• Tony Wong

Am I Barred From Claiming Constructive Dismissal or Wrongful Dismissal if I Quit Due to Stress?

Section 31 of the Workplace Safety and Insurance Act (WSIA) provides a party to an action (usually the employer defendant) with the right to apply to the Workplace Safety and Insurance Appeals Tribunal (WSIAT) to determine whether the right of action has been statute barred by the WSIA. It creates tremendous amount of confusion as to what is statute barred and what's not. We will give you a high-level summary as to what's caught by the Section 31 and what's not.


Table of Content:

  1. Where Can I Sue for Job Related Stress and what's the Time Limit?

  2. The Interplay Between WSIA and Work Related Mental Stress

  3. Is Human Rights Claim Related to Job Related Stress Barred by WSIA?

  4. Is A Wrongful Dismissal Claim involving Workplace Harassment Barred by WSIA?

  5. Is A Constructive Dismissal Claim involving Work Related Stress Barred by WSIA?

  6. The Morningstar Decision

  7. The “Inextricably Link” Test

  8. Guiding Principle In a Dismissal Case

  9. Conclusion

1. Where Can I Sue for Job Related Stress and what's the Time Limit?


Workplace Safety and Insurance Board (WSIB)


For chronic mental stress and traumatic mental stress. Usually a clinical diagnosis by a psychologist or a psychiatrist pursuant to the DSM-5 standard is required.


Time Limit to File Complaint: 6 Months within the Incident.

Human Rights Tribunal of Ontario (HRTO)


For Discrimination prohibited by the Human Rights Code of Ontario.


Time Limit to File Complaint: 12 Months within the Incident.

Ministry of Labour – Health & Safety (MOL)


For mental stress not qualified as chronic mental stress or traumatic mental stress.


Time Limit to File Complaint: 12 Months within the Incident

Civil Court (Small Claims Court & Superior Court)


Subject only to the limitations pursuant to the Limitations Act.


Time Limit to File Complaint: 2 years within the Incident


Click here to learn more about where to sue for Constructive Dismissal, and click here to learn more about where to sue for wrongful dismissal.

2. The Interplay Between WSIA and Work Related Mental Stress


Section 26 of the WSIA stated that ALL actions caught by the WSIA are to be be "heard and determined" by the Workplace Safety and Insurance Board (the Board).


Section 13(1), 13(4), 13(4.1), 13(5) states that when an employer is covered by the insurance plan set out in Part 3 of the WSIA, any and all claims relating to for chronic mental stress or traumatic mental stress arising out of and in the course of the worker’s employment are caught by the WSIA.


In simple plain English, under WSIA, a qualified mental stress are deemed to be a form of "personal injury by accident". If you quit you work as a result of a work related mental stress, and file for a lawsuit in Court against the Employer Defendant, he or she can file an application to the WSIAT to have the lawsuit dismissed pursuant to Section 31 of the WSIA.


Please recall that while you have 2 years to file your lawsuit to Court in related to your job related stress, you ONLY have 6 months to file a WSIA claim. The deadline to submit a WSIA claim would most certainly have expired by the time the Section 31 application is heard by the WSIAT. In other words, in that case, your action will be statute barred, and you will receive NO compensation for the mental distress you suffered.


It's of paramount importance that you file your mental anguish claim to the Right Forum!!

3. Is Human Rights Claim Related to Job Related Stress Barred by WSIA?


Fortunately, no. Note that prior WSIAT jurisprudence has determined that the Appeals Tribunal does not have the authority to make a finding that the WSIA removes the right to bring an application under the Human Rights Code.


Decision No. 1241/16, 2016 ONWSIAT 3520 is an example showcasing this principle. In that case, the Plaintiff worker brought an action against the employer defendants seeking damages for breach of human rights, and claimed that the defendants removed themselves from the employment relationship (i.e. a breach of contract) by their intentional actions and that abusive behaviour by a manager resulted in chronic stress. In essence, the Plaintiff argues that the Defendants breach the contract by failing to provide the workers with a safe work environment. The Defendants brought a Section 31 application to the Workplace Safety and Insurance Appeals Tribunal (WSIAT).


The Appeals Tribunal held that the allegation of breach of contract is essentially the same harm which forms that basis of her claim for personal injury, and that the plaintiff's right of action was taken away in related to her mental distress, but the element of the action claiming damages from breach of human rights can continue.

4. Is A Wrongful Dismissal Claim involving Workplace Harassment Barred by WSIA?


Hell No!! The current state of law is that if it’s a wrongful dismissal, i.e. an employee has been terminated by the employer, then the employee can sue in Superior court.


Decision No. 3836/17, 2018 ONWSIAT 593 is an example showcasing this principle. In that case, the plaintiff worker brought an action against his employer for wrongful dismissal in Civil Court. The defendant employer applied to the WSIAT to determine whether the plaintiff's right of action was taken away pursuant to Section 13, 26 and 31 of the WSIA.


The Appeal Tribunal held at paragraph 12 that:


The preponderance of Tribunal decisions have found that an action for wrongful dismissal is not statute barred (see for example Decision No. 194/16). That being said however, simply framing a claim as an action for wrongful dismissal cannot, in and of itself, displace the application of the WSIA. Rather, one must consider the fundamental nature of the action and determine, regardless of its description, whether it arises in respect of the worker’s injuries and is therefore clearly barred by the application of the WSIA.


In fact, it's a general consensus at the Appeal Tribunal that the right to bring an action for wrongful dismissal has not been removed by the WSIA. See, for example, Decision 1319/01/2, 2004 ONWSIAT 2485 , and Decision No. 566/00, 2000 ONWSIAT 691.


This point is best illustrated by the Appeal Tribunal's Decision No. 237/03, 2003 ONWSIAT 459. WSIAT held in paragraph 68 that:


....In my view, in both the instant application and Decision No. 28/94, the wrongful dismissal action was “for or by reason of” an allegation of dismissal, constructive or otherwise, made in each case. In neither case was the action “for or by reason of an accident”. I agree with the findings in Decision No. 286/96 and Decision No. 670/97 that the “incidental” relationship between the facts underlying a worker’s personal injury by accident and those underlying an allegation of wrongful dismissal is not sufficient to support a determination that the action for wrongful dismissal should be taken away by the [WSIA].


5. Is A Constructive Dismissal Claim involving Work Related Stress Barred by WSIA?


Recall that you have to be fired to claim wrongful dismissal. If you, as an employee quit due to harassment, and try to claim constructive dismissal, however, it may or may not be statue bar. The “inextricably link” test will be use. The test is whether the ONLY claim of constructive dismissal was workplace harassment, or there’s more, such as breach of employment contract, repudiation, etc…


The best example to illustrate this principle is Decision No. 1227/19, 2019 ONWSIAT 2324 rendered by the WSIAT in October 2019 and referred to as the “Morningstar Decision”. Do note that the worker employee had applied for reconsideration to have the decision overruled, and such request was denied in Decision No. 1227/19R, 2020 ONWSIAT 1151.


a. The Morningstar Decision

Ms. Morningstar, was employed by Hospitality Fallsview Holdings Inc. (HFH), in its housekeeping department, from May 2015. In May 2016, she was promoted to the position of supervisor. Ms. Morningstar resigned her position with HFH in February 2018 claiming constructive dismissal as a result of harassment and bullying in the workplace. Ms. Morningstar claimed that housekeeping employees subjected her to abusive, humiliating and cruel conduct over the course of 17 months and that this conduct was supported and reinforced by HFH’s management.


She filed a Statement of Claim in the Ontario Superior Court of Justice on April 2, 2018 claiming damages for constructive dismissal, bullying, harassment and/or a poisoned work environment pursuant to the Occupational Health and Safety Act (OHSA), the tort of harassment, as well as punitive, aggravated and/or moral damages.


HFH applied to the WSIAT to determine whether the plaintiff's right of action was taken away pursuant to Section 13, 26 and 31 of the WSIA.


The Workplace Safety and Insurance Appeals Tribunal (WSIAT) held in paragraph 30 of Decision No. 1227/19 that:


....[Ms. Morningstar]’s action against [HFH] is not for wrongful dismissal in the usual sense, but rather is for constructive dismissal, meaning her employment was effectively terminated by the harassing and bullying conduct of co-workers and management which caused her mental distress to such a degree that she was forced to take sick leave and ultimately to resign. I find that these facts, if proven, are inextricably linked to a claim for injury governed by the terms of section 13(4) of the WSIA....I find that the worker’s Statement of Claim is, in essence, a claim for injury resulting from alleged workplace harassment and bullying and thus is within the scope of section 13(4) ... to provide for entitlement for chronic mental stress arising out of, and in the course of, the [Ms. Morningstar]’s employment. Moreover, I find that the other remedies sought by the [Ms. Morningstar] are also claimed on the same facts, of harassment and bullying in the workplace. Accordingly, I find the worker’s right of action is taken away by the WSIA, pursuant to section 26 in this case.


As you can see. Ms. Morningstar quit in February, 2018. The WSIAT decision was in October 2019. She appealed the decision for a reconsideration, which was denied in June 2020. The deadline to sue in WSIB for a workers' compensation claim had expired in or about August, 2018. The deadline to sue in HRTO for a claim of Human Rights violation had expired in or about February, 2019. So sadly, it seemed that Ms. Morningstar was statute barred of any recovery of damages for the workplace harassment and workplace discrimination that she had suffered while working at HFH.


b. The “Inextricably Link” Test

Section 26 of the WSIA bars a worker from pursuing a civil action arising out of a workplace injury where:

  1. the foundational facts for the causes of action are inextricably linked to workplace harassment; and

  2. the workplace harassment results in a mental stress injury that is compensated under the WSIA.

According to Decision No. 616/21, which was issued on May 28, 2021, based on statutory interpretation and the historical context for workers' compensation legislation, the WSIA does not bar claims that DO NOT seek damages in respect of a personal injury sustained as a result of a workplace accident, including constructive dismissal claims seeking damages for reasonable notice.

c. The Guiding Principle In a Dismissal Case


So the guiding principle in a dismissal case as to whether it's statute barred by the WSIA is that whether or not the case involves a situation that the worker's employment was effectively terminated by the harassing and bullying conduct of co-workers and management, which caused his or her mental distress to such a degree that he or she was forced to take sick leave and, ultimately, to resign. These facts, if proven, are inextricably linked to a claim for mental stress under s. 13(4) of the WSIA. Thus, the worker's right of action is taken away.


However, it seems that the “inextricably link” test will ONLY bar a dismissal case entirely pursuant to WSIA 1) if the worker quit or resign instead of being terminated wrongfully; and 2) that he or she is NOT making any claim of Human Rights violations.


6. Conclusion


As demonstrated by case law above, if you are a victim of harassment in the workplace and discrimination in the workplace, you have several options:


1) File a complaint to the Human Resource Department at work and hope for the best;

2) file a workers' compensation claim with the WSIB, while still employed by the Employer, or a claim with the Ministry of Labour Health and Safety (if it does not qualify as chronic or traumatic mental stress).

3) sue for wrongful dismissal after you have been fired;

4) sue for constructive dismissal if the employer has breached the employment contract on Non-mental stress related ground.


Going forward, it appears that a dismissal claim is more about form than substance.

It is highly technical and statutory, and you should hire an employment lawyer or have a employment lawyer consultation as soon as you experience work-related stress and are unsure what to do.

Call us now at 647-849-6582 or Contact Us Now if you have any questions or concerns in related to employment contract, or you want to book an appointment for a legal consultation.