By Derek Knoechel and Lorene Novakowski
Canadian provinces have workers’ compensation legislation that provides a no-fault system of compensation for injuries suffered on the job. The system covers lost wages, medical aid, and rehabilitation for the injured worker and generally removes the injured worker’s ability to sue the employer. The workers’ compensation system is funded by employer premiums that are set and determined primarily by the employer’s industry and by the individual employer’s experience in terms of accidents and claims.
In recent years, workers have claimed workers’ compensation benefits for workplace stress. The various provincial boards have been reluctant to approve stress claims except in limited circumstances. But maybe not for long. In a recent decision, the British Columbia Court of Appeal broadened the approach to mental stress claims.
Peter Plesner was working at a thermal generating station when a natural gas pipeline on the worksite ruptured, causing a stream of natural gas to rise 30 to 40 feet in the air. An evacuation alert was sounded, and Mr. Plesner made his way to the designated muster station. Once there, Mr. Plesner was told that there was a chance that some hydrogen containers would explode and the workers should stay put. It took 67 minutes to contain the gas escape after which Mr. Plesner remained at work, voluntarily staying overtime.
Mr. Plesner didn’t suffer physical injuries as he was about 40 or 50 feet away when the rupture occurred. But he was eventually diagnosed with post-traumatic stress disorder. He applied for workers’ compensation benefits, claiming that the condition prevented him from returning to work.
Under British Columbia law and policy, Mr. Plesner was entitled to compensation for mental stress only if it was related to a compensable physical injury or:
- the mental stress was an “acute reaction to a sudden and unexpected traumatic event” arising out of and in the course of his employment;
- the condition was diagnosed by a physician or a psychologist and described in the DSM-IV Diagnostic and Statistical Manual of Mental Disorders; and
- the condition was not caused by an employment decision made by his employer (e.g. change of work duties and conditions or termination of employment).
As expected, Mr. Plesner’s claim was denied — the pipeline rupture was not a traumatic event.
Mr. Plesner appealed to the British Columbia Court of Appeal, claiming that the law and policy breached the equality provisions of the Canadian Charter of Rights and Freedoms. The Charter is part of the Canadian constitution, and the equality provisions say that every individual has the right to equal protection without discrimination based on, among other things, mental or physical disability.
The Court of Appeal agreed with Mr. Plesner and struck down B.C.’s description of a traumatic event. The court said that the requirement that there must be a specific traumatic event, rather than a case-specific assessment of whether the individual’s mental injury was genuinely work-related, ignored the particular needs of workers suffering from mental stress injuries. The court noted that access to compensation and benefits for workers suffering from mental stress was significantly restricted in comparison with workers suffering physical injuries and that the restrictions were not justified.
The decision will undoubtedly have implications across Canada, as many other Canadian provinces have restrictions on mental stress claims similar to those that were struck down in B.C. As more stress claims are allowed, employers’ premiums will increase.
But what may be more concerning is the court’s comment that government’s choice to deny compensation for “chronic stress” claims might also be susceptible to a Charter challenge. These observations create greater cause for concern among Canadian employers, as employees would not have to point to one particular traumatic event. Of course, this too would have significant cost implications for employers.
Stressed yet?