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The Workplace Safety and Insurance Act (the “WSIA”) is the cornerstone of Ontario’s workers’ compensation system. The basic principle of the WSIA is the “historic compromise” between employees and employers: in exchange for the benefit of no-fault insurance benefits for workplace injuries and illnesses, s. 26(2) of the WSIA takes away employees’ rights to sue their employers in respect of the workplace injury or disease. A recent decision of the Divisional Court has confirmed the principle that arbitrators have no jurisdiction over claims for damages related to mental stress injuries caused by workplace stressors, like harassment or bullying, because such claims are compensable under the WSIA.

Until January 1, 2018, ss. 13(4)-(5) the WSIA barred claims for “mental stress injuries” – i.e., psychological injuries that are not preceded by a physical injury, but are caused by stressors in the workplace – subject to certain exceptions. However, since approximately 2014, decision makers generally considered the mental stress bar unconstitutional and refused to apply it (see e.g. Decision No. 2157/09, 2014 ONWSIAT 938). As a result, effective January 1, 2018, the provincial government amended s. 13 of the WSIA to expressly allow claims arising from mental stress injuries.

In Ontario Public Service Employees Union v. The Crown in Right of Ontario, 2019 ONSC 1077 (Div Ct), the Divisional Court upheld a decision of the Grievance Settlement Board (the “Board”) in which the Board held that it did not have jurisdiction to award a grievor damages as compensation for her mental stress injury arising from the employer’s alleged failure to stop workplace bullying. The Board held that the grievor’s claims for damages for mental stress directly arising from employment would be or would have been eligible for compensation under the WSIA such that s. 26(2) of the WSIA applied to bar the grievor’s claim for such damages.

Since the 2018 amendments to s. 13 of the WSIA, it has been our position that claims for damages arising from mental stress injuries caused by stressors in the workplace are barred by s. 26(2) of the WSIA. This recent decision of the Divisional Court confirms that understanding.

The full implications of the mental stress provisions in the WSIA are not yet totally clear.  For example, workplace harassment and/or bullying may sometimes be the basis for a claim for constructive dismissal, in which the employee could seek aggravated or general damages. It remains unclear whether, in light of s. 13 of the WSIA, s. 26(2) also operates to bar such claim for aggravated or general damages.  

If your business requires any advice with respect to WSIB matters, please contact us.

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