memory and experience – will have to be managed by Tribunals. The hope remains that the government will use the “exceptional circumstances” provision in the Directive as a safety valve to slow the transition to manageable levels.

In the end, things will remain the same for adjudicators. In every jurisdiction they face job uncertainty. This is a challenge adjudicators must rise to by taking the initiative in managing their adjudication careers.