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LABOUR RELATIONS - Employees - Insured benefit plans

Monday, February 10, 2020 @ 9:05 AM  


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Appeal by the plaintiff from summary judgment dismissing her action against the long-term disability insurer for lack of jurisdiction. The appellant was a hospital worker and a union member. The employer contracted with the respondent to provide insurance benefits to eligible employees. The collective agreement provided that an eligible hospital employee was entitled to long-term benefits under the Hospitals of Ontario Disability Income Plan and that any disputes were to be resolved by grievance and arbitration. After she was insured in a motor vehicle accident, the appellant received long-term disability benefits for 17 months before the respondent determined that she was no longer eligible for benefits. The appellant then commenced an action for breach of contract, entitlement to benefits and punitive damages against the insurer. The motion judge dismissed the action finding that the claim arose out of the collective agreement and was thus subject to exclusive arbitral jurisdiction under the collective agreement. The appellant argued her claim arose under the respondent’s policy and not under the Hospitals of Ontario Disability Income Plan.

HELD: Appeal dismissed. The motion judge was correct in his conclusion in this case. The collective agreement referred only to the Hospitals of Ontario Disability Income Plan and contemplated that employees would be entitled to the level of coverage provided by the Plan. The employer’s obligations under the Plan formed part of the collective agreement. This alone was enough to conclude that the grievance and arbitration provisions of the collective agreement applied to long term disability disputes. The dispute resolution clause in the collective agreement expressly provided that any dispute concerning an employee’s entitlement to short-term or long-term benefits under the Plan could be subject to grievance and arbitration under the provisions of the agreement. The true substance of the appellant’s dispute was a disagreement with her employer over her entitlement to long-term benefits as outlined in the collective agreement. This clearly arose from the collective agreement and fell within the purview of an arbitrator to decide.

Hutton v. Manufacturers Life Insurance Co. (c.o.b. Manulife Financial), [2019] O.J. No. 6240, Ontario Court of Appeal, G.R. Strathy C.J.O., R.J. Sharpe and L.B. Roberts JJ.A., December 12, 2019. Digest No. TLD-February102020001