The dreaded answer is: “it depends…”
Fortunately, the Ontario Court of Appeal in Barber v The Manufacturers Life Insurance Company (Manulife Financial) (“Barber v Manulife”) has clarified whether to file a claim for long term disability benefits in the Ontario Superior Court or to proceed in arbitration.
Firstly, one must determine whether the essential character of the dispute concerns LTD benefits. If so, does the claim’s essential character arise from the interpretation, application, administration or violation of the Collective Agreement? If the answer is yes, than it is the arbitrator, not the court, that has exclusive jurisdiction to decide.
But wait! How do you know whether the essential character arises from the interpretation, application, administration or violation of the Collective Agreement? Simply put, how do we determine whether the arbitrator has the jurisdiction to decide benefit entitlement claims such LTD claims?
The Ontario Court of Appeal has adopted the following four categories from Brown & Beatty which help answer this question:
- Where the collective agreement does not set out the benefit sought to be enforced, the claim is inarbitrable;
- Where the collective agreement stipulates that the employer is obliged to provide certain medical or sick-pay benefits, but does not incorporate the plan into the agreement or make specific reference to it, the claim is arbitrable;
- Where the collective agreement only obliges the employer to pay the premiums associated with the insurance plan, the claim is inarbitrable; and
- Where the insurance policy is incorporated into the collective agreement the claim is arbitrable.
In Barber v Manulife, Adrian Barber became disabled from her employment as a Port Hope police constable. She applied for LTD benefits under a group policy insurance; insured by Manulife. The collective agreement, which governed Ms. Barber’s employment, required the employer to offer disability insurance coverage to the Port Hope Police Association’s members. Ms. Barber appealed Manulife’s decision to terminate her benefits at the Superior Court of Justice. However, her claim was dismissed because the motions judge found that the collective agreement granted exclusive jurisdiction to the labour arbitration process. In other words, the Superior Court found it did not have jurisdiction over Ms. Barber’s matter.
The Ontario Court of Appeal agreed with the motions judge. The collective agreement established Ms. Barber’s rights to LTD benefits. In fact, the provisions within the collective agreement did more than merely oblige the employer to pay premiums for insurance: they covered the terms, the amount of the disability benefits and the definition of total disability. The Court of Appeal noted that the employer could have changed insurers as long as the benefits defined in the collective agreement continued.
An arbitrator may have jurisdiction in determining LTD entitlements when:
- The collective agreement does more than merely oblige the employer to pay insurance premiums;
- The provisions of the collective agreement covers the terms of the LTD benefits;
- The amount of the disability benefits is specified;
- “total disability” is defined in the collective agreement;
- The insurance policy is incorporated in the collective agreement.
The courts will have jurisdiction, even in a unionized setting, when the collective agreement does not set out the benefit or only obliges the employer to pay the premium. Jurisdiction and the time lines will be determined by this analysis, so examine the collective agreement and the jurisprudence carefully before deciding whether to grieve or sue.
 Barber v The Manufacturers Life Insurance Company (Manulife Financial), 2017 ONCA 164.
 Weber v Ontario Hydro,  2 SCR 929, at paras 11, 52 and 54.
 London Life Insurance Co. v Dubreuil Brothers Employees Assn. (2000), 49 OR (3d) 766, at para 10.
[This article is for informational purposes only and does not constitute legal advice, which cannot be given without consideration of your individual circumstances.]