Human Rights Tribunal of Ontario: Terminating Employee Benefits at Age 65 June 18 2018
Background
A recent decision by the Human Rights Tribunal of Ontario may cause employers to reconsider how they handle certain employee benefits for workers aged 65 and older. Section 25 (2.1) of Ontario’s Human Rights Code prohibits age discrimination against an employee in terms of employee benefits. In 2005, the government of Ontario passed Bill 211 which significantly amended the Code in relation to section 25 (2.1). First, it ended the ability of employers to require their employees to retire at age 65. However, as a means of apparent compromise and to maintain flexibility, the province still allowed employers to provide age-differentiated benefit and pension plans to those employees who are aged 65 and older. This, the Tribunal found, amounts to a violation of the Charter of Rights and Freedoms.
Talos v Grand Erie District School Board
Steve Talos turned 65 in 2012. At that time, his employer, the Grand Erie District School Board, terminated his health and dental benefits based on his age. Talos then filed a complaint with the Tribunal alleging a violation of section 25 (2.1) of the Code and the Canadian Charter of Rights and Freedoms.
In its defense, the School Board stated that the Code allows for employers to cut off certain group benefits to workers age 65 and older. They also argued that benefits that are terminated for post-age 65 workers are subject to collective bargaining, and the removal of the ability to bargain on these benefits could result in harm to both the plan’s financial health and the School Board’s constitutional protected collective bargained rights.
The Tribunal rejected both arguments. The Tribunal held that the collective bargaining process would not be hindered by the requirement to provide benefits to post-age 65 workers. The Tribunal also did not find any evidence of significant cost increase for an employer to provide group health and life benefits to post-age 65 workers. Ultimately, the Tribunal held that the Code’s section 25 (2.1) must be impugned in order to avoid age discrimination against post-age 65 workers and in violation of the Charter. For more information on this case, please refer to the Tribunal’s interim decision: http://canlii.ca/t/hs4l0.
Implications for Employers
Many employers currently possess benefit plan documents that include similar provisions as the School Board’s. Therefore, the Talos decision has the possibility of having a significant impact on the way that employers provide benefits to post-65 workers and collectively bargain such.
It is important to note that this is an interim decision. This means that the Talos case is still waiting for a final decision which could be either consistent, contrary, or amend the interim decision. Right now, in the absence of a final decision, it would be beneficial for employers to review their plan documents for language that affects benefits for post-age 65 workers. In addition, employers that will be entering into collective bargaining in the next few months may want to highlight such language as potential issues to table until final guidance becomes available, or include a provision to reopen negotiations upon the Tribunal’s final decision.