A recent decision from the Ontario Workplace Safety and Insurance Appeal Tribunal (WSIAT) lowers the threshold for entitlement to benefits for traumatic mental stress. An important departure from existing decisions, the decision has significant implications for employers in Ontario. Under s. 13 of Ontario’s Workplace Safety and Insurance Act (WSIA), an employee is entitled to receive Workplace Safety and Insurance Board (WSIB) benefits for traumatic mental stress if the employee has “an acute reaction to a sudden and unexpected traumatic event arising out of and in the course of employment”.
The WSIA itself does not define the phrase “acute reaction.” However, the WSIB’s policy on traumatic mental stress clarifies matters somewhat. According to the policy, an acute reaction is a significant or severe reaction to a work-related traumatic event that results in a psychiatric/psychological response. The reaction must result in an Axis I diagnosis in accordance with the Diagnostic and Statistical Manual of Mental Disorders (DSM-IV).
Sudden and unexpected traumatic event
The phrase “sudden and unexpected traumatic event” is also not defined in the WSIA. However, the WSIA does state a claim for mental stress cannot arise solely from an employment decision such as termination, demotion, transfer or disciplinary action; a statement that is positive for employers.
The policy sheds additional light by stating a traumatic event may be a result of “a criminal act, or a horrific accident, and may involve actual or threatened death or serious harm against the worker, a co-worker, a worker’s family member or others.” Examples include:
• witnessing a fatality or a horrific accident;
• witnessing or being the object of an armed robbery;
• being the object of
o physical violence
o death threats
o threats of physical violence where the worker believes the threats are serious and harmful to herself or others (i.e. a bomb threat)
o harassment that includes physical violence, threats of physical violence, being placed in a life-threatening or potentially life-threatening situation.
Previous WSIAT decisions have applied these criteria to limit benefit entitlement to situations in which the traumatic event involves a “real or perceived threat” to a worker, which is life- threatening or potentially life-threatening. This interpretation is consistent with the DSM-IV definition of post-traumatic stress, which requires a life-threatening or potentially life-threatening triggering event. This application of the policy has, until now, provided a degree of predictability for employers by narrowly restricting the circumstances in which a worker is entitled to receive benefits.
Implications for employers
For an employer, this decision has both positive and negative implications. On the positive side, an employee’s entitlement to WSIB benefits is granted in lieu of all rights of action against the employer. As such, an increase in the scope of entitlement to benefits under the WSIA should result in a corresponding decrease in the employee’s right to sue his employer for compensation for traumatic mental stress arising out of or occurring in the course of employment.
Employers should therefore expect to see fewer lawsuits brought by employees for damages for traumatic mental stress. In the event an employer is sued by an employee for such damages, the employer may now be in a stronger position to argue the employee’s right to commence an action against the employer has been taken away by the WSIAT.
On the negative side, this shift in the scope of entitlement to benefits carries with it the potential for a significant increase in the number of successful claims by employees for WSIB benefits for traumatic mental stress. A successful claim typically means an increase in the employer’s cost statement, a reduction in rebates or an increase in annual premiums required to be paid, each of which has financial implications for an employer.