Age limit of 65 for long-term disability benefit coverage is not a violation of the Charter

In spokesman v uniforlocals 256 and 89 arbitrator Paula Knopf dismissed a union policy grievance alleging that an age limit of 65 for Long Term Disability (LTD) benefit coverage under the parties’ collective agreement (CCA) violated the Canadian Charter of Rights and Freedoms(Charter). For reasons specific to the wording of the AML, arbitrator Knopf separately upheld a union policy grievance that the AML required the continuation of life insurance, without reduction, beyond age 65. On both issues, the arbitrator’s decision was based largely on the particular circumstances in this case, but the decision is a useful reminder for employers to be aware of best practices and the interaction between the CBA and benefit policy wording, and more generally the potential for Charter claims regarding differential treatment under benefit plans, particularly for employees in Ontario.

ILD Benefits

In dismissing the union’s ILD grievance, arbitrator Knopf considered the relevant provisions of the Ontario human rights code (Code), which protects the right of every person to equal treatment in employment without discrimination based on age (among other enumerated grounds), exceptions to Code protections for benefit plans that comply to Employment Standards Act 2000 (ESA) and Article 8 of the ESA Regulation 286/01 (which specifically allows for age differentiation with respect to short and long term disability plans). The union argued that these “exclusions” under the Code (referring to the ESA) could not apply to the age limit of 65 applicable to LTD benefit coverage under the CCA at issue because the Charter took precedence over the Code and ESA, and guarantees the protection and equal benefits of the law without discrimination on the basis of age, without any specified age limit. In other words, it was asserted that the statutory exclusions in the Provincial Code (referring to the ESA) did not comply with the guarantees provided for in section 15 of the Charter and therefore inapplicable in this case. Arbitrator Knopf agreed that the age threshold of 65 for LTD coverage was At first glance discrimination and was contrary to the equality protections of subsection 15(1) of the Charter, but found that the restriction was, on the specific facts of this case, justifiable and reasonable and, therefore, saved by the section 1 of the Charter. In making this decision, Arbitrator Knopf referred to Arbitrator Etherington’s earlier decision in Chatham-Kent (Municipality) c. Ontario (Attorney General)1 and the conclusion drawn in this case that differential treatment with respect to participation in group benefit and insurance plans may constitute a reasonable limit on equality rights.

Based on the facts of that case, Arbitrator Knopf determined that the age limit for LTD coverage was reasonable and justifiable, within the meaning of section 1 of the Charter, for the particular workplace at issue. In support of this finding, Arbitrator Knopf noted that:

  • Age 65 is above or coincides with when employees can access unreduced government benefits and unreduced employer pensions, and is older than the average retirement age at that specific workplace (which has been identified as very physically demanding).
  • The termination of LTD at age 65 created no significant disadvantage for these employees and was the result of free collective bargaining, not stereotyping or prejudicial treatment.
  • The cost of extending LTD coverage for employees over 65 could affect the balance of interests reached by the parties in their complex collective bargaining process (a constitutionally protected process that should not be not interfere lightly). Given the evidence that only a small number of members of the bargaining unit had worked past their 65th birthday, it was reasonable to allocate resources in the manner chosen by the parties.
  • Arbitrator Knopf further distinguished the decision of the Human Rights Tribunal of Ontario in Talos v. Grand Erie District School Board, which concerned the loss of health and welfare (non-LTD) benefits. In Talos, the Court determined that Mr Talos was deprived of health and welfare benefits at the age of 65 with no viable alternative, which he felt he needed due to his family’s personal circumstances. Contrary to the facts of Talos, Arbitrator Knopf pointed to the pension and other benefits offered to spokesman employees after reaching the age of 65, which she argued were important contextual factors distinguishing this case from Talos.

    Life insurance

    Unlike the issue of LTD benefits, the union’s life insurance grievance dealt with the specific wording of the CTC, which arbitrator Knopf said did not clearly provide for the termination or reduction of insurance. -life at or after age 65. For example, while a life insurance policy providing for reduced coverage after age 65 had been in place for many years, arbitrator Knopf held that the reduction was not previously widely understood or known to union officials. In light of this, Arbitrator Knopf concluded that it would be unfair to preclude the union from relying on the language of the CTC.

    As the employer’s life insurance policy did not provide coverage after age 65, the result of this decision was that the employer would have been directly liable for any related claims.

    Key points to remember

    Arbitrator Knopf’s decision in spokesman that an age limit of 65 on LTD coverage under the applicable CLA may be considered justifiable and reasonable and therefore saved by section 1 of the Charter will provide some reassurance to employers who have adopted policies or similar practices.

    However, employers should keep in mind that the analysis undertaken was fact-based and that age limits imposed in other workplaces may not pass Charter scrutiny. It is possible, for example, that the spokesman case could have been decided differently if the company had not provided employees with access to other income supports (i.e. assessing any Charter risk associated with age limits on the provision of LTD and other benefits based on their own circumstances, including the availability of other income supports/benefits for employees as well as the demographics of their workplace.

    The decision is also notable for employers because it highlights the importance of adopting clear language in collective agreements that reflects the real and current intent of the bargaining parties. Employers should also seek to clearly and regularly communicate employee benefits and rights, including related limitations, to build awareness and mitigate the risk of misunderstandings and related claims.

    If you have any questions regarding this decision and/or the differential treatment of employees under benefit plans for age-related or other reasons, please contact the Bennett Jones Employment Services group.


    1. [2010] OLAA No. 580

    The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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