House of Lords in UK Finds Pleural Plaques not Compensable

The United Kingdom’s highest court recently decided unanimously in the Rothwell decision that workers who have been exposed to asbestos in the course of their employment and have developed pleural plaques (a condition involving benign growths in the lining of the lungs caused by asbestos exposure) are not eligible to claim compensation in negligence.

Previously, on February 15, 2005, ten pleural plaques test cases at the trial level had been successful in arguing that the workers were entitled to compensation on the basis that the condition, considered in light of the anxiety caused and combined with the risks of developing an asbestos-related disease in the future, amounted to a complete cause of action.

The Court of Appeal subsequently overturned the decision on January 26, 2006, finding that the plaques themselves are harmless and do not constitute a cause of action. The Court of Appeal held that three unactionable “injuries” do not amount to an actionable injury when considered in the aggregate.

The House of Lords considered three issues in their judgment:

i) whether the existence of pleural plaques entitled the workers to bring an action in tort for damages against their employers who had negligently exposed them to asbestos;

ii) alternatively, if the condition of plaques on its own is insufficient, whether the presence of the plaques combined with the anxiety they caused and the risk of future disease would suffice to create a cause of action in tort for damages; and

iii) in relation to only one appellant, whether an individual suffering from a psychiatric illness caused by his anxiety about the possibility of developing an asbestos-related disease, can give rise to a cause of action in tort.

The House of Lords held that, although pleural plaques can be detected by X-ray, the plaques themselves are not actionable because they do not constitute real damage. Since the plaques do not cause any symptoms, nor do they cause any measurable harm in the subject’s health or capability, they cannot constitute damage, which is necessary to claim compensation in negligence.

At paragraph 47 of the decision, Lord Hope states,

an injury which is without any symptoms at all because it cannot be seen or felt and which will not lead to some other event that is harmful has no consequences that will attract an award of damages. Damages are given for injuries that cause harm, not for injuries that are harmless.

With regard to the “aggregation theory”, the Lords further held that the plaques, when combined with the risks of suffering further injury associated with asbestos exposure (but unrelated to the plaques) and anxiety about such risks, did not in the aggregate amount to sufficient injury to constitute a cause of action in negligence.

The Lords also rejected the claim of the appellant, who claimed that he had suffered from depression as a result of his deep-seated fear of developing asbestos-related disease, finding that he did not have a cause of action for his psychiatric illness because it was not reasonably foreseeable that exposure to asbestos would cause psychiatric injury.

Although this decision from the House of Lords makes it clear that British claimants will not be able to recover damages in negligence for their pleural plaques, a majority of the Lords noted that the workers could potentially seek compensation based on breach of contract of employment. As an aside, Lord Scott referred to an employer’s “contractual duty of care” when exposing workers to asbestos in the workplace, including the duty to provide a safe workplace environment. Because breach of contract does not require claimants to demonstrate actual damage, it remains to be seen whether future claimants will be successful by framing their claims under contract law. The extent to which this decision will impact upon Canadian employers also remains to be seen.

La Cour suprême du Canada explique le devoir d’accommodement

Dans sa décision récente, Hydro-Québec c. Syndicat des employées de techniques professionnelles et de bureaux d’Hydro-Québec, section locale 2000 (SCFP-FTQ), la Cour suprême du Canada a expliqué l’étendue du devoir d’accommodement d’un employeur lorsqu’un employé est congédié pour des absences liées à un handicap.

L’employée a travaillé chez Hydro-Québec pendant 24 ans avant son congédiement. Entre 1994 et 2001, malgré les mesures d’accommodement offertes par l’employeur, elle a été absente pendant 960 jours à cause d’une variété d’handicaps physiques et psychologiques. Après avoir obtenu l’expertise de la part de trois psychiatres, l’employeur a conclu que l’employée était incapable de travailler sans s’absenter. L’employée a été congédié.

Dans une décision unanime, la Cour suprême du Canada a conclu que le critère de contrainte excessive n’exige pas qu’un employeur établisse qu’il est impossible d’accommoder l’employée. La question que doit poser les tribunaux sur les droits de la personne est à savoir s’il est impossible pour l’employeur d’accommoder l’employée sans subir une contrainte excessive. Au paragraph 17 de sa décision, la Cour énonce le principe suivant:

« […] en cas d’absentéisme chronique, si l’employeur démontre que, malgré les accommodements, l’employé ne peut reprendre son travail dans un avenir raisonnablement prévisible, il aura satisfait à son fardeau de preuve et établi l’existence d’une contrainte excessive. »

La Cour suprême a finalement énoncé que le devoir d’accommodement d’un employeur n’est pas éternel, et a confirmé que l’objet du devoir d’accommodement est d’assurer qu’un employé qui en est capable puisse travailler :

« En pratique, ceci signifie que l’employeur doit offrir des mesures d’accommodement qui, tout en n’imposant pas à ce dernier de contrainte excessive, permettront à l’employé concerné de fournir sa prestation de travail. L’obligation d’accommodement a pour objet d’empêcher que des personnes par ailleurs aptes ne soient injustement exclues, alors que les conditions de travail pourraient être adaptées sans créer de contrainte excessive. »

La décision est claire et précise – dans des cas d’absentéisme chronique lié à un handicap, les employeurs doivent chercher des solutions d’accommodement pour aider l’employé a réintégré le travail. Ces mesures doivent être adaptées aux besoins de l’employé. Les tribunaux sur les droits de la personne et les cours de justice continueront a exigé une preuve de tels efforts. Par contre, lorsque l’employé ne peut reprendre son travail dans un avenir raisonnablement prévisible, malgré les mesures d’accommodement, l’employeur pourra établir la contrainte excessive.

Amendments to Alberta’s Labour Relations Code

On June 9, 2008, Bill 26 received Royal Assent in Alberta. The bill, which will come into effect on proclamation, introduces three main changes to the Labour Relations Code:

1. Ambulance attendants are prohibited from striking and their employers are prohibited from locking them out. The parties must instead arbitrate their disputes.

2. Building Trade Unions are prohibited from contributing to Market Enhancement Recovery Funds (MERFs). MERFs are used by union contractors to subsidize employees’ pay, which reduces the employer’s payroll costs to the extent of the MERF subsidy and makes the union contractor’s bid more competitive than bids by non-union contractors. Current MERF funds are to be distributed by the union as set out in the trust agreement or collective agreement, or as directed by the regulations.

3. Bill 26 introduces changes to the certification process in the construction sector. New hires who have been employed for less than 30 days and employees who quit between the time of the application for certification and the secret ballot vote will no longer be eligible to participate in the certification vote. Additionally, employees will be entitled to revoke the certification within 90 days. These changes are intended to prevent “salting”, the union practice of sending employees to work at non-union construction sites in order to sway certification votes.

Unilateral Changes to the Employment Contract: Ontario Court of Appeal Changes the Legal Test

In the recent decision of Wronko v. Western Inventory Service Ltd., the Ontario Court of Appeal muddied the waters with respect to an employer’s obligations when seeking to unilaterally modify an existing employment contract.

Wronko had been employed by Western Inventory for seventeen years. When a new company President was appointed, the President asked Wronko to sign an amendment to his employment contract that reduced his severance pay entitlement from two years to thirty weeks. When Wronko refused, the President gave him formal notice that, after two years, the amendment would be unilaterally imposed. Wronko continued to object to the change. After two years, the President indicated that the amendment had taken effect and that, if Wronko refused to sign the amended agreement, he would not have a job. Understanding his employment to be terminated, Wronko did not report for work and sued his employer for wrongful dismissal.

The trial judge found that an employer is allowed to unilaterally change a fundamental term of an employment contract as long as the employee is given reasonable notice of the change. The judge concluded that Wronko had terminated the employment relationship by refusing to continue to work under the new terms, and dismissed his claim.

The Court of Appeal overturned the trial judge’s decision. In its reasons, the Court explained that three options are available to an employee when his or her employer unilaterally amends a fundamental term of the employment contract:

1. The employee may accept the change, and his or her employment will continue under the new terms;

2. The employee may reject the change, take the position that he or she has been constructively dismissed, and sue for damages; or

3. The employee may demonstrate that he or she is rejecting the change but continue to work. In that case, the employer may respond in one of two ways: the employer may terminate the employee with proper notice and offer re-employment on the altered terms, or the employer may allow the employee to continue to work, in which case the employee is entitled to insist on the terms of the original contract govern.

The Court of Appeal held that Wronko’s situation fell into the third category and, since the employer did not terminate Wronko and offer him re-employment on the new terms, it must be deemed to have accepted that the original contract would remain in effect. Since the Court considered the President’s final communication to Wronko to be a termination, it awarded Wronko two years pay in lieu of notice, in accordance with the terms of his original contract.

Prior to this decision, employers could make unilateral changes by providing advanced reasonable notice of the change, and at the end of the notice period, the change was effective. The Court of Appeal now requires an employer to terminate the employee at the end of the notice period, and offer re-employment under the new terms for the change to be enforceable. We are of the view that the Court of Appeal’s decision is incorrect and creates an overly legalistic approach to a simple issue. Unfortunately, the Supreme Court of Canada has refused to intervene and has denied the employer’s leave to appeal. Time will tell whether this decision will become a precedent requiring the intervention of the Supreme Court to rectify.

Supreme Court Clarifies Employers’ Duty to Accommodate

In the recent decision of Hydro-Québec v. Syndicat des employées de techniques professionnelles et de bureaux d’Hydro-Québec, section locale 2000 (SCFP-FTQ), the Supreme Court clarified the scope of an employer’s duty to accommodate when terminating an employee for disability-related absenteeism.

The employee had worked for Hydro-Quebec for 24 years. Between 1994 and 2001, despite the employer’s attempts to accommodate her, she missed a total of 960 days of work due to a variety of physical and mental disabilities. After obtaining expert reports from three psychiatrists, the employer concluded that the employee was unable to work on a regular and reliable basis and therefore terminated her for excessive innocent absenteeism.

The employee grieved her termination. The arbitrator dismissed the grievance on the basis that the medical information confirmed that the employee would likely continue to miss work in the foreseeable future. Furthermore, the arbitrator concluded that the accommodation measures suggested by the union would constitute undue hardship for the employer. The Quebec Superior Court dismissed the union’s motion for judicial review of the arbitrator’s decision.

The Quebec Court of Appeal allowed the union’s appeal, setting aside the arbitrator’s decision on the basis that it was not “impossible” for the employer to accommodate the employee and that the duty to accommodate must be assessed at the time of the decision to terminate the employee.

The Supreme Court of Canada overturned the decision of the Court of Appeal. In a unanimous decision, the Court discussed the interpretation and application of the Meiorin test, which determines whether an employer has met its duty of reasonable accommodation. The Supreme Court found that the Court of Appeal had erred in concluding that the third part of the Meiorin test required evidence that it was impossible for the employer to accommodate the employee. Rather, the issue is whether it is impossible for the employer to accommodate the employee to the point of undue hardship. At paragraph 17 of its decision, the Supreme Court states:

[…] in a case involving chronic innocent absenteeism, if the employer shows that, despite measures taken to accommodate the employee, the employee will remain unable to resume his or her work in the reasonably foreseeable future, the employer will have discharged its burden of proof and established undue hardship.

The Supreme Court found that the Court of Appeal had erred by assessing the duty to accommodate at the time when the employer made the decision to dismiss the employee. Rather, the duty to accommodate must be assessed globally, and take into account the entire history of absenteeism and accommodation.

Based in part on the employer’s past attempts to accommodate the employee, and her continued absenteeism, the Supreme Court found that the employer had reached undue hardship, and upheld the termination.

The Supreme Court has finally clarified that the employer’s duty to accommodate is not endless, and confirms that the goal of the duty to accommodate is to ensure that the employee who is able to work can do so:

“In practice, this means that the employer must accommodate the employee in a way that, while not causing the employer undue hardship, will ensure that the employee can work. The purpose of the duty to accommodate is to ensure that persons who are otherwise fit to work are not unfairly excluded where working conditions can be adjusted without undue hardship.”

The decision makes it clear that, in cases of disability-related absences, employers are required to find accommodative measures which will assist the employee in returning to work. Accommodation measures are to be tailored to the specific needs of the employee. Human rights tribunals, arbitrators and courts will continue to expect evidence of these efforts. However, employers can now rest assured that, where there is no foreseeable improvement to the attendance record notwithstanding the accommodation measures implemented, there is a point of undue hardship.

Nunavut Increases Minimum Wage

On September 5, 2008, Nunavut’s Bill 33, An Act to Amend the Labour Standards Act, came into effect, resulting in an increase in the minimum wage from $8.50 per hour to $10.00 per hour. The rate will apply to all workers, regardless of age. Intended to reflect the territory’s high cost of living, the increase makes it the highest minimum wage in Canada.