Contracting Out of the WSIA “Contrary to Public Policy”, Court of Appeal Holds

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The Ontario Court of Appeal has recently determined that employers classified as non-covered under Part X of the Workplace Safety and Insurance Act (WSIA) may not contract out of the provisions providing for their workers’ right to sue them for workplace accidents.

The WSIA establishes a scheme that provides no-fault loss of earnings benefits to workers, and which completely displaces all common law rights of action that workers may have had against their employer, with one exception:  employers under Part X of the WSIA can elect not to contribute to the insurance fund and are thus not liable to pay benefits. Instead, Part X of the WSIA provides workers with certain rights to actions for damages against their employer.

In Fleming v. Massey, Mr. Fleming was the race director for a go-kart club, a workplace classified as non-covered by the WSIB. He was injured after crashing a go-kart into the hay bales lining a corner of the track. Mr. Fleming brought an action for damages against the following defendants:

  • Andrew Massey, who drove the go-kart that injured Mr. Fleming;
  • Lombardy Raceway Park, the track where the accident occurred;
  • Lombardy Karting, which co-organized the race event;
  • the National Capital Kart Club, which co-organized the race event and arranged for Mr. Fleming to act as a race director; and
  • the Lombardy Agricultural Society, which owns the property on which the track operated.

Mr. Fleming had previously signed a waiver releasing all of the Defendants in the action from liability for all damages associated with his participation in the event due to any cause, including negligence.

In hearing a motion for summary judgment in this case, the judge found that the race director:

  • was not an employee but rather a volunteer who received a stipend;
  • signed the waiver; and
  • knew generally what signing the waiver would mean, and that the wording of the waiver was broad enough to cover all eventualities.

Mr. Fleming appealed, arguing that he was an employee of the National Capital Kart Club, and that the waiver was void because it violated public policy.

The Ontario Court of Appeal found that the motion judge had erred in finding that the race director was not an employee, and the National Capital Kart Club admitted that the race director was a paid employee on the day of the accident.

The Court of Appeal went on to find that Mr. Fleming was not an insured worker under the WSIA, and the National Capital Kart Club did not apply for coverage under the WSIA. As a result, both the employer and the employee fell under Part X of the WSIA, which states, inter alia, that workers are allowed to sue their employers for workplace accidents.

Reasoning that to allow individuals to contract out of the provisions of Part X of the WSIA would be contrary to the public policy of ensuring that employees injured in workplace accidents receive compensation, the appellate court set aside the summary judgment and permitted the employee’s action to go to trial.

For employers that are regulated under Part X of the WSIA, this decision sends a clear message that waivers aimed at contracting out of the worker’s right to sue for negligence or otherwise in relation to a workplace accident may be considered null and void by Ontario courts.