RavenLaw was pleased to be invited to consult on this year’s Lancaster House Human Rights and Labour Law conference in Ottawa and to present on multiple panels. The annual two-day conference addresses a wide range of topical and emerging issues in the area of labour and human rights law.

Andrew Astritis served on the conference’s Advisory Committee this year, helping to plan the event. Wassim Garzouzi presented on October 10, 2019 as part of the panel “Taking Stock, Looking Ahead: Major caselaw and legislative update.” Morgan Rowepresented on October 11, 2019, discussing the difficult questions that arise when workers experience illnesses and disabilities due to workplace stress, bullying, and interpersonal conflicts.

As an employee, once you have applied for Long Term Disability (LTD) benefits, you have certain responsibilities you must fulfil to ensure that your claim for benefits is accepted or to ensure that you continue receiving benefits. The specifics of these responsibilities will be listed in the benefits policy and will usually include the following:

• Making reasonable efforts to recover

As part of your responsibilities, the insurance company expects that you will make efforts to recover from your illness or injury. This includes being under the care of a physician, specialist, or other treatment providers and also requires you to participate in any reasonable and customary treatment or rehabilitative program.

If you and your treating physician(s) believe that you cannot take part in a program recommended by the insurance company, you will need to provide medical evidence as to why you cannot take part. This should state that your participation in a program would hinder your recovery efforts and explain why in detail.

• Making reasonable efforts to attempt a return to work 

The insurance company will also expect you to make reasonable efforts to attempt to return to work either in your own occupation or in an alternate job.

Usually, a return to work will start gradually, taking your physicians’ advice regarding hours, schedule, restrictions, and limitations. The return to work may also consist of modified duties for a certain period, depending on your physician’s advice.

• Applying for other benefits 

Your policy will most likely set out your responsibility to apply for other benefits that you may qualify for, such as Canada Pension Plan (CPP) Disability benefits. Some policies will even ask that you appeal any decision denying those benefits.

Insurers usually set up their insurance policies, so they become the “payors of last resort”. This means that other sources of income, such as CPP Disability benefits, are deducted or offset from your LTD benefit. You will also be required to let your insurance company know if you apply for other benefits and they are approved. Those new benefits may reduce the amount you receive from the insurance company.

For more information on this topic, please refer to our article on long term disability offsets.

• Reporting other income 

The insurance company will expect you to report any income you are receiving from sources other than your LTD claim.

It is important for you to advise your caseworker about any other sources of income from other employment or benefits. If you do not advise your insurance company, you could be responsible for repaying some or all of the LTD benefits you have already received.

Check your specific policy to see what qualifies as reportable income, but generally, it consists of the following:

• CPP Disability Benefits;
• WSIB payments;
• Notice or Severance payment from your employer if you are terminated; and
• Employment Income not previously approved by the insurance company.
• Cooperating with the Insurance Company regarding your health 

 It is important to cooperate with your insurance company and provide them with updated medical documents and medical information when they ask for them. This might include surgery dates, new diagnosis, new findings, test results, and new medications.

Unlike the employment context, where there is no obligation to provide all medical reports or diagnoses to your employer when on sick leave or when making an accommodation request, dealing with an insurance company is different. You are required to provide them with medical reports and diagnosis to show that you meet the definition of disability as set out in the LTD policy.

It is also valuable to inform the insurance company of your progress or setbacks regarding your illness/injury.

We are here to help navigate the Long Term Disability claim process. Consult one of our experienced Disability lawyers at Raven, Cameron, Ballantyne and Yazbeck LLP if you are considering making a claim for disability benefits or if your disability claim for benefits has been denied. 

[This article is for informational purposes only and does not constitute legal advice, which cannot be given without consideration of your individual circumstances.]

The Federal Court of Appeal recently overturned a decision of the Federal Public Sector Labour Relations and Employment Board (“Board”), which had denied any damages to an employee who was sexually harassed and sexually assaulted in her workplace. The Court found the Board’s decision unreasonable, and criticized the Board Member’s reasons for reflecting improper stereotypes about sexual assault.

Background

The Applicant (pursuing her case under the pseudonym Jane Doe) was subject to months of verbal sexual harassment by a co-worker, culminating in an incident that the employer acknowledged was a sexual assault. She filed a grievance against her employer for failing to provide a harassment-free workplace. The employer acknowledged that the applicant had experienced sexual harassment and sexual assault, but argued that it was not liable for the co-worker’s conduct, or that the Board had no jurisdiction to award damages.

In its decision regarding the Applicant’s grievance, the Board accepted that the Applicant had experienced sexual harassment, contrary to the Canadian Human Rights Act. The Board rejected the employer’s argument that it did not have jurisdiction to award damages to the Applicant. However, the Board found that the Applicant was not entitled to any damages. Among the reasons given, the Board stated:

• The “incident” the Applicant experienced was “a vulgar prank”;
• There were steps that a “confident employee” such as the Applicant could have taken to deal with the harassment, if the work environment had truly been as difficult to cope with as she described;
• It was “unlikely, to say the least” that the “vulgar prank” caused the “extreme emotional impact” she described.

Judgment of the Federal Court of Appeal

In its judgment issued on October 10, 2018, the Federal Court of Appeal overturned the Board’s decision. The Court held that the Board had improperly denied damages to the Applicant because the sexual assault was not solely responsible for the Applicant’s psychological injury. The Court noted that it was not in dispute that the sexual assault had caused the Applicant to experience harm, and it was not necessary for it to be the sole cause of that harm. The Court conclusively held that, “once pain and suffering caused by a discriminatory practice are established, damages should follow”.

In view of the Court’s finding that the Board’s decision was unreasonable, the Court found it unnecessary to decide whether the Board Member’s decision also gave rise to a reasonable apprehension of bias. Nonetheless, the Court chose to comment on two problematic aspects of the Board Member’s reasons.

First, the Court noted that the Board never referred to the culminating incident as a sexual assault, instead calling it a “vulgar prank”. The Court noted that there may be a number of reasons for a decision-maker to choose to use certain language; however, “it is necessary to take care not to inappropriately downplay or diminish the seriousness of unacceptable conduct. The sexual assault at issue in this case could not be reasonably characterized as a “prank”.”

Second, the Court commented on the Board Member’s apparent reliance on stereotypes about how someone would react to sexual harassment or sexual assault. Noting the Supreme Court’s caution against presuming how people who experience sexual assault will behave, the Court stated:

In my view, characterizing an employee as a “confident employee who handled the work easily and had aspirations of joining the management team” (reasons, paragraph 142) similarly does not permit an inference to be made that such an employee would react in a particular way to an escalating number of sexually explicit and violent comments made by a co-worker. One employee might complain immediately to management while another might “go along to get along”. It was an error for the Board to conclude that the applicant exaggerated how difficult it was to cope with her work environment on the basis that the Board characterized the applicant to be a “confident” employee.

Equally, because there is no one typical response by victims to a sexual assault, there was no basis for the Board to infer mainly from the applicant’s responses that the co-worker’s conduct could not have caused the harm described by the applicant. This is particularly troublesome when the Board’s own concept of logic or common sense was substituted for its assessment of the actual evidence before it.

The Applicant was represented before the Federal Court of Appeal by Andrew Raven and Amanda Montague-Reinholdt of RavenLaw.

What Are Long Term Disability Benefits Offsets?

What Are Long Term Disability Income Offsets?

In the Long Term Disability Benefit context, offsets are other sources of employment or employment-like income. Offsets will be deducted from the amount of Long Term Disability benefit allowed to a claimant by an insurance company.

How Does LTD Coverage Work?

Insurers typically design their insurance Long Term Disability coverage contracts so they become ‘payers of last resort.’ This means that other sources of employment income are deducted, or offset from what the LTD insurer would otherwise pay in Long Term Disability benefits.

If you’re a unionized public servant, your LTD coverage is provided by SunLife and if you’re a public service executive, the insurer is Industrial Alliance. For public servants, SunLife and Industrial Alliance are the only alternatives. If you work in the private sector and your employer is providing LTD coverage, the offsets will likely be similar to those in the public service plan. If you’re insuring yourself, you can always negotiate fewer offsets, but they will cost you more money in premiums. If you don’t want any offset, the better alternative might be Critical Illness Insurance, which gets you a specific fixed payment for a specific injury or illness.

Here are some examples of how LTD coverage works:

• Suppose you have LTD benefits which pay you $5,000 per month and you become eligible for a pension or a medical retirement which pays $3,000 per month. The insurer will see this new source of income and reduce the payment of $5000 to $2000 per month. The employee will still have a monthly income of $5,000, but it will consist of two cheques totalling $5,000, of which the insurer will only pay the difference between the pension and the original LTD benefit.
• Suppose you are unable to work and you’re not able to provide the same level of financial support to your family. It’s likely that you think you’re going to get LTD benefits plus Canada Pension Plan Disability (CPPD) and your kids are going to be looked after, at least to some extent. If you are getting $1,000 a month from LTD, but your CPPD gives you $800 a month and there’s a $200 monthly child benefit for each of your three kids, that’s a total of $1,400 a month from sources outside your LTD payment. All that money, including the $200 for the children, are classified as offsets and will reduce your LTD to zero.
• If you are in a car accident and you are paid damages for injuries, that would not be an offset. If you are paid damages for loss of income that would be an offset.
• Savings or registered retirement savings plans (RRSPs), are not considered offsets and cannot be deducted from Long Term Disability benefits.

Can the Insurer Force You to Apply for Long Term Disability Offsets?

The answer will depend upon the language of the particular insurance policy. Frequently, the answer will be yes, particularly for such benefits as Canada Pension Plan Disability Benefits.  If the insured person fails to apply for the CPPD benefits, the LTD insurer will assume they have and will deduct the value of that benefit from the LTD, even if they do not apply.  

In the case of CPPD, that value is approximately $14,000 annually. There may even be an obligation to appeal from a negative ruling concerning CPPD.

For benefits such as pensions, if a person is in receipt of a pension, that amount will likely be considered an offset and deducted.  

If a person is not getting a pension, whether they must apply for a pension will usually depend on the language of the insurance policy.

Severance Pay

Severance is usually considered an offset and the insurance company will deduct 100% of it from LTD.  So, there can be substantial benefits to remaining an employee while you’re on LTD and it may not be necessary to terminate your employment. This is important because many people who lose their job and go on LTD prior to getting a severance package, think they will get to keep both. If maintaining your employment status is not possible, there are strategies that might be available that allow you to keep some or all of the severance package. 

The takeaway here is that you should not assume you are going to have multiple sources of income if you are on LTD because the insurance company will want most of it. The insurance companies say that without offsets, everyone’s premiums would be higher. This is true, but they will not give people the option of paying higher premiums in exchange for greater protection. The complexities of Long Term Disability are not something most people even think about. They get a job, they take the benefits they are offered and forget about it . . . until they are faced with dealing with long-term sickness or injury.

Is Long Term Disability Insurance Mandatory?

No, it is not a legal requirement but you would be unwise not to have it.

The biggest financial asset for most people is not their house but their ability to work. Simply put, if you and your family need income in order to live, you need Long Term Disability insurance, which will give you 50-70 percent of your former income. Without LTD, you are left with the Ontario Disability Support Programme at around $10,000-$12,000 a year and Canada Pension Place Disability which is around $14,000 a year. If you were making a reasonable income prior to your injury, going down to that level is not pleasant. 

Have questions? Reach out to our team of experienced Long Term Disability lawyers to learn more about LTD coverage.

The firm gratefully acknowledges the contribution to this post by articling student Megan Fultz.

The Ontario government made good on its promise to repeal the labour and employment reforms enacted by the Liberals, when it introduced Bill 47, the Making Ontario Open for Business Act, on October 23, 2018. Bill 47 reverses most changes from the Liberal’s Fair Workplaces, Better Jobs Act, also known as Bill 148, enacted last year. Bill 47 will likely pass before the legislature breaks on December 13, 2018.  If Bill 47 passes, it will take effect on January 1, 2019.

Bill 148 represented a significant, if imperfect, effort to advance workers’ rights. Bill 47 unquestionably tips the scales back in the other direction, favouring the protection and rights of employers. It also reduces the amount of oversight in the enforcement of employment standards and the consequences for breaching the Ontario Labour Relations Act.

Overview of major changes in Bill 47

The changes in Bill 47 are numerous and they universally favour employers at the expense of workers. The major changes include: 

Minimum Wage Frozen – Under Bill 148, minimum wage was set to increase to $15.00 per hour in January, 2019. Bill 47 will freeze it at $14.00, with no increase until October 1, 2020, at which time it will only increase at the rate of inflation.

Reduced Fines for Employers – Bill 47 reverses the increased fines for offences under the Labour Relations Act enacted in Bill 148. Fines are going down to $2,000 for individuals, reduced from $5,000, and to $25,000 for organizations, down from $100,000.

No More Paid Emergency Leave – Under Bill 148, all Ontario workers were entitled to two paid and eight unpaid days of Personal Emergency Leave. These ten days of leave allowed workers to take time for either their own urgent needs, or to care for the urgent needs of their loved ones. Bill 47 eliminates Personal Emergency Leave and replaces it with eight days, all unpaid, under three specific categories: sick leave (three days), family responsibility leave (three days), and bereavement leave (two days).

No Equal Pay for Equal Work – Bill 148 introduced equal pay for equal work, meaning employees performing the same work must be paid the same, regardless of whether they were full-time, part-time, casual, and temporary workers. Bill 47 will repeal this protection and allow for some workers to be paid less solely on the basis of their employment status. Bill 47 also removes certain protections for workers who believe they are experiencing wage discrimination on the basis of sex. Under Bill 148, workers could request a review of their pay, requiring employers to either provide a written explanation of how the worker’s pay is compliant with wage discrimination laws, or adjust their pay. These requirements and protections will be repealed under Bill 47.

Burden on Workers to Prove Employee Status – Bill 148 shifted the burden to the employer when there is a dispute about whether a worker is an employee or an independent contractor: employers had to prove that the worker was not an employee. Bill 47 shifts the burden back to the employee to prove that they are an employee and not an independent contractor.

Remedial Certification No Longer Mandatory – Under Bill 148, if a union was prevented from obtaining enough votes to certify because of an employer’s influence and interference with its employees, the Ontario Labour Relations Board was required to certify the union as a remedy to that interference. Under Bill 47, remedial certification is no longer required; instead, the Board has to consider whether to certify the union or merely order a secret ballot vote.

This list represents just some of the regressive changes made by Bill 47 that will impact Ontario workers. Bill 47 also introduces changes that will affect workers’ scheduling and “on call” rights, public holiday pay, card check certification, and return-to-work rights, among others.

Dark days for workers’ rights

Bill 47 represents a significant step backwards from the progress made by Bill 148. The Ontario government has framed these changes as aimed at improving the economy and helping businesses, but the scope of the changes reveals the true aim to be reducing or removing protections for workers. Employers will have far fewer obligations to their employees, and will even face reduced penalties if they disregard the modest obligations they still have. Bill 47 looks less like making Ontario “open for business”, and more like “open season” on Ontario’s work force.

[This article is for informational purposes only and does not constitute legal advice, which cannot be given without consideration of your individual circumstances.]

On February 13, 2019, Morgan Rowe will present a workshop on human rights law, worker’s rights and how these two sets of rights can be used to help individuals with disabilities challenge barriers in employment. The workshop will be hosted by OPIRG Carleton and the Carleton Disability Awareness Centre.

For more information about the workshop, please visit the event page.

Ravenlaw is proud to sponsor After the Storm a relief and recovery concert organized by CUPE 503 for those affected by the tornadoes that impacted the Ottawa/Gatineau area. The Tornado Relief Concert is free for all and will raise money for the victims of the September tornado and the long-term recovery effort required. The concert will be held on Saturday, November 10th at the TD Place arena. For more information on how to attend click here.

On February 6, 2019, David Yazbeck spoke on a panel on advocacy for sexual and reproductive health and rights. The panel was organized by Action Canada for Sexual Health and Rights and Oxfam Canada. Panellists touched on aspects of advocacy from the grassroots to international efforts. Remarks were also given by the Parliamentary Secretary to the Minister of International Development, Kamal Khera, highlighting the federal government’s efforts in promoting sexual and reproductive health and rights, particularly its support for feminist and women’s rights organizations.

David is acting as pro bono counsel for Action Canada for Sexual Health and Rights, which has intervened in an application for judicial review before the Federal Court. This application challenges the federal government’s requirement that organizations receiving summer jobs funding attest to their programs being consistent with the Canadian Charter of Rights and Freedoms. Action Canada has intervened to support the government’s position that this requirement is legitimate and necessary.

On October 31, 2018, Julia Williams participated in a panel discussion at the University of Ottawa on “Interview Landmines.” The panel was a Q&A with lawyers offering insight into how to deal with difficult questions about race, gender, sexual orientation, family plans, and more during recruitment processes.  Julia would like to thank the University of Ottawa Association of Women and the Law (UOAWL), one of the largest equity-seeking groups at the University of Ottawa, for inviting her to participate in this event.

Disability Benefits Taxable Implications

With the month of April just around the corner, you may be getting ready to prepare and file your taxes for 2020. Many people ask us whether their Long Term Disability premiums are a taxable benefit in Canada. While there is no easy yes or no answer here, we have provided the important information you may need below. 

Do You Pay Income Tax on Disability Benefits in Canada? 

If you have been in receipt of disability benefits, you will need to understand the tax implications that apply to the disability benefit you have received. Different tax rules will apply depending on the type of benefit received, who paid the premiums for the benefit, and the total amount of income received by an individual in a given tax year.  

Below, you will find summary information about the tax implications when you have been in receipt of disability benefits. This information provides a general review and the implications for your specific situation will differ depending on your specific circumstances. For answers about your specific circumstances, you should consult with a lawyer specialized in this area of practice or a tax professional. 

EMPLOYMENT INSURANCE (EI) SICKNESS BENEFITS

The Employment Insurance program offers temporary financial assistance (up to a maximum of 15 weeks) to people unable to work because of sickness, injury or quarantine. These benefits are usually the first benefits received by an employee after they have exhausted their sick leave and they are unable to return to work because of continued injury or illness.

Employment Insurance benefits are taxable, which means that federal and provincial taxes will have been deducted from your EI payments prior to receipt. Depending on your total income for 2020, you may be required to repay a portion of EI benefits received when you file your taxes.   

If you were in receipt of EI benefits, you will receive a T4E, “Statement of Employment Insurance and Other Benefits” slip, which will indicate if you are required to repay a portion of the EI received. The T4E is issued by Service Canada. 

SHORT-TERM DISABILITY (STD) OR LONG-TERM DISABILITY (LTD) BENEFITS

Short-Term Disability (STD) benefits and/or Long-Term Disability (LTD) benefits provide some income protection when a person is unable to work due to an illness or injury. You may access STD and LTD coverage through purchasing personal insurance coverage and/or through accessing group insurance coverage. Group insurance coverage is generally accessed via an employee benefit plan. 

For more information on when and how to file a claim for Short-Term or Long-Term Disability benefits, please refer to our disability benefits page.

Whether tax is payable will depend on who has paid the premiums for the STD and/or LTD benefits. If any portion of the premiums for STD and/or LTD disability benefits were paid by your employer, the benefits are taxable. If all the premiums for your Short-Term or Long-Term Disability insurance were paid by you, the benefits are generally not taxed. 

Given the importance of the taxability of these benefits, employers, unions, and employees should all be concerned about who pays the premiums on these benefit plans.

If you are unsure as to who is paying the premiums for your disability plan, you can contact your insurance provider and they will notify you as to whether your benefits are taxable or not.

CANADA PENSION PLAN DISABILITY (CPPD) BENEFITS/ QUÉBEC PENSION PLAN (QPP) DISABILITY PENSION

The CPP disability benefit and QPP disability benefit are available to assist people who are unable to work in any capacity due to severe and prolonged disability. If you have qualified, and are receiving Canada Pension Plan Disability Benefits or Quebec Pension Plan Disability Pension, you should be aware that these benefits are taxable income. All the amounts received from CPP or QPP must be reported in your tax return. 

You would receive a T4A(P) “Statement of Canada Pension Plan Benefits” tax slip at the beginning of the year if you received benefits from the CPP or the QPP. The T4A(P) will indicate the amount of benefits you received in the previous year. If you received QPP benefits, you would also receive a RL-2 “Relevé 2: Retirement and annuity income” slip. 

DISABILITY TAX CREDIT (DTC)

The CRA offers several tax credits to offset a disabled individual’s tax liability. A common tax credit accessed by people receiving CPP Disability Benefits is the Disability Tax Credit (DTC). This is a non-refundable tax credit that is available to persons who are experiencing severe and prolonged disability. 

The DTC tax credit assists to reduce the amount of income tax payable for persons with disabilities. Acknowledging that there are unavoidable additional expenses for persons with disabilities helps to provide greater tax equity. 

Accessing this tax credit requires a separate application, and not all persons in receipt of disability benefits will qualify. To apply, a specific form (Form T2201) must be completed by a medical practitioner and submitted to the CRA. The CRA then determines eligibility based on the information provided by the medical practitioner. 

A notice of determination will be provided to the applicant and will indicate which year(s) the applicant is eligible to claim the DTC. If the notice indicates that an applicant does not qualify, it will explain why. The notice may also include information about other programs that are available to individuals who qualify for the DTC. 

If a person would have been eligible for the DTC in prior years, but had not applied when they filed those taxes, they can seek a reassessment of the prior tax returns through the CRA.  

IMPORTANT LONG TERM DISABILITY TAX FORMS

CANADA PENSION PLAN DISABILITY (CPPD) BENEFITS/ QUÉBEC PENSION PLAN (QPP) DISABILITY PENSION

• T4A(P) Statement of Canada Pension Plan Benefits
• RL-2 Relevé 2: Retirement and Annuity Income

DISABILITY TAX CREDIT (DTC)

• Form T2201

HELP FOR PERSONS WITH LOW INCOME 

If your income is below qualifying thresholds, you may be able to access free assistance to complete your tax returns through a community organization. More information about free tax clinics to assist Canadians can be found by following this link. 

Consult one of our experienced Long-Term Disability lawyers at Raven, Cameron, Ballantyne and Yazbeck LLP if you have any questions.