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Covid-19 | Bulletin

Possible Consequences of Non-Compliance with the Government Order Concerning Non-Priority Services

Fasken
Reading Time 10 minute read

On March 24, 2020, in response to the COVID-19 pandemic, the Québec government adopted order in council 223-2020 (the “Order”), ordering the suspension of all workplace activities in Québec, except for those providing priority services. This suspension of activity is to remain in effect until April 13, 2020 and could be extended.

Priority services that can be maintained are specified in the schedule of the Order, which has been updated since being adopted.[1] Businesses providing non-priority services, except for stores, may maintain the minimum operations required to ensure the resumption of their activities.

Following the announcement and the coming into force of the Order, a number of Québec businesses had to determine whether their activities could be maintained. This determination can lead to serious consequences and this bulletin seeks to raise awareness among business owners regarding the liability they may incur, such as:

  • fines imposed under the Public Health Act[2];
  • being issued a notice of offence, and even, in certain circumstances, arresting employees in a position of authority under the Code of Penal Procedure[3] and the Criminal Code[4];
  • fines imposed under the Act Respecting Cccupational Health and Safety[5];
  • personal liability, both contractual or extra-contractual, of directors and officers of a business corporation;
  • criminal liability of a business under the Criminal Code for failing to take the necessary measures to avoid bodily injury arising from performing any work or task.

Public Health Legislation

The Order was passed under the Public Health Act,[6] which allows public authorities to declare a state of public health emergency and to implement various measures such as closing educational institutions or any other public place[7], or prohibiting access to all or part of the territory or allowing access to only certain persons and in certain conditions;[8] the purpose of such measures being to protect the health of the population.

The Public Health Act contains provisions regarding sanctions that may apply if the imposed measures are contravened. For example, under section 139 a fine of $1,000 to $6,000 may be imposed for refusing to obey an order of a public authority. Those who help, encourage or authorize such an action may also be liable to the same penalty.[9] In the case of any subsequent offences, these fines may be doubled.[10]

Section 75 of the Code of Penal Procedure[11] applies when a peace officer determines that a person has committed an offence under a provincial law, such as the Public Health Act. This provision allows the officer to arrest the individual who has committed the offence if doing so is the only reasonable means available to allow the officer to put an end to the commission of the offence.

As such, employees in a position of authority in a business that is maintaining workplace activities, despite formal notice to the contrary from any law enforcement agency or public authority, may be issued a notice of offence or even arrested.

In addition to the power to arrest provided in the Code of Penal Procedure, the peace officer may also arrest an individual for obstructing the work of a peace officer, under section 129 of the Criminal Code. This could apply if, for example, an employee in a position of authority in a business refused to suspend operations despite the express request to such effect by the peace officer. It should be noted that the consequences related to a criminal offence may have serious consequences if the person is found guilty, especially with regard to travelling to the United States or abroad.

Occupational Health and Safety Legislation

The purpose of the Act respecting occupational health and safety[12] (the “AOHS”) is the elimination, at the source, of dangers to the health, safety and physical well-being of workers[13]. The employer must take the necessary measures to protect the health and ensure the safety and physical well-being of workers and, to do so, must use methods and techniques intended for the identification, control and elimination of risks to the safety or health of workers.[14]

The notion of “danger (or hazard)” refers to a real threat whereas the notion of “risk” refers to an event that could possibly occur, but is not certain to occur.[15] As a result, an employer must not only take reasonable measures to eliminate dangers, but must also prevent risks related to occupational health and safety.

A CNESST inspector may require the closure of a workplace where an employer is not complying with the guidelines issued by the government and is not addressing the biological risk related to COVID-19.

Moreover, an employer that contravenes any provision of the AOHS may be subject to fines ranging from $1,500 to $3,000.[16] However, if it is shown that the employer, through any act or omission, acted in a manner that directly or seriously compromises the health, safety or physical well-being of a worker, that employer may by subject to a much higher fine of between $15,000 to $16,000.[17] These fines may be doubled in the case of any subsequent offences.

AOHS offences are strict liability offences, meaning that it is not necessary to prove mens rea on the part of the employer. It is sufficient to prove a material objective fact for which the consequences will directly and seriously compromise the health, safety or physical well-being of a worker. The existence of a danger is sufficient without it being necessary to prove that it did lead to the consequences.

In order to help prove that such offences were committed, the AOHS sets out a presumption to the effect that the employer is responsible for actions that are committed by its representatives.[18] It also provides that any director, officer, employee or representative of the business, who ordered or authorized an action to be performed that led to the commission of an offence is presumed to have participated in the offence, and is also liable to a fine.[19]

To ensure the control of risks related to COVID-19, an employer must comply with all public health recommendations and take all other necessary and reasonable measures.

As such, the Order is a public health measure and, by complying with it, an employer controls the risks related to COVID-19. The notions of “priority services” and “minimum operations required to ensure the resumption of activities” must therefore be interpreted to take into account the obligation to protect the health and safety of employees.

An employer that maintains activities under the Order must also take all reasonable and necessary measures to:

  • enable workers to work remotely;
  • ensure compliance with public health measures;
  • apply social distancing measures;
  • ensure that a worker stays home if infected with COVID-19, if exhibiting signs of COVID-19, or if they were in contact with a person infected with COVID-19.

The CNESST (Commission des normes, de l'équité, de la santé et de la sécurité du travail) also recommends that employers establish a policy regarding going to work with signs and symptoms of infection during a pandemic.

By complying with these measures, an employer that continues operations, whether or not a priority service, in accordance with the Order reduces the chances of the employer, including its representatives, facing a penal proceeding under the AOHS and being ordered to pay the applicable fines.

Civil Liability of Directors and Officers

Directors and officers of business corporations are subject to many obligations in exercising their duties, such as the duty of care and fiduciary duty.[20]

Duty of care involves exercising the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. In Peoples Department Stores Inc. (Trustee of) v. Wise, the Supreme Court of Canada summarized this duty as follows:

[67] Directors and officers will not be held to be in breach of the duty of care under section 122 (1) b) of the CBCA if they act prudently and on a reasonably informed basis. The decisions they make must be reasonable business decisions in light of all the circumstances about which the directors or officers knew or ought to have known.[21]

Duty of care may therefore include informing oneself as to the decision to be taken; for example, the duty to inform oneself regarding the application of the Order.

As for fiduciary duty, it involves ensuring the primacy of the interests of the corporation, regardless of any pressure or influence, and not to place it in a conflict of interests.[22]

Directors or officers who contravene their duty of care or fiduciary duty may incur contractual liability with regard to the business (art 1458 CCQ). They may also incur extra-contractual liability toward third parties when they commit any personal extra-contractual default in respect of the latter (art 1457 CCQ). This would apply in the case of any director or officer who actively participates in any extra-contractual fault committed by the business [23] or who breaches his duty of care and causes harm to another. In such a case, their capacity as director or officer will not prevent them from incurring their civil liability.

In the context of the COVID-19 pandemic, directors or officers could be subject to legal proceedings if they contravene the Order, whether wilfully or through negligence, and in doing so cause harm to the business, its shareholders, its employees or even third parties.

Criminal Code

Lastly, the Criminal Code expressly provides that anyone who undertakes, or has the authority, to direct how another person does work or performs a task is under a legal duty to take reasonable steps to prevent bodily harm to that person, or any other person, arising from that work or task.[24]

Circumstances that will give rise to the application of the provisions relating to criminal negligence[25] under the Criminal Code are as follows:

  1. the employer does or does not do something that it is required by law;
  2. the employer’s actions show a wanton or reckless disregard for the lives or safety of other persons; and
  3. these actions cause bodily harm or the death of any person(s).[26]

Accordingly, a business may incur criminal liability if direct consequences, such as death or bodily injury, arise from its failure to comply with the Order. In such circumstances it will only be necessary to prove that a prudent employer in the same circumstances, would have recognized that there was an obvious and serious risk.

Moreover, section 22.1[27] of the Criminal Code facilitates a public ministry’s ability to prove the negligence of a legal entity. This provision creates a presumption to the effect that a business has acted negligently if such negligence results from a decision by any member of its senior management.

Section 22.1 of the Criminal Code reads as follows:

22.1 In respect of an offence that requires the prosecution to prove negligence, an organization is a party to the offence if:

a)   acting within the scope of their authority

i)    one of its representatives is a party to the offence, or

ii)   two or more of its representatives engage in conduct, whether by act or omission, such that, if it had been the conduct of only one representative, that representative would have been a party to the offence; and

b)   the senior officer who is responsible for the aspect of the organization’s activities that is relevant to the offence departs — or the senior officers, collectively, depart — markedly from the standard of care that, in the circumstances, could reasonably be expected to prevent a representative of the organization from being a party to the offence.

Conclusion

It is clear from the foregoing that businesses, including their directors and officers, that contravene the Order, whether wilfully or through negligence, may find themselves facing serious legal consequences of a civil as well as penal or criminal nature. Add to that the reputational risk to any business that it is identified as having contravened the Order, regardless of whether or not its employees contracted COVID-19.

Accordingly, the decision of whether or not to continue workplace activities must be taken in a prudent and informed manner, by taking into account the intended public health objectives of the legislator and to be mindful, to the extent permitted under the Order, of ensuring that minimum operations are maintained, in the case of non-priority activities, to facilitate the resumption of its activities at the end of the pandemic.



[1] For a complete and updated list, see https://www.quebec.ca/en/health/health-issues/a-z/2019-coronavirus/essential-services-commercial-activities-covid19/.

[2] CQLR, c S-2.2.

[3] CQLR, c C-25.1.

[4] RSC 1985, c C-46.

[5] CQLR, c S.-2-1.

[6] Id.

[7] Sec 123(2).

[8] Sec 123(4).

[9] Sec 41.

[10] Sec 42.

[11] CQLR, c C-25.1.

[12] RLRQ, c. S.-2-1.

[13] Sec 2.

[14] Sec 51(5).

[15] Centre hospitalier de St. Mary and Iracani, [2007] CLP 395.

[16] Sec 236.

[17] Sec 237.

[18] Sec 239.

[19] Sec 241.

[20] Sec 119, para 1 of the Business Corporations Act, CQLR c S-31.1, “BCA”; art. 322 and 2138 C.c.Q., and sec 122 (1) b) of the Canada Business Corporations Act, RSC 1985, c C-44, “CBCA”.

[21] Peoples Department Stores Inc. (Trustee of) v. Wise, 2004 SCC 68.

[22] BCE inc. v. 1976 Debentureholders, 2008 SCC 69.

[23] Meyerco Enterprises Ltd. v. Kinmont Canada inc., 2016 QCCA 89.

[24] Sec 217.1.

[25] Sec 219-221 C.C.

[26] See: R. v. Detour Gold Corporation, 2017 ONCJ 954 (CanLII), R. v. Stave Lake Quarries Inc., 2016 BCPC 377, R. v. Metron, 2013 ONCA 541 and R. v. Fournier, 2018 QCCQ 1071.

[27] Sec 22.1 C.C.