| Name of case: New Brunswick (Human Rights Commission) v. Potash Corp. of Saskatchewan Inc.
Court appealed from and date of judgment: Judgment of the New Brunswick Court of Appeal dated July 20, 2006
Facts: The case arises from a complaint to the New Brunswick Human Rights Commission by miner Melrose Scott that being forced by his employer, Potash Corporation of Saskatchewan Inc., to retire on his 65th birthday on June 1, 2004 constituted discrimination on the basis of age contrary to the province's Human Rights Act.
Section 3(1) of the Act prohibits discrimination in employment on a number of grounds including age. Section 3(5) provides that discrimination that would otherwise by prohibited under s.3(1) "shall be permitted if such limitation, specification or preference is based upon a bona fide occupational qualification as determined by the Commission." Finally, s.3(6) provides that "[t]he provisions ... as to age do not apply to (a) the termination of employment or a refusal to employ because of the terms or conditions of any bona fide retirement or pension plan; (b) the operation of the terms or conditions of any bona fide retirement or pension plan that have the effect of a minimum service requirement."
Case History: The Human Rights Commission referred the complaint to a Board of Inquiry, which was asked to make a preliminary ruling on the following question: "What criteria must be met to make a finding that a pension plan is a bona fide [good faith] pension plan such [as] to satisfy the requirements of s.3(6)?" The Commission argued before this Board that the term "bona fide" should be interpreted in accordance with the test set out by the Supreme Court of Canada in British Columbia (Public Service Employee Relations Commission) v. BCGSEU, [1999] 3 S.C.R. 3, better known as the Meiorin decision. In Meiorin, the Supreme Court established that an employer can defend against an allegation of discrimination in employment by establishing that the impugned standard is a bona fide occupational qualification (BFOQ) This requires proof that the employer adopted the job requirement or standard for a purpose rationally connected to the performance of the job; that the job requirement was adopted in the honest and good faith belief that it was necessary to the fulfillment of the legitimate work-related purpose; and that it would be impossible to accommodate individual employees sharing the characteristics of the employee alleging discrimination without imposing undue hardship on the employer.
Potash Corporation, for its part, submitted that the applicable criteria were those established by the Supreme Court in Zurich Insurance Co. v. Ontario (Human Rights Commission), [1992] 2 S.C.R. 321, which dealt with alleged discrimination in setting automobile insurance premiums on the basis of the driver's age, sex and marital status. In that case, the Supreme Court held that since s.21 of the Ontario Human Rights Code exempts differentiation, distinction, exclusion or preference in contracts from anti-discrimination provisions if it is carried out on "reasonable and bona fide grounds," a discriminatory practice would be "reasonable" for this purpose if it were based on a sound and acceptable business practice and no practical alternative existed.
The Board of Inquiry accepted the Commission's interpretation, finding that Potash Corporation had to meet the Meiorin test, because Meiorin, like Scott's case, involved alleged discrimination in employment, while Zurich dealt with an insurance issue. Potash Corporation applied for judicial review, and the reviewing judge ruled that the Board had erred in applying the Meiorin test and that the Zurich test was the applicable standard. The Commission appealed to the New Brunswick Court of Appeal, and Potash cross-appealed, arguing that only the bona fide aspect of Zurich should be applied and it should not have to prove reasonableness.
In a July 20, 2006 decision, the New Brunswick Court of Appeal ruled that neither Meiorin nor Zurich had application in this case, because s.3(6) of the Act unconditionally exempted mandatory retirement requirements from the Act's anti-discrimination provisions if those requirements were part of a duly registered, and therefore bona fide, pension plan. Writing the majority decision of a three-member panel of the Court, Justice Joseph Robertson reasoned that s.3(6)(a) "states that s.3(1) does not apply in cases of forced retirement pursuant to the terms of a bona fide pension plan. It necessarily follows that if s.3(1) does not apply then neither can s.3(5). Hence, s.3(6)(a) has the effect of relieving employers of the obligation to justify their mandatory retirement policy as a BFOQ under s.3(5). This is true provided that the employer can establish that a mandatory retirement policy is pursuant to a bona fide pension plan. Yet, the interpretation that the Commission advances with respect to s.3(6)(a) would have us read in the BFOQ test as articulated in Meiorin, thereby defeating the very purpose for which s.3(6)(a) was added to the legislation."
Robertson concluded that the reasonableness test set out in Zurich was also inappropriate because "the Supreme Court went out of its way in Zurich Insurance to emphasize that differences exist between discrimination in the insurance and employment contexts", and because "if we were to read in the reasonableness test articulated in Zurich Insurance, we would be reintroducing a critical component of the BFOQ test articulated in Meiorin, thereby forcing the employer to justify why other practical alternatives to mandatory retirement were not considered or adopted."
On behalf of the Court of Appeal, Justice Robertson dismissed the Commission's appeal, allowed Potash Corporation's cross-appeal, and remitted the matter to the Board of Inquiry to deal with the complaint in accordance with the reasons for judgment. The Commission applied to the Supreme Court of Canada for leave to appeal.
Issue(s): (1) Whether the test developed in Zurich applied to the bona fide pension plan exemption found in s.3(6)(a) of the New Brunswick Human Rights Act; (2) whether the majority of the Court of Appeal, in adopting that test, failed to give the Human Rights Act a broad, purposive and remedial interpretation consistent with its dominant purpose of achieving equality, failed to interpret an exemption narrowly, rejected the test developed in Meiorin as applying to s.3(6), or failed to find that the Zurich test must be interpreted in light of Meiorin; (3) in the alternative, whether the majority of the Court of Appeal erred in finding that only the bona fide and not the "reasonable" part of the Zurich test applied; (4) whether s.3(6) complies with the Charter.
Status: Heard February 19, 2008. Judgment Reserved.
Lancaster Reference: For analysis of the New Brunswick Court of Appeal’s decision, see Lancaster’s Pension & Benefit Law E-Bulletin, November 10, 2006, Issue No. 46.
Court of Appeal decision: http://www.lancasterhouse.com/decisions/2006/july/NBCA-Potash.pdf |
