Canada: Must Benefits Coverage Extend To Employees Over The Age Of 65?

The  Human Rights Tribunal of Ontario recently released its decision in Kartna v. Toronto (City), dismissing an application that the termination of long-term disability (LTD) benefits at the age of 65 was discriminatory on the basis of age.

The Tribunal dismissed the application following a summary hearing on the basis that the application had no reasonable prospect of success.

Decision

The case involved an Applicant who had been receiving LTD benefits since April 2011. Consistent with the terms of the LTD plan, those benefits were terminated in September 2013 when the Applicant reached the age of 65.

The Applicant argued that a plan cutting off LTD benefits at age 65 had the effect of forcing an employee into retirement. Further, as mandatory retirement was discriminatory, the provisions of the ESA (referenced below) reflected an outdated and inequitable approach to retirement.

The Tribunal found that the differential treatment complained of by the Applicant was permitted by a plain reading of the Human Rights Code (the Code), the Employment Standards Act, 2000 (the "ESA") and Regulation 286/01 under the ESA (the ESA Regulation).

Specifically, Section 25(2.1) of the Code provides an exemption for differential treatment on the basis of age in group insurance contracts, provided that such treatment is not inconsistent with the provisions of the ESA. Although section 44(1) of the ESA similarly prohibits employers from providing benefits plans to employees on a differential basis because of age, the ESA Regulation defines "age" for these purposes as being between the ages of 18 and 64. Taken together, and as the Tribunal confirmed, these provisions limit the ESA's prohibition on differential treatment on the basis of age in respect of group insurance contracts (including LTD plans) such that it does not apply to persons aged 65 and over.

Our Views

While an employer may certainly choose to extend benefits to employees who are 65 and over, confirmation by the Tribunal that a decision not to do so does not contravene the Code provides a useful precedent for employers, particularly in light of Canada's increasingly aging workforce.

Although some have attempted to argue that the legislative provisions discussed herein contravene the equality rights protected by section 15 of the Charter, it appears that this question has yet to be dealt with by the Tribunal. Until such time, we expect that the Tribunal will continue to interpret these Code and ESA provisions in the manner described above.

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