Conviction can now lead to fines of up to $2 million for employers in province
The recent statutory changes in Ontario concerning past non-compliance being considered an aggravating factor in sentencing have significantly reshaped how employers approach Occupational Health and Safety (OHS) orders. And the implications for companies are profound, as fines and imprisonment penalties have escalated.
According to Madeleine Loewenberg, a lawyer, workplace investigator, the risk is clear.
“For individuals now in Ontario, the risk of being liable for a fine… is a fine of not more than $500,000 or imprisonment for a term of 12 months. Now, fines and the magnitude of $500,000 and imprisonment are not imposed every day, but that is the maximum fine, and that’s a significant increase.”
For employers, especially corporate directors or officers, the stakes are even higher. Conviction can now lead to fines up to $2 million for employers. Loewenberg emphasizes that this substantial increase “came into place less than a year ago”. Directors and officers face potential fines of $1.5 million or imprisonment. These changes highlight the importance of addressing repeat offenses promptly, as “the potential arises where there are, in particular, significant repeat offenses.”
Companies have taken proactive measures to minimize the risk of these penalties, particularly by appealing OHS orders more frequently. Loewenberg suggests that employers must “appeal more vigorously and perhaps more regularly than one might have thought in the past,” especially since not doing so can exacerbate legal risks. There is a legal risk of increased fines if the employer is prosecuted for a health and safety offense tied to the order. There is also a risk that the orders can be introduced as evidence in future trials; if an employer neglects to appeal an order, it could be used as evidence supporting conviction in court.
Realistic strategies
“If, for example, you’re an employer... it is a good idea to appeal the order, because not only might it increase your fine if there’s a trial... but if there’s a trial, the Crown can put that order before the court,” adds Loewenberg.
In terms of realistic strategies, companies are increasingly turning to legal counsel to assess their chances of success when considering appeals. Loewenberg stresses that seeking experienced counsel is critical, particularly when facing potential charges. Employers must scrutinize the OHS orders they receive, carefully evaluating how they are identified in the order and what legal risks are at play.
“Ask yourself whether the order implies legal status... if you think there is [a risk of prosecution] as a party with responsibilities under the OHSA, and you dispute that characterization, that’s, again, a very good reason to appeal that order.”
Another key point is the importance of recognizing the financial implications of non-compliance. Some companies may balk at the cost of appealing an OHS order, thinking the immediate expense is unnecessary. However, Loewenberg warns that “a Crown may be more likely to press your matter to trial or to seek an increased penalties against you if the evidence against you appears to be strong,” and thus, the short-term cost of an appeal pales in comparison to the long-term financial impact of a prosecution and/or imposed penalties.
To streamline the appeal process and reduce potential legal costs, many companies are adopting best practices. These include working closely with trusted legal counsel who are familiar with the case law and the appeal process. Loewenberg suggests building a “precedent bank,” allowing employers to familiarize themselves with common forms and interpretations, thus minimizing future costs. This approach not only helps with compliance but also enables companies to anticipate potential challenges before they escalate. Loewenberg cautions that each case must be determined on its own merits and employers should not overly use or rely on precedents.
In addressing mistakes employers often make, Loewenberg points out the dangers of complacency. Many employers mistakenly assume that compliance with an OHS order will mitigate future penalties. However, the legal reality is more nuanced. Loewenberg compares case law from 2017 that held complying with an order is not a mitigating factor with the recent changes in the legislation, which suggest otherwise “given the fact that compliance with the order [and] regulatory history are now specific factors set into the legislation.”
It’s also essential that employers avoid falling into the trap of seeing inspectors as allies.
“The inspector may be kind. They may be helpful. At the end of the day, they’re an agent of the regulator... Their job is to ensure compliance with the Act,” Loewenberg notes.
Loewenberg also touches on the long-term consequences of non-compliance and repeat offenses. Aggravating factors, such as “disregarded orders” or a “record of prior non-compliance,” have been codified into Ontario’s Occupational Health and Safety Act, making them particularly relevant. Loewenberg emphasizes that companies should treat these factors as warnings, ensuring that they don’t become repeat offenders. This includes keeping meticulous records of compliance efforts, which could play a crucial role in future legal proceedings.
Ultimately, the key takeaway for companies is the importance of taking OHS orders seriously and acting promptly. Failing to comply with or appeal orders in time could lead to greater legal exposure and higher fines, particularly given the new statutory framework. For employers facing significant fines or even imprisonment, the cost of compliance and appeal processes is far outweighed by the potential consequences of non-compliance.
As Loewenberg aptly sums up: “It’s not necessarily that significant a cost to appeal an order... I would just say, don’t let cost outweigh everything else.”
