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Cutting Off Employee Benefits at 65 deemed Unconstitutional: Talos v. Grand Erie District School Board

It’s not often that the Toronto Injury Lawyer Blog comments on cases decided at the Human Rights Tribunal of Ontario.

The reason being is that car accident cases, slip and falls, long term disability cases, motorcycle accidents etc. are all dealt with before the Ontario Superior Court; not the Human Rights Tribunal.

But ever so often, cases heard at the Human Rights Tribunal of Ontario intercede with cases relevant to the field of personal injury law in Ontario.

Talos v. Grand Erie District School Board is one of those cases.We here at Goldfinger Injury Lawyers believe this to be a very important decision for employees, employers, insurance companies and lawyers alike.

In 2006, the Province of Ontario passed a law that ENDED an employer’s right to terminate an employee at the age of 65. This allowed people to work much longer, and ended discriminatory practices based on age to people over 65.

But the the Ontario Human Rights Code and Employment Standards Act still allow employers to cut workers off benefits when they turn 65. So, on one hand employees could work beyond the age of 65; but on the other hand, employers were NOT legally obliged to pay those elderly employees benefits beyond the age of 65.

Something didn’t add up…..

Enter Mr. Talos’ case against the Grand Erie District School Board.

In his case Mr. Talos made an application to the Human Rights Tribunal to allege that an exception in the Human Rights Code that permits employers the discretion to terminate benefits for workers over age 65 infringed his equality rights and was unconstitutional. His extended health, dental and life insurance benefits were terminated when he reached aged 65 although he continued to work on a full time basis. He was an experienced secondary school teacher and was enthusiastic about contributing as a teacher although he could retire and receive a pension and other government benefits that accrued to Ontario residents of that age. He was also financially motivated to work as he needed the health benefits that had for decades effectively augmented his remuneration. These benefits assisted greatly with the medical and other expenses that his family faced because his wife had become gravely ill. She had no employer sponsored benefits and, as she was younger than 65 years old, she did not qualify in her own right for various government income supports like Old Age Security and Ontario Disability Drug Benefits Plan. The family was able to apply for and receive some financial support from the needs-tested Ontario Trillium Drug program that covered partial costs for certain drugs. The family was still out of pocket for a considerable sum and was deprived of the peace of mind one associates with having an insurance plan that covers unpredictable eventualities. Mr. Talos seeks monetary compensation of $160,000 for lost benefits and compensation for injury to dignity, feelings and self-respect.

Mr. Talos’  Application was filed under s. 34 of the Human Rights Code, R.S.O. 1990, c. H.19, as amended (the “Code”), and alleges discrimination with respect to employment because of age.  He alleged that his employer, the  Grand Erie District School Board, breached s. 5(1) of the Code, on the basis of age when he turned 65, because the employer terminated his membership in the various employer benefit and pension plans without any actuarial justification. At the start of this hearing, the allegation of discrimination was limited to group health, dental and life insurance benefit plans, excluding long-term disability insurance, superannuation and pension plans from consideration in the instant constitutional challenge.

The Tribunal found that Mr. Talos’ entitlement at age 65 to OAS (dependent on length of residency) and CPP (that can be postponed to age 71) cannot justify the termination of workplace benefits that effectively reduces a worker’s compensation package. There is no legislative basis for this reduction of workplace benefits in favour of receipt of publicly funded benefits…

In the period of over a decade since the passage of Bill 211, census data, Dr. Berger’s and Dr. Janzen’s evidence shows that an increasing number of workers continue to work past age 65. Effectively, over time, the impugned provision of the Code, in conjunction with the relevant provisions of the ESA and its Regulations, has resulted in an increasing number of workers being made vulnerable to the termination of workplace benefits without any actuarial justification.0001r_Goldfinger-200x300

There appears to have been little or no thought given to minimizing the impairment of equal compensation and Code access for workers age 65 and older… . The “carve out” is all encompassing and is insensitive to whether a particular benefit programs is closely related to age in terms of the cost or the need for the benefit for employees age 65 and older.

What does this decision mean for you? It means that employers can’t justify cutting off workers from benefits when they hit the age of 65. It means that workers 65 and older will be protected by benefit plans, even it’s expensive to keep them on those plans.

For employers, this means that the cost of insurance plans for their employees will likely increase because they have to insure employees 65 and older. Actuarial data shows that people 65+ are more expensive to insure than younger employees.

For insurers, it means they have to revisit their policies to ensure that the people 65+ are NOT excluded from protection. They will also have to revisit how they charge benefits on each plan because those costs are likely to increase.

This decision begs the question: if CPP can be deferred up to the age of 71; and empirical data shows that people are working beyond the age of 65; then why do all Long Term Disability policies through companies such as Great West Life, Manulife, SunLife, Industrial Alliance, SSQ, Desjardins, Co-Operators, RBC etc. have long term disability benefits ending at the age of 65???

If someone intended to work to the age of 71, or 75, then why should their long term disability benefits be terminated 5-10 years earlier? That never sat right with anyone at our law firm and still doesn’t sit right with us today. Employees should demand more of their group insurance plans to make sure they are getting coverage well in to their later years of work.

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