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Ontario Court of Appeal Rules that Compliance with the Law is Not a Mitigating Factor, and there is no Jurisdiction for Concurrent Fines under OHSA

In its recent decision of R. v. Flex-N-Gate Canada Company, 2014 ONCA 53, the Ontario Court of Appeal ruled that post-accident compliance with mandatory orders from the Ministry of Labour should not mitigate fines against employers for breach of the Occupational Health and Safety Act (“OHSA”), and that there is no jurisdiction for a Court to make multiple fines for multiple offences concurrent under the OHSA.

The company, Flex-N-Gate, produces vehicle bumpers.  In 2004, an accident occurred at the company’s plant in which a stack of sheet metal fell from a forklift, striking an employee on the foot and causing significant injuries.  The Ministry of Labour investigated the accident and issued two compliance orders: first that the company comply with the terms of the OHSA and its Regulations pertaining to the safe movement of material; and secondly that the company be prohibited from using the equipment involved in the incident until it complied with the first order.  The company immediately complied with the orders.

At trial, the Provincial Court held that the company was guilty of two offences under the OHSA: failing to ensure that material was moved in a manner that did not endanger the safety of a worker; and failing to provide information, instruction, and supervision to protect the health and safety of workers.  The Court imposed a fine of $50,000, being $25,000 for each offence.

The Company appealed the decision to the Ontario Court of Justice.  That Court decided it would not disturb the decision of the lower Court on the conviction, or the value of the fines.  However, the Court decided that the company’s immediate compliance with the Ministry of Labour’s Orders prior to hearing was a mitigating factor in the company’s favour.  The Court therefore held that the fines ought to be paid concurrently, meaning that Flex-N-Gate would pay a total of $25,000 in fines, rather than the original $50,000.

The Crown was granted leave to appeal to the Ontario Court of Appeal on two issues: 1) Whether compliance with an order can be a mitigating factor in determining value of a fine; and 2) whether the Court could make the fines concurrent.  The Court of Appeal granted the Crown’s appeal on both issues. 

The Court of Appeal decided that an employer’s corrective action taken in response to an investigator’s order should not mitigate the sentence.  It stated that rewarding the company for complying with post-accident orders required by law would be a disincentive for other employers to take corrective action before an accident occurs.  It would also be harder to carry out the deterrent purpose of OHSA penalties if a guilty party could simply comply with an order after they are caught breaching the OHSA, then expect a mitigated sentence after trial.

The Court did state however that corrective action taken by a company could be a mitigating factor if it went above and beyond the scope of a Ministry of Labour compliance order, or if it was undertaken prior to an accident.

On the second question before it, the Court of Appeal reviewed its prior case law and determined that only custodial sentences could be concurrent, and not fines.  The lower Court had no jurisdiction to make the two $25,000 fines concurrent, and so the Court of Appeal reinstated the Provincial Court’s sentence of two $25,000 fines.

There are two points that employers should take from this decision.  First, if you want to get into the good graces of the Courts and the Ministry of Labour, you will have to do more than comply with orders made pursuant to the OHSA.  Going above and beyond the statutory requirements before an accident occurs is the best way to mitigate any potential sentence against your company in the event of a health and safety conviction.  Secondly, do not expect that the Courts will deviate from their history of handing down multiple fines for each of multiple convictions under the OHSA.

Of course your first, and best line of defence, is due diligence and compliance with the law.  The lawyers at CCPartners are experienced with helping employers understand and comply with their obligations and responsibilities under the Occupational Health and Safety Act.