Friday, January 24, 2014

Compliance with regulatory order not mitigating factor on sentence

Ontario (Labour) v. Flex-N-Gate Canada Company, 2014 ONCA 53 deals with an employer which breaches a provision of the Occupational Health and Safety Act (OHSA), R.S.O. 1990, c. O.1, resulting in a workplace accident.  A government inspector investigates the accident and orders the employer to comply with the provision.  The employer does so.  In sentencing the employer for breach of the Act, should the court treat the employer’s “corrective action” as a mitigating factor?  The Court says no:
[20]   This court discussed the objectives of the OHSA in R. v. Ellis-Don Ltd. (1990), 1 O.R. (3d) 193 (C.A.).  At paras. 81-82 of his reasons, Carthy J.A. emphasized the objective of accident prevention:[4]
The preceding analysis of the statute and the defence of due diligence leaves me in no doubt of the pressing and substantial objective of the Act, generally, to prevent accidents in the workplace, and, as to s. 37(2) specifically, that the balance of probabilities test furthers that objective.  The Act is directly focused on accident avoidance through measures taken in advance of mishaps and because it applies to a segment of commercial society where there is necessarily a dependence upon profits, measures are needed to assure that workers’ safety is not forgotten. 
Vigilance, expense, effort, attention and record-keeping are an absolute mandate to keep such incidents to a minimum.  The odds of an accident happening are inevitably reduced by the time, attention and expense devoted to avoidance. 
[21]   The philosophy of the OHSA is to promote a health and safety system that relies on the internal responsibility and voluntary compliance of individual employers.  In other words, workers are best protected when their employers install procedures in their workplaces that will prevent accidents from occurring.  Rewarding an employer for taking corrective action only in response to an inspector’s order reduces an employer’s incentive to take this action before an accident occurs.
[22]   Rewarding post-offence compliance with an inspector’s order also reduces the deterrent effect of sentences for breach of the OHSA.  Deterrence has long been regarded as the most important sentencing principle for OHSA offences.  This court’s decision in R. v. Cotton Felts Ltd. (1982), 2 C.C.C. (3d) 287 (Ont. C.A.) remains the leading decision on the sentencing of OHSA offenders.  At paras. 19-20 and 22, Blair J.A. discussed the relevant considerations and stressed the “paramount importance” of deterrence:
The Occupational Health and Safety Act is part of a large family of statutes creating what are known as public welfare offences.  The Act has a proud place in this group of statutes because its progenitors, the Factory Acts, were among the first modern public welfare statutes designed to establish standards of health and safety in the work place.  Examples of this type of statute are legion and cover all facts of life ranging from safety and consumer protection to ecological conservation.  In our complex interdependent modern society such regulatory statutes are accepted as essential in the public interest.  They ensure standards of conduct, performance and reliability by various economic groups and make life tolerable for all.  To a very large extent the enforcement of such statutes is achieved by fines imposed on offending corporations.  The amount of the fine will be determined by a complex of considerations, including the size of the company involved, the scope of the economic activity in issue, the extent of actual and potential harm to the public, and the maximum penalty prescribed by statute.  Above all, the amount of the fine will be determined by the need to enforce regulatory standards by deterrence.
The paramount importance of deterrence in this type of case has been recognized by this Court in a number of recent decisions.
Without being harsh, the fine must be substantial enough to warn others that the offence will not be tolerated.  It must not appear to be a mere licence fee for illegal activity.
See also R. v. Inco Ltd. (2000), 132 O.A.C. 268.
[23]   Deterrence is undermined by treating statutorily required compliance as a mitigating factor on sentence.  Rewarding an employer for action that it should have taken before an accident happened creates an incentive to put off compliance. 
[24]   In a comparable regulated field, the environmental field, several sentencing courts have rejected the argument that a company’s remedial action after a mishap has occurred should be mitigating.  For example, in R. v. Echo Bay Mines Ltd. (1980), 12 C.E.L.R. 38, a judge of the Territories Court held, at para. 13:
Similarly, while the response to the spill and the subsequent plans and efforts to upgrade and change the fuel handling system show a serious concern to prevent any future occurrences such as this, they are after the fact, as it were.  This legislation is not intended to encourage compliance after an environmental mishap but rather to demand compliance before those mishaps occur so as to prevent them.
[25]   And, in R. v. Van Waters & Rogers Ltd. (1998), 220 A.R. 315 (Prov. Ct.), Fradsham J. of the Alberta Provincial Court wrote, at para. 45:
The fact that there were things that could have been done to prevent the spill, and that they were capable of being discerned and implemented, may well aggravate, and not mitigate, the offence.  In my view, the expenditures made by Van Waters for remedial action are monies it should have spent before the spill.  I do not consider those expenditures particularly mitigating.  The best that can be said is that Van Waters has not evidenced recalcitrance in acknowledging its previous failures.
[26]   The reasoning in these two cases is persuasive.  Indeed, in this province, the legislature has expressly prohibited courts from treating compliance with an order under the Environmental Protection Act, R.S.O. 1990, c. E.19 as a mitigating factor on penalty.  Section 188.1(4) of that Act now states:
Subject to subsection (5), in determining a penalty under section 187, the court shall not consider compliance with an order issued under this Act in response to the offence to be a mitigating factor.
[27]   This provision puts the issue beyond debate for environmental offences.  However, for the reasons I have discussed, even without a legislative prohibition, the same principle should apply to the sentencing of employers for OHSA offences.  For these reasons, I do not agree with the sentencing decision of the appeal court judge. 

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