Skip to content

Brought to you by

Dentons logo

Canadian Employment & Labour Law

Making the law work for your workplace.

open menu close menu

Canadian Employment & Labour Law

  • Home
  • About Us
  • Topics
    • Topics
    • Labour
    • Workplace investigations

Court of Appeal for Ontario clarifies that labour arbitrators have jurisdiction over long-term disability claims by unionized employees

By Allison Buchanan and Matthew Curtis
January 19, 2021
  • Labour
Share on Facebook Share on Twitter Share via email Share on LinkedIn

The Court of Appeal for Ontario recently considered whether labour arbitrators or the courts have jurisdiction over unionized employee claims for their long-term disability (LTD) benefits.[1] In this case, the Court of Appeal determined the matter was outside of the court’s jurisdiction. Leave to appeal to the Supreme Court of Canada was denied on January 14, 2021.

Pursuant to a collective agreement, Ms. Hutton’s employer had agreed to provide LTD benefits coverage to its employees and contracted with The Manufacturers Life Insurance Company (Manulife) to be the benefit provider. The collective agreement provided that eligible employees were entitled to LTD benefits under the Hospitals of Ontario Disability Income Plan (HOODIP), “or [an] equivalent [plan]”. Any disputes concerning an employee’s entitlement to LTD benefits under HOODIP would be subject to grievance and arbitration pursuant to that agreement. However, that provision did not explicitly provide for grievance and arbitration for disputes under an “equivalent” plan.

Ms. Hutton was injured in a car accident and sought LTD benefits from Manulife. She filed a union grievance against her employer, which settled, and an action against Manulife. Manulife brought a summary judgment motion to dismiss Ms. Hutton’s action, arguing that the court lacked jurisdiction over the claim. The motion judge agreed, as did the Court of Appeal for Ontario. In determining whether a benefit plan that is ancillary to a collective agreement falls within exclusive arbitral jurisdiction, the essential question is whether that plan “can be characterized as constituting or forming part of a collective agreement” so as to be enforceable by arbitration. In this case, the LTD benefits plan at issue formed part of the collective agreement. This was enough to conclude the grievance and arbitration provisions of the collective agreement applied to LTD disputes.

The court rejected Ms. Hutton’s argument that because her benefits were provided by Manulife and not HOODIP, the grievance and arbitration procedures under the collective agreement did not apply. Although the dispute arose under Manulife’s policy and not HOODIP, the court read in the words “or equivalent”. The employer contractually bound itself to provide all employees with LTD coverage, and must therefore be a party to any dispute concerning an employee’s entitlement even though the coverage itself was provided by a third party.

Implications:

  1. Long Term Disability claims by unionized employees will usually fall within the jurisdiction of labour arbitrators, even when the employer engages a third-party insurer to provide coverage.
  2. However, insurers providing benefit coverage to a unionized workplace should carefully review the collective agreement, benefits policies, and any other relevant agreements to ensure that employee disputes will be considered to have arisen pursuant to the collective agreement, and therefore between the union and the employer rather than the worker and the insurer.
  3. A summary judgment motion is an effective and efficient way for insurers to seek the dismissal of benefits claims brought by unionized workers.
  4. As leave to appeal this decision to the Supreme Court of Canada has been denied, this decision is authoritative and can be relied on in future matters, unless it is overturned or overridden by subsequent case law or legislation.

[1] Hutton v The Manufacturers Life Insurance Company (Manulife Financial), 2019 ONCA 975, leave ref’d 2021 CanLII 1096 (SCC).

Share on Facebook Share on Twitter Share via email Share on LinkedIn
Subscribe and stay updated
Receive our latest blog posts by email.
Stay in Touch
Allison Buchanan

About Allison Buchanan

Allison Buchanan is an associate in our Employment & Labour group in Toronto. With exceptional experience in all areas of employment and labour law, Allison provides strategic advice on employee hiring, employment standards, employment contracts, human rights and accommodation, harassment and discrimination, executive compensation structures, employee benefit plans, and workplace safety and insurance matters. Additionally, she advises and represents her clients in employment-related litigation and human rights complaints.

All posts Full bio

Matthew Curtis

About Matthew Curtis

Matthew Curtis is a partner in Dentons Canada LLP’s Employment and Labour Group. He advises Canadian and international organizations on a variety of labour and employment matters.

All posts Full bio

RELATED POSTS

  • Labour

Federal Government introduces 10 paid sick days for federally regulated employees

By Emily Kroboth
  • Labour

Supreme Court of Canada to Federally Regulated Employers: No “Without Cause” Dismissals Under Canada Labour Code

By Andy Pushalik
  • Human Rights
  • Labour

Intrusive surveillance systems for security purposes: the line Big Brother must not cross

By Virginie Dandurand

About Dentons

Dentons is designed to be different. As the world’s largest law firm with 20,000 professionals in over 200 locations in more than 80 countries, we can help you grow, protect, operate and finance your business. Our polycentric and purpose-driven approach, together with our commitment to inclusion, diversity, equity and ESG, ensures we challenge the status quo to stay focused on what matters most to you. www.dentons.com

Dentons boilerplate image

Twitter

Categories

  • Amendments to Safety Laws
  • Confidentiality/Trade Secrets
  • Constructive Dismissal
  • COVID-19
  • Criminal Offences by Employees
  • Employment Standards
  • Executive Compensation
  • General
  • Human Rights
  • Immigration
  • Labour
  • Occupational Health and Safety
  • Pay Equity
  • Pensions and Benefits
  • Privacy
  • Restrictive Covenants
  • Union Issues
  • Workers' Compensation
  • Workplace investigations
  • Wrongful Dismissal
  • WSIB

Subscribe and stay updated

Receive our latest blog posts by email.

Stay in Touch

Dentons logo

© 2023 Dentons

  • Legal notices
  • Privacy policy
  • Terms of use
  • Cookies on this site