Liability protection for businesses for COVID-19 issues
Photo by Jakayla Toney on Unsplash

Last week, on November 17, 2020, the Ontario government passed a law providing liability protection for businesses for COVID-19 issues. The new Supporting Ontario’s Recovery and Municipal Elections Act, 2020 is good news for businesses worried about liability if a customer or client is exposed or contracts COVID-19.

The critical, and pretty much deal-breaking carve out for employers, however, is that employers are NOT protected from claims from employees.

Here is the Key Liability Protection Provision:

  • 2 (1) No cause of action arises against any person as a direct or indirect result of an individual being or potentially being infected with or exposed to coronavirus (COVID-19) on or after March 17, 2020 as a direct or indirect result of an act or omission of the person if,
    • (a) at the relevant time, the person acted or made a good faith effort to act in accordance with,
      • (i) public health guidance relating to coronavirus (COVID-19) that applied to the person, and
      • (ii) any federal, provincial or municipal law relating to coronavirus (COVID-19) that applied to the person; and
    • (b) the act or omission of the person does not constitute gross negligence.

Here is the Translation into Human English:

  • A business cannot be sued because its customer, client, etc gets COVID-19; 
  • To enjoy the liability protection, the employer must have acted in “good faith” (even if not reasonable or objectively right) and not done something or fail to do something that amounts to “gross negligence” (not just everyday negligence, but really really really bad negligence);
  • This covers the time period since St. Patty’s Day, 2020 (i.e. March 17th)
  • The “good faith” acts are legit even if the public health guidance and laws at all 3 levels of government were inconsistent and kinda all over the map during 2020 (which they were)

The Great Big Employer But:

Section 4(2) of the Act says the above section 2 liability protection does NOT apply to a cause of action brought by your team in their course of employment, including:

    • a worker
    • a worker’s survivor
    • an individual in the “performance of work” or “supply of services”, which would include independent contractors and freelancers

In other words, an employer is not protected from claims by employees, contractors or freelancers related to “occupational disease” in the course of the worker’s employment or related to an occupational disease.

The specific workplaces impacted are those that are Schedule 1 and Schedule 2 employers under the Ontario workers’ compensation regime.

The new act does expressly state that the Workplace Safety and Insurance Act and the usual workers’ compensation regime will continue to apply, but this act may permit employees to proceed on two fronts (workers’ compensation and civil), although section 4(4) does state that any conflict between the two will default to the workers’ compensation law. 

Take Away for Employers

This is brand new legislation for a wonky year full of brand new situations. While the act is good for businesses generally, the deep carve out around employee claims means employers will likely continue to face the exposure of any potential COVID-19 related issues.

It remains critical to always act in good faith, stay as informed as possible around the ever-changing rules, and to limit exposure for your team as much as possible. This may mean remote working is here to stay for a while longer, as business continues to pivot online.

If this all sounds like you need to continue to right-size and review your workplace infrastructure to survive the economic impact of COVID-19, check out our affordable Pivot DIY Toolkit to help you think through the issues and take action. 

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