C45 – THE CRIMINALIZATION OF
OCCUPATIONAL HEALTH & SAFETY OFFENCES

Employers need to be aware of new federal legislation
effective January 1, 2004 that established an offence of
Occupational Health & Safety (OH&S) Criminal Negligence.
This new law criminalizes OH&S offences.

No doubt you have seen the following headlines:

From pinstripes to prison stripes
From the Boardroom to the Courtroom
Bringing Vicarious Criminal Liability into the Board Room.

To understand the impact of these headlines one needs to go back to September 11, 1991 to the small county of Pictou in the Province of Nova Scotia when 500 people attended the official opening of the Westray mine. The atmosphere at the grand opening was jovial and upbeat because the opening meant that 300 jobs would be created and the jobs would last at least fifteen years. What those in attendance didn’t know was that the Provincial Minister of Labour had received a letter in July warning that the new Westray coal mine “is potentially one of the most dangerous in the world”. Several months later a memo is authored suggesting that the grave safety situations present at the mine may in fact lead to deaths.

A few months later, on May 9, 1992 at 5:18a.m the residents of Pictou County and surrounding areas are awakened by the sound of windows shattering and the effects of an explosion. Their worst fears are quickly confirmed.  There had been an explosion at the mine and all 26 miners in the mine had perished. The extent of the tragedy had just begun and the families soon learn that poor conditions at the mine were known by the workers, mine management and government regulators. 

Occupational Health & Safety charges were laid and withdrawn by the N.S. Department of Labour, criminal negligence charges were laid and then stayed and the Supreme Court of Canada ordered a new trial – that never took place.

A public inquiry was undertaken which produced Recommendation
# 73 which stated:  “The government of Canada through the Department of Justice, should institute a study of the accountability of corporate executives and directors for the wrongful or negligent acts of the corporation and should introduce in the Parliament of Canada such amendments to legislation as are necessary to ensure that corporate executives and directors are held properly accountable for workplace safety.”

On June 12, 2003 Bill C45 was tabled for first reading passed by the House and Senate in October and received Royal Assent on November 7, 2003.  It will become law upon its proclamation, expected in mid February.

C45 creates a new offence of "Occupational Health & Safety Criminal Negligence".  Essentially, it exposes employers (broadly defined) and senior officers (broadly defined) to prosecution for wanton or reckless disregard of OHS problems.

Q.  What employers are covered?
 
A. The Bill, which is an amendment to the Criminal Code of Canada applies not only to corporate employers, but also an "organization" which could be a society, a partnership, a municipality, and to an "association", which is a group created for a common purpose which holds itself out to the public as an association.

Q.  Does the Bill create a new Criminal Code offence?

A.  There is now an offence of occupational health and safety criminal negligence.

Q.  Who can be charged?

A.  This is broadly defined as including everyone who directs how another person does work.  It could impose criminal liability from the plant manager down to a lead hand.  It also imposes upon the "organization" liability for the acts of its senior officers if they depart "markedly" from the standard of care that would reasonably be expected.

Q. What steps should the Board take to meet its obligation under the Bill?  What are recommended best practices?
 
A. Institute “best practices” re corporate governance – due diligence must be seen as more than a defence. Corporations must have a corporate compliance program in place that targets health and safety concerns.
 
Q. Can the Directors or the organization get insurance?
 
A.  No.  This Bill creates an offence under the criminal code.  Insurance for such acts or omissions is not available
 
Q. What sort of behaviour will amount to a violation of the Bill?
 
A. Reckless disregard by a person in authority of the health and safety of workers.
 
Q. What is the range of penalties for the employer and for its senior officers?

A.  For individuals, in the event their criminal negligence has caused injury, up to 10 years in prison, and in the event it has caused death, up to life imprisonment.

Q.  What factors will be taken into account in determining sentencing:

• The economic advantage gained by committing the crime – the more money the organization made, the higher the fine;
• The need to keep the organization running and preserve employment;
• The cost of investigation and prosecution;
• Any regulatory penalties, which are imposed on the organization for the offence. For example – the courts consider whether the individual/s have been punished in other ways, by losing their jobs;
• Previous convictions or regulatory offences;
• Restitution – compensating victims show that the organization is trying to make up for the harm it caused;
• Attempt to hide assets to avoid paying a fine;
• Measures taken to reduce the likelihood of further activity.

The Bill proposes to put in the Code a specific section dealing with probation orders for organizations. The list of conditions the judge can impose includes:

• Providing restitution to victims of the offence;
• Requiring the corporation to inform the public of the offence, the sentence imposed and the remedial measures being undertaken by the organization.

The new section also sets out conditions that may be imposed by the court to supervise the efforts of the organization to ensure it does not commit crimes in the future.
 
Bill C-45 is an important development in Canadian law, impacting all employers, their directors and senior management.  It will not be enough for individuals to assume that they are in compliance, because someone in the corporation is looking after OHS matters.

This article was contributed by:

R. Ross Wells is a partner in the Waterloo office
of Gowlings.  His Practice emphasizes labour and
employment law in both union and non-union sectors.  Ross is a member of the Board of Directors of the Employers’ Advocacy Council.
 
R. Ross Wells, Partner
Gowling Lafleur Henderson LLP
1020- 50 Queen St N
Kitchener, ON  N2H 6M2
(519) 576-6910
ross.wells@gowlings.com
www.gowlings.com

Sherri Helmka is the Executive Director of the Employer’s Advocacy Council.  EAC is a non-profit organization funded by employers for employers.  EAC is a leading source of information on workplace safety and insurance and OH &S, through their newsletters, member bulletins, education and website.  For more information, contact Kristen at (519) 748-5771, Kristen@EACforEmployers.org

Sherri Helmka, Executive Directory
Employer’s Advocacy Council (EAC)
4 – 625 Wabanaki Dr
Kitchener, ON N2C 2G3
(519) 748-5771
sherri@EACforEmployers.org
www.EACforEmployers.org