Skip to Main Content

Benefits provision of the Human Rights Code violates the Charter, Tribunal finds

May 18, 2018

Human Rights Tribunal: Employers cannot cut off certain employee benefits at age 65

The Human Rights Tribunal of Ontario has held that a provision of the Human Rights Code which allows employers to exclude employees over age 65 from certain group benefits violates the equality right provisions of the Canadian Charter of Rights and Freedoms.

Background

In 2006, the Ontario Human Rights Code was amended to prohibit employers from imposing mandatory retirement policies. At the same time, a new provision was introduced that permitted employers to cut off certain group benefits – including life insurance and health coverage – for workers when they turned 65.

In 2012, Wayne Talos, a high school teacher turned 65 and his employer, the Grand Erie District School Board, cut off his health and dental benefits. He filed an application with the Human Rights Tribunal of Ontario in which he argued, among other things, that the Code’s provision constituted age discrimination in violation of the Canadian Charter of Rights and Freedoms.

The Respondent School Board and the Attorney General of Ontario argued that the provision authorizing the termination of benefits at age 65 was constitutional. They relied on a 1990 Supreme Court of Canada decision that upheld mandatory retirement, and on other decisions that followed it.

They also relied on actuarial evidence showing the cost implications of providing group benefits to persons over the age of 65, and invoked arguments based on the importance of the collective bargaining process. In particular, they submitted that the challenged provision encouraged collective bargaining between employers and unions, granting them the flexibility to negotiate over the scope of group benefits in the context of the overall needs and interests of workers. In their view, prohibiting bargaining over post-65 benefits would interfere with the constitutional right to collective bargaining for workers.

The Ontario Confederation of University Faculty Associations intervened to challenge these problematic arguments. In OCUFA’s view, the right to collective bargaining should not be used as a reason to justify discriminatory treatment of older workers. It introduced expert evidence demonstrating that, in practice, employers have been able to provide benefits to workers who are 65 and older without undermining the financial viability of benefit plans. The expert evidence also demonstrated that the reality of the collective bargaining process did not support the highly idealized and unrealistic picture painted by the Respondents’ experts.

The Tribunal’s decision

On May 18, 2018, the Tribunal held that the impugned Code provision was unconstitutional.

The Tribunal found that the impugned provision was discriminatory. It drew a distinction on the basis of age, and that this distinction created a disadvantage in terms of both financial and emotional costs associated with the loss of benefit coverage. As the Tribunal put it, “Being stripped of benefits at age 65 and older is not responsive to the needs of older workers” and instead reinforced the view that they were less valuable members of the workforce than younger workers.

After considering the competing actuarial evidence before, the Tribunal concluded that it is not cost-prohibitive to provide health coverage and modified life insurance benefits to employees who are 65 years of age or older. The Tribunal noted that the impugned provision did not require any actuarial justification for reduced benefits for older workers. A less impairing provision would be to require an actuarial justification for lesser benefits, which would permit workers to go to the Tribunal to challenge employer decisions to cut off benefits. As such, the provisions could not be justified as a reasonable limit on the equality rights of older workers under s. 1 of the Charter.

The Tribunal accepted OCUFA’s criticisms of the Respondents’ collective bargaining arguments. Indeed, during closing arguments, the Attorney General of Ontario was required to abandon those arguments. As the Tribunal noted in its decision, the Attorney General abandoned these arguments only “after OCUFA’s counsel articulated that ‘collective bargaining is a red herring in this case'”.

As a result, the Tribunal held that it would refuse to apply the impugned provisions of the Code in the proceeding before it. Instead, it would require the School Board to demonstrate that cutting off Mr. Talos’ benefits at age 65 fell within one of the statutory defences to discrimination under the Code (for example, demonstrating that providing such benefits would constitute undue hardship).

Read the decision here.

The Ontario Confederation of University Faculty Associations was represented by Emma Phillips and Daniel Sheppard.

Lawyers

Emma Phillips, Daniel Sheppard

Practice Areas

Constitutional Law, Human Rights Law