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BC Court of Appeal Reinforces the WorkSafeBC’s “Historic Compromise”

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Labour, Employment and Human Rights Bulletin

The B.C. workers’ compensation is a system of compulsory no-fault mutual insurance administered by the B.C. Government. It is frequently referred to as a “historic compromise” between workers and employers: workers lost their civil cause of action against employers but gained compensation that depends neither on the fault of the employer nor its ability to pay.

In a judgment issued on October 4, 2012, the B.C. Court of Appeal reasserted the principle of this historic compromise, and held that employers should be immunized from civil claims from workers in respect to accidents and injuries that arise in the course of employment.

In Downs Construction Ltd. v. Workers’ Compensation Appeal Tribunal, 2012 BCCA 392, the issue was whether a worker who failed to obtain workers’ compensation for a workplace stress related injury was entitled to sue her employer and a fellow co-worker for a common law breach of duty.

This matter should have been relatively straightforward. Section 10(1) of the Workers Compensation Act (“WCA”) bars an action in lieu of a possible claim under the WCA where the injury arose out of and in the course of employment. In conjunction, Section 257 of the WCA allows the WorkSafeBC Board to issue a certificate to confirm that a disability/injury/death occurred in the course of employment. The certificate effectively stops a civil claim from being pursued.

In this case, the worker claimed compensation for, among other things, post-traumatic stress disorder pursuant to the then-existing language of s.5.1 of the WCA (“Mental Stress”). The worker’s compensation claim was initially denied, and the denial was upheld at the Workers Compensation Appeal Tribunal (“WCAT”). The WCAT reasoned, however, that the finding that the worker was not entitled to compensation must lead to the conclusion that her injury was not sustained in the course of and arising out of her employment because s.5(1) requires the Board to pay compensation if an injury so occurs. As such, for purposes of s.257 of the WCA, the certificate should state that the injury did not occur in the course of employment. This, in turn, would effectively allow a civil claim to be pursued.

At the B.C. Supreme Court, the chambers judge agreed with WCAT’s conclusion in respect of s.257, and stated that to deny the worker a remedy, either under the WCA or in tort, would create a “black hole” for workers and be contrary to the legislative scheme. This was the key issue at the Court of Appeal.

The Court of Appeal rejected the chamber judge’s “black hole” analogy and provided a simple interpretation of s.5(1) and 5.1: “the former provision is general, and the latter is specific”. The chambers judge gave strong support to the principle that workers not successful in a WCA claim cannot then launch civil claims on the same underlying event and stated the following:

[24] In my view, it would undermine the core policy of the [WCB] scheme to have employers exposed to lawsuits based on the scope of compensable claims afforded to workers under the legislation. This would result in uncertainty and a patchwork system of compensation. It would result in proliferation of litigation to determine what is and what is not covered by the scheme in the context of the protection afforded to employers.

[26] I see little value in opening for debate whether particular claims not accepted for compensation should be available to workers as common law actions against an employer. In my view, that could be destructive of the basic framework of workers’ compensations schemes.

One issue that the Court of Appeal indicated may be subject to future legal determination, but did not resolve, was whether an employer’s immunization from civil claims extends to a claim that is not available under the WCA. For instance, a worker’s injury or disability not recognized by the Board or the WCA, but which may be recognized through tort jurisprudence, may be subject to civil litigation. While the Court of Appeal in obiter hinted that immunization should extend to such circumstances, that issue was not decided.

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