



COURT OF APPEAL FOR ONTARIO

CITATION: Ontario (Labour) v. Flex-N-Gate Canada
    Company, 2014 ONCA 53

DATE: 20140123

DOCKET: C52732

Laskin, Tulloch and Strathy JJ.A.

BETWEEN

Her Majesty the Queen in Right of Ontario
(Ministry of Labour)

Appellant

and

Flex-N-Gate Canada Company

Respondent

Gráinne McGrath and Jason Tam, for the appellant

Gino Morga, for the respondent

Heard:  June 27, 2013

On
    appeal from the order of Justice Micheline A. Rawlins of the Ontario Court of
    Justice, dated April 15, 2009, allowing the appeal in part from the sentence
    entered by Her Worship Justice of the Peace Maureen Ryan-Brode, dated July 6,
    2006.

Laskin J.A.:

A.

introduction

[1]

An
    employer 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 employers
    corrective action as a mitigating factor?  If the employer breaches more than
    one provision of the
Act
, does the court have jurisdiction to impose
    concurrent fines?

[2]

These
    two important questions came to this court with leave, following the sentencing
    of the respondent Flex-N-Gate for two breaches of the
Act
.  These two
    breaches led to an accident in which a worker badly injured her foot. 
    Flex-N-Gate was fined $50,000  $25,000 for each offence.  However, the appeal
    court judge ordered that the fines be paid concurrently  effectively reducing
    Flex-N-Gates obligation by half  to reward the company for its compliance. 
    The Crown was granted leave to appeal both on the question whether required
    compliance might be a mitigating factor on sentence, and on the question
    whether the court has jurisdiction to impose concurrent fines.

B.

background

(a)

The Accident: January 28, 2004

[3]

Flex-N-Gate
    produces automobile parts at its factory in Tecumseh, Ontario.  It processes
    metal sheets into vehicle bumpers.  When the accident occurred in January 2004,
    Flex-N-Gate had 500 employees; with the downturn in the automotive industry, by
    the time of trial in July 2006, Flex-N-Gates workforce was down to 250
    employees.

[4]

Two
    production lines process the metal sheets.  On each line are bundles, each containing
    120 to 170 sheets.  An entire bundle weighs between 5000 and 5200 pounds.  When
    the bundles are received from a supplier, they are held together by four bands.

[5]

To
    get the sheets to the production lines, a forklift operator retrieves the
    bundles from the storage area and places them in a cradle in the production
    area.  The accident occurred when the forklift operator was bringing a bundle
    of sheets to the production line.  He first placed the bundles on the floor
    near the cradle.  Then, the worker who was injured, Louisa Sarkisian, cut three
    of the bands, leaving only one band to secure the bundle.  At the time she was
    following the companys standard procedure.

[6]

Unfortunately,
    when the forklift operator tried to load the bundle into the cradle, the bundle
    slipped off the fork and fell to the factory floor.  The sheets scattered like
    a deck of cards across the floor.  One of the sheets struck Ms. Sarkisians
    foot.  She was taken to the hospital, and underwent surgery to repair several
    broken bones in her foot.  She was off work for 4 ½ months, and on crutches for
    two months.  She took physiotherapy for about a year, but she still has residual
    pain in her foot.


(b)

The Compliance Orders

[7]

A
    Ministry of Labour inspector investigated the accident and issued two orders
    for each of the two production lines.  The first order required Flex-N-Gate to
    comply with the regulatory provision for the safe movement of material.  The
    second order  a stop work order  prohibited Flex-N-Gate from using the
    equipment involved in the accident until it complied with the first order.

(c)

Flex-N-Gate Complies with the Orders

[8]

Flex-N-Gate
    immediately complied with the order for the safe movement of materials.  It introduced
    a new procedure for moving bundles of sheets.  This new procedure required that
    all four bands securing a bundle be kept in place until the bundle is in the
    cradle.  Once the bundle is in the cradle, a worker can cut and remove all four
    bands.  Significantly, there was no evidence that this corrective action taken
    by Flex-N-Gate went beyond what the compliance orders required.

(d)

The Trial Proceedings

[9]

After
    a three day trial before a Justice of the Peace in July 2006, Flex-N-Gate was
    convicted of two offences under the
Act
:  failing to ensure that
    material was moved in a manner that did not endanger the safety of a worker as prescribed
    by s. 45(a) of the Industrial Establishments Regulation 851/90, and contrary to
    s. 25(1)(c) of the
Act
;
[1]
and failing to provide information, instruction and supervision to protect the
    health and safety of workers, contrary to s. 25(2)(a) of the
Act.
[2]


[10]

The Justice of the
    Peace imposed a $50,000 fine on Flex-N-Gate, $25,000 for each offence.

[11]

In imposing this fine,
    the Justice of the Peace noted that the maximum fine on a corporation for each
    of these offences was $500,000.  She also noted that Flex-N-Gate is a
    significant operation but not huge, and that this court is familiar with many
    graver workplace injuries.  She found expressly that this accident did not
    occur from wilful disregard of a known hazard and, finally, she acknowledged
    the steps taken by Flex-N-Gate to establish a safe working environment.

(e)

Appeal Proceedings

[12]

Flex-N-Gate appealed
    both its convictions and its sentence to the Ontario Court of Justice.  On
    April 15, 2009, in brief reasons, the appeal court judge dismissed the
    conviction appeal, but allowed the sentence appeal.  She did not change the
    amount of the fine for each offence  $25,000  but she made the fines
    concurrent, meaning that Flex-N-Gate was required to pay only $25,000,
    instead of the $50,000 fine ordered by the Justice of the Peace.

[13]

In reducing the amount
    of the fine to be paid, the appeal court judge relied on the corrective action
    taken by Flex-N-Gate.  She said:

and I would find that general deterrence is the paramount
    consideration. But, little weight was given to the corrective action taken by
    the appellant.  The ameliorating action was taken prior to trial, even though
    it could have been construed as consciousness of guilt or wrong-doing.

For those reasons, because the same way we like to punish with
    respect to general deterrence we also, as courts are concerned, like to reward
    with respect to people doing what I consider to be the right thing, I will not
    interfere with the sum of $25,000 but I will make it concurrent on counts one
    and three.

(f)

The Motion for Leave to Appeal

[14]

The Crown sought leave
    to appeal under s. 131 of the
Provincial Offences Act
, R.S.O. 1990, c. P.33
.  In a short
    endorsement dated September 20, 2010, Armstrong J.A. granted leave to appeal on
    the two issues I referred to in the introduction:  (1) [t]he issue of mitigation
    after an order has been made by an inspector under the
Occupational Health
    and Safety Act
; and (2) the issue of concurrent fines under provincial
    legislation.


C.

ANALYSIS

First Issue:  Should the court treat Flex-N-Gates
    corrective action as a mitigating factor on sentence?

[15]

Once the Ministry
    inspector issued compliance and stop work orders, Flex-N-Gate had two choices:
    appeal the orders to the Ontario Labour Relations Board, or comply with them. 
    Failure to comply with an inspectors order is itself an offence under the
Act.
[3]

[16]

Flex-N-Gate did not
    appeal the orders.  It chose to comply with them.  It put in place a new
    procedure for the safe movement of bundles of sheets.  Its corrective action
    rectified the flaws in its existing procedures.

[17]

The Justice of the
    Peace gave no weight to Flex-N-Gates compliance with the inspectors orders. 
    The appeal court judge, however, considered Flex-N-Gates compliance to be a
    mitigating factor on sentence:  she held that Flex-N-Gate ought to be
    rewarded for doing the right thing.

[18]

The Crown submits that
    the appeal court judge erred in treating Flex-N-Gates compliance  which was
    required by the
Act
 to be a mitigating factor.  Flex-N-Gate submits
    that the appeal court judge was entitled to take Flex-N-Gates compliance into
    account in exercising her discretion to impose an appropriate fine.

[19]

I agree with the
    Crowns position. The court should not have discretion to treat an employers
    post-offence compliance, though statutorily required, as a mitigating factor on
    sentence.  Doing so would undermine one of the most important goals of the
OHSA
 accident prevention  and the statutes most important sentencing principle 
    deterrence.

[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 inspectors order
    reduces an employers incentive to take this action before an accident occurs.

[22]

Rewarding post-offence
    compliance with an inspectors 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
    courts 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 companys 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.

[28]

In my opinion, the
    appeal court judge erred because, in rewarding Flex-N-Gate for doing the right
    thing, she seemed to equate sentencing for the commission of a crime with
    sentencing for the commission of a regulatory offence.  However, the two
    contexts are quite different.  Criminal law is concerned with the moral blameworthiness
    of an accuseds conduct; regulatory law is concerned not with the defendants
    conduct but with the results of its conduct.

[29]

If, after having
    committed a crime, an offender does some laudable act that he or she is not
    statutorily required to do  in other words, does the right thing  a court may
    take that act into account in sentencing the offender.  The act may be seen as
    mitigating the offenders moral blameworthiness or as a step towards the offenders
    rehabilitation.

[30]

If, after having
    contravened a safety standard, an employer then acts to correct the problem, it
    is not doing the right thing; it is doing what the statute requires it to
    do.  It ought not to be rewarded for its compliance.

[31]

Accordingly, I would
    allow the Crowns appeal on this first issue and hold that an employers
    corrective action taken in response to an inspectors order is not a mitigating
    factor on sentence.

[32]

I would, however, add
    two points.  First, if an employer takes corrective action that goes beyond
    what was required by an inspectors order, then a court may take that
    additional action into account in sentencing the employer.  Rewarding
    remedial steps not required by an inspectors order would be consistent with
    the goal of accident prevention.

[33]

Second  and perhaps
    this is an obvious point  in sentencing an employer for breach of the
OHSA
,
    action taken to promote health and safety before an accident occurs should be
    treated differently from corrective action taken only in response to an
    inspectors order.  Action taken beforehand is an appropriate mitigating factor
    on sentence.  Treating it as one is consistent with the goal of accident
    prevention and with the principle of deterrence.

[34]

In this case, in
    November 2003, just months before the accident, Flex-N-Gate retained a health
    and safety consultant to do an independent audit of the companys health and
    safety program and compliance with
OHSA
standards.  The consultant
    reviewed Flex-N-Gates procedures, inspected its factory and then prepared a
    report, which listed safety concerns and recommended changes to some of the
    companys procedures.  Flex-N-Gate implemented the recommendations.  In
    sentencing Flex-N-Gate, the Justice of the Peace acknowledged, appropriately in
    my view, the steps taken by Flex-N-Gate to establish a safe working
    environment.

Second Issue:  Does the court have jurisdiction to impose
    concurrent fines?

[35]

The Justice of the
    Peace ordered Flex-N-Gate to pay a total fine of $50,000, $25,000 for each of
    the two offences.  The appeal court judge did not disturb the amount of each
    fine but made them concurrent, effectively reducing Flex-N-Gates obligation by
    half.  The second question on this appeal is whether the court has jurisdiction
    to impose concurrent fines for a contravention of the
OHSA
.  I
    conclude that it does not have jurisdiction.  I rest my conclusion on the case
    law that governs the imposition of fines in criminal proceedings.

[36]

The
OHSA
and
    the
Provincial Offences Act
are silent on the question.  So too is the
Criminal Code
.  However, our court has held that in proceedings under
    the
Code
, the court has no jurisdiction to impose concurrent fines. 
    It may impose concurrent custodial sentences for two or more counts, but if the
    sentence is a fine, it must impose separate fines for each count, but ensuring that
    the overall fine is appropriate.
[5]
Martin J.A. set out those principles in
R. v. Ward
(1980), 56 C.C.C.
    (2d) 15 (Ont. C.A.), at para. 9:

We observe, firstly that there is no authority to impose a
    concurrent fine as the learned trial judge did, in respect of separate
    offences:  see
R. v. Dedarin et al
., [1966] 1 C.C.C. 271.  Where it is
    appropriate to impose a fine, either in lieu of or in addition to, a custodial
    sentence, a separate fine must be imposed on each count in respect of which it
    is intended to impose a fine taking care, of course, that the total amount of
    the fines does not exceed what is appropriate.

[37]

I would apply these
    principles in
Ward
to proceedings under the
OHSA
.  I see no
    rational basis to do otherwise.

[38]

Accordingly, I would
    allow the appeal, set aside the appeal court judges order making the fines
    concurrent, and reinstate the total fine of $50,000 ordered by the Justice of
    the Peace.  That fine is fit.  It is consistent with the principles and case
    law for sentencing employers for breach of the
OHSA
.

D.

conclusion

[39]

Leave to appeal to
    this court was granted on two issues:  whether an employers compliance with an
    inspectors order after an
OHSA
offence has been committed should be a
    mitigating factor on sentence; and whether the court has jurisdiction to impose
    concurrent fines for breaches of the
Act
.

[40]

I would allow the
    Crowns appeal on both issues and reinstate the fines of $25,000 for each
    offence ordered by the Justice of the Peace.

[41]

First, the appeal
    court judge erred by rewarding Flex-N-Gate for simply complying with the
    inspectors orders.  Second, the appeal court judge had no jurisdiction to
    impose concurrent fines.

[42]

In oral argument, we
    were advised that Flex-N-Gate paid the $50,000 fine years ago, and that after
    the appeal court judges decision, received a $25,000 refund.  Assuming that to
    be so, I would not require Flex-N-Gate to repay $25,000 to the Crown.  The
    Crown took this appeal not because of the money in question, but because of the
    sentencing principles at stake.

Released: January 23, 2014 (JL)

John Laskin J.A.

I agree.  M. Tulloch J.A.

I agree.  G.R. Strathy J.A.





[1]
Section 25(1)(c) of the
OHSA
provides:  (1) An employer shall ensure
    that, (c) the measures and procedures prescribed are carried out in the
    workplace.



[2]
Section 25(2)(c) of the
OHSA
provides:  (2) Without limiting the
    strict duty imposed by subsection (1), an employer shall, (a) provide
    information, instruction and supervision to a worker to protect the health or
    safety of the worker.



[3]
Section 66(1) of the
OHSA
provides:  Every person who contravenes or
    fails to comply with(b) an order or requirement of an inspector or a Director
    is guilty of an offence



[4]

Ellis-Don
dealt with the constitutionality of the due diligence
    defence in s. 37 of the
OHSA
.  The majority of this court held that
    the section was unconstitutional because it was not justified under s. 1 of the
Charter
.  Carthy J.A. in dissent held that s. 37 was constitutional. 
    The Supreme Court of Canada allowed the Crowns appeal and also upheld the
    constitutionality of the section.  See
R. v. Ellis-Don Ltd.,
[1992] 1
    S.C.R. 840.



[5]
Under the
Code
, if sentences are intended to be consecutive, the court
    must so direct.  Otherwise, sentences will be treated as concurrent, since they
    begin when they are imposed.


