HUMAN RIGHTS TRIBUNAL OF ONTARIO
B E T W E E N:
Sheryl Abbey
Applicant
-and-
Her Majesty the Queen in Right of Ontario as represented by the Ministry of Community and Social Services
Respondent
DECISION
Adjudicators: Leslie Reaume and Dawn Kershaw
Indexed as: Abbey v. Ontario (Community and Social Services)
APPEARANCES
Sheryl Abbey, Applicant
Self-represented
Her Majesty the Queen in Right of Ontario as represented by the Ministry of Community and Social Services, Respondent
Mimi Singh, Counsel
Introduction
1This Application was filed under section 34 of Part IV of the Human Rights Code, R.S.O. 1990, c. H.19, as amended (the “Code”), alleging discrimination with respect to services because of disability.
2The applicant is terminally ill and living with the on-going, disabling effects of cancer, cancer treatment, diabetes and other health issues. She is eligible to receive income support, health benefits and employment supports under the Ontario Disability Support Program (“ODSP” and “ODSP services”).
3The respondent administers the ODSP, the purpose of which is to provide income support and health benefits to eligible recipients recognizing that the government shares in the responsibility to ensure the support of persons with disabilities. The ODSP provides employment supports which benefit those recipients who are interested in and capable of working. The ODSP also supports self-employment as a means of increasing financial independence.
4In the fall of 2013, while she was in receipt of ODSP, the applicant was preparing to start a business called “Cancer Connect”. The purpose of the business was to connect cancer patients and their families with services in the community. The business model evolved from the applicant’s own experiences as a cancer patient. Cancer Connect was designed to assist in connecting patients, caregivers and their families with, among other things, transportation, personal care, home care, medical and other professional services.
5The applicant envisioned that the services of Cancer Connect would be delivered by qualified subcontractors like Personal Support Workers (“PSW’s”) and drivers. The applicant’s role would be to develop a client base and coordinate the delivery of the subcontractors’ services to those clients. Cancer Connect would be supported in part by advertising revenues generated through the production of a seasonal glossy magazine called the “Cancer Connect Guide”. The advertising for the guide would also be subcontracted to sales people. The business was a sole proprietorship and every person the applicant envisioned working with would be a subcontractor.
6The applicant has a degree in psychology and a Master of Education degree in educational psychology and counselling. She has significant experience which is relevant to the business model she developed. The applicant’s disabilities prevent her from going out into the community to sell advertising or provide services directly to Cancer Connect clients. However, she is experienced and physically capable of playing the role of the coordinator, matching subcontractors with clients, developing the Cancer Connect Guide, and generally running the administrative side of the business. The business model she created gave her the flexibility to work and interact with others when she was well enough to do so.
7The applicant began her business preparations in September 2013 and ceased those preparations in early November 2013. On November 1, 2013, the applicant had a discussion with her ODSP caseworker and learned for the first time about rules which would have the effect of attributing income to her that was actually paid to her subcontractors, potentially putting her access to ODSP services in jeopardy.
The Issues
8This Application involves challenges to two policy directives under the ODSP.
9The first and primary challenge relates to the rules contained in policy directive 5.4 which apply to the calculation of self-employment income. The first rule appears in the list of approved business expenses:
Subcontracting: If a recipient requires the services of a skilled person to complete work (i.e. home renovations business needs a bricklayer) or a temporary unskilled worker, the recipient may contract with the individual for a specific job. There must be a written contract indicating the job to be completed, start and end date, amount the contractor will be paid and how the payments will be made.
Subcontracting should occur on an infrequent basis and should not involve ongoing contractual agreements. The recipient cannot hire a member of the benefit unit as a subcontractor.
The second appears in the list of non-approved business expenses:
Wages Paid to Members of the Benefit Unit or Other Employees: including payroll expenses (e.g. income tax, EI, CPP, Workplace Safety and Insurance Benefits) are not approved as business expenses even if the recipient deems these expenses as necessary. Note: This does not include payment made to an individual who is hired due to the disability related needs of the recipient.
10Together these rules have been interpreted to mean that ODSP would not deduct expenses paid to regular subcontractors from the applicant’s gross business income.
11The applicant anticipated that her income from the business would initially be modest and would not immediately affect her entitlement to ODSP income support or health benefits. As her business model evolved, the applicant came to believe that it had considerable potential and would, at some point, result in sufficient income for her to transition off ODSP. However, in a phone call with her caseworker the applicant learned that if she proceeded with her business, ODSP would calculate her income without deducting the expenses paid to her subcontractors. This would result in any money paid out to the subcontractors being imputed to the applicant for the purpose of determining her financial eligibility for income support and health benefits.
12The applicant ceased her business preparations shortly after this discussion with her caseworker. She was not aware of the subcontracting rules and had not anticipated this problem because she assumed that her income would be calculated by ODSP in largely the same way that it is calculated under the rules established by Canada Revenue Agency (“CRA”). However, once she learned about the rules, she closed her business because of the fear that the rules would have the effect of rendering her ineligible for the income support and health benefits she depends upon and would otherwise be entitled to.
13The applicant argues that the rules are not just unfair in the general sense, but also discriminatory. There is no dispute that the applicant is a person with a disability and qualifies for ODSP. The applicant argues that the rules have the potential to interfere with her access to the ODSP services she would otherwise be entitled to. She argues that the rules have not been justified by the respondent and in fact, are contrary to the purpose of the legislation and the policy of ODSP to reduce barriers to employment, including self-employment.
14The respondent argues that the rules against the retention of regular subcontractors and how expenses paid to them are treated by ODSP are not connected to the applicant’s disability. The respondent argues that the rules apply uniformly to all income support recipients. The legislation is not designed to support large and complex businesses, business growth strategies or the preferences of income support recipients who want to run a small business. The respondent argues that the applicant is free to run the business of her choice on the understanding that her eligibility for ODSP services may be affected by that choice. The respondent also argues that the applicant made a choice to cease her business preparations without fully informing herself of the risks of proceeding. The respondent argues that the applicant made assumptions about her access to ODSP services, particularly her health benefits, when in fact, ODSP provides transitional health benefits, extended health care and rapid reinstatement, all of which are designed to buffer the fear and risks associated with self-employment.
15The second challenge relates to the applicant’s request for the employment start-up benefit (“ESUB”), which is intended to assist ODSP recipients with basic start-up costs like business cards and office supplies. The maximum amount a recipient can claim in any 12-month period is $500.00. The applicant applied for the ESUB and was denied at first instance by her case worker. She filed an internal review of that decision which was denied by a separate caseworker. The explanation given to the applicant for both decisions was that she had not provided sufficient proof that her business was operating to be eligible for the benefit. The applicant disagrees with the correctness of these decisions and argues that she was disadvantaged by them.
16The respondent argues that there is no connection between the denial of the ESUB and the applicant’s disabilities and therefore no discrimination. The respondent argues that two different ODSP caseworkers came to independent conclusions that the applicant had not provided sufficient information to establish that she had started a business or had incurred expenses associated with the imminent start-up of a business.
17The applicant responds that apart from the minimal support provided through the ESUB, she is not seeking support for her business or access to ODSP employment supports generally. The applicant is seeking to have the subcontracting rules removed so that the income she earns from her business will not be artificially inflated in calculating her ongoing eligibility for ODSP services. The applicant argues that if even one of her subcontractors was successful, she would be rendered ineligible for ODSP services.
Decision
18With respect to the ESUB, we agree with the respondent that the applicant has failed to prove a connection between the denial of the ESUB and her disabilities. The applicant disagrees with the correctness of the two decisions denying the ESUB, but there is no proof that her disabilities were a factor in those decisions. As a result, we have dismissed this portion of the Application.
19With respect to the subcontracting rules in policy directive 5.4, which is the primary focus of the Application, we find that the applicant has proven that the rules would have the effect of imputing income to her which she did not earn. Depending on the extent of the expenses paid to subcontractors, this calculation would have the effect of interfering with her access to some, if not all, of her income support and other ODSP services she would otherwise be eligible for based on her disability, income and assets. She would have access to transitional and extended health care benefits; however, she would be required to access these supports prematurely. In addition, eligibility for extended health care benefits is based on a calculation of health costs versus excess income. This calculation would also be affected by the subcontracting rules.
20The respondent has not proven that there is a reasonable and bona fide justification for these rules, and therefore we have upheld this part of the Application. The subcontracting rules were carried over into the ODSP legislation in 1998 from the Family Benefits Act, R.S.O. 1990, c. F.2 (repealed Jan. 1, 2011) (“FBA”). The rules, which may have served a legitimate purpose under the FBA prior to 1998, are now irrational, unrelated to the purpose of ODSP and contrary to the goals of promoting employment, self-employment and financial independence. When viewed through the lens of substantive equality, these rules limit the aspirations of ODSP recipients who, like the applicant, are capable of starting a business and choosing how best to contribute to their own support.
Reasons
Prehearing Process
21The applicant filed this Application on November 19, 2013. However, she also filed three appeals with the Social Benefits Tribunal (“SBT”) in November, 2013. As a result, this Application was deferred by Interim Decision 2014 HRTO 495. The applicant then withdrew the SBT appeals, and the SBT confirmed this in letters, dated April 11, 2014. This Application was reactivated on May 5, 2014, and a summary hearing was scheduled, which took place on September 11, 2014. The Application was not dismissed, and it continued in the Tribunal’s process and ultimately was scheduled for hearing.
22This matter was heavily case managed out of necessity, and a series of Case Assessment Directions and Interim Decisions were made along the way, which included amending the Application, providing assistance with the hearing process and addressing many objections from the applicant with respect to case management and the anticipated hearing process. The hearing got underway in April 2015, continued in July 2015 and was completed in October 2015, when closing arguments took place.
Witnesses Evidence
23We have set out only the facts which are relevant to our decision, most of which were uncontested. We have indicated where the relevant facts are in dispute and what evidence each party has called to address that dispute.
24The Tribunal heard oral testimony from the applicant as well as Patrick Wyllie, Al Cordovado, Peter Zelinski and Lisa Flesher, all of whom were involved in the start-up of Cancer Connect. Their evidence goes primarily to remedy and is set out in that section of the decision.
25Three witnesses testified for the respondent. The first was Deborah Vella, who was the applicant’s case worker in the fall of 2013. Ms. Vella has worked with the respondent since 1998 and as a caseworker since 2010. Ms. Vella denied the request for ESUB at first instance and was involved in discussions with the applicant about the subcontracting rules. The second witness was Melanie Gutz, also a caseworker with ODSP, who denied the applicant’s request for internal review of Ms. Vella’s decision on the ESUB. The third witness was Gloria Lee, Acting Director of ODSP, who was not directly involved in the facts giving rise to the Application but testified for the purpose of explaining the origin and purpose of the subcontracting rules.
The Evidence Related to the Subcontracting Rules
The Applicant’s Evidence
26Between September and November 2013, the applicant made significant and comprehensive preparations for the launch of her business, all of which are set out in detail in the transcript of her evidence. She enlisted the help of Patrick Wyllie, Al Cordovado, and Lisa Flesher, who contributed their expertise in sales, marketing, transportation, health care and graphic design to the business plan. The applicant’s friend, Peter Zelinski, provided daily support, guidance and funding for initial start-up costs. The applicant was also meeting with people in anticipation of building a list of subcontractors to engage in selling advertising and providing services to Cancer Connect clients.
27The applicant testified that the business model aligned well with the physical restrictions she experienced as a result of her disabilities. She could work flexible hours from home without giving any indication to the people she was dealing with that she was not in perfect health on any given day. It also made use of her intellectual skills and her past work experiences.
28The applicant initially envisioned a relatively small business enterprise and anticipated that her income would not exceed $5,000.00 in her first year. However, the business model evolved rapidly over the course of a few weeks. The applicant and her supporters began to realize that Cancer Connect could turn into a large business venture with the possibility that the applicant could one day be fully self-supporting.
29The applicant’s plans changed dramatically as a result of a conversation with her caseworker on November 1, 2013. However, just before that, on October 29, 2013, the applicant discovered that she was suddenly unable to write anything. She sought medical treatment and, over the course of the next few weeks, she was investigated for the possibility of a stroke or heart issues.
30On November 1, 2013 the applicant received a call from her caseworker, Deborah Vella. The applicant’s version of the call is that Ms. Vella told her “she could not do what she was planning on doing”, namely, using subcontracted workers except on an occasional basis. Ms. Vella denied using those words but the parties agree that she told the applicant that ODSP would not deduct any expenses paid to subcontractors in calculating her income.
31The applicant testified, and this is a source of serious contention between the parties, that Ms. Vella “threatened” her that if she went ahead with her business plan an “erroneous overpayment” in the amount of what she paid to her subcontractors would be created against her. The applicant interpreted this to mean that if she paid out $100,000.00 to her subcontractors, she would end up with an overpayment to ODSP in the amount of $100,000.00, a debt which her estate would ultimately be responsible for paying. This interpretation is incorrect and we deal with this issue in greater detail below. No matter how much the applicant’s subcontractors earned, an overpayment could never exceed what was actually paid out to the applicant in income support.
32While the applicant called this a “threat”, she also made a point of saying during her testimony that the workers at ODSP, including Ms. Vella, were nothing but professional toward her.
33There was an exchange between the applicant and Ms. Vella about the difference between the ODSP rules and CRA. In our view, nothing turns on this, except perhaps the fact that it was not unreasonable for the applicant to begin her business preparations by anticipating that expenses paid to her subcontractors would be considered legitimate business expenses by ODSP.
34The applicant also disputes Ms. Vella’s testimony that she offered to copy policy directive 5.4 and send it to her. In any event, the applicant testified that following the call she immediately looked up the legislation, regulations, and policy directive 5.4 in particular.
35Both the applicant and Ms. Vella created notes at the time of the November 1, 2013 conversation. The applicant testified that she generally takes notes because of the effects of chemotherapy on her memory. However, the applicant did not produce the original notes she took of this conversation. During her testimony she read from notes which she typed the day before the hearing, using the original hand written notes as her guide. When she was asked whether she kept the hand written notes she had made at the time of the call she answered “probably not”. She indicated that she had probably shredded the original notes.
36The applicant testified that because her business model relied entirely on subcontractors, the rules would have resulted in the premature loss of her ODSP services in addition to a substantial overpayment.
37The applicant did continue with her business preparations for a couple of days following the call. On November 2, 2013, a training session took place for prospective outside sales representatives. On November 3, 2013, several people went out canvassing for advertising sales. Patrick Wyllie sold an advertisement in the Cancer Connect guide that day in the amount of $1,500.00.
38On November 4, 2013, the applicant wrote to the person who had been assisting her from the Small Business Center asking for advice about her discussion with Ms. Vella. The applicant testified that she was told that she should close her business bank account. She also wrote letters to every member of the Ontario legislature about her predicament.
39The applicant told Patrick Wyllie and Al Cordovado about the overpayment issue and the potential loss of her ODSP services. The applicant wanted to continue the business but her supporters decided to abandon their work on Cancer Connect out of concern for the applicant. The other sales representatives were told to stop canvassing clients and Ms. Flesher was asked to stop work on the Cancer Connect guide. The applicant ceased all of her business preparations and she advised Ms. Vella that she was becoming ill from the stress of dealing with this issue.
40Patrick Wyllie and Al Cordovado testified about the overpayment and the potential loss of ODSP services; however, their understanding about the potential effect of the subcontracting rules was based entirely on what they were told by the applicant.
41On or about November 25, 2013, the applicant spoke again with Ms. Vella and with Mr. Gauthier at ODSP, both of whom confirmed that nothing had changed and that her business income would be calculated without the benefit of a deduction for expenses paid to her subcontractors. The applicant testified that at this stage she did not consider any options other than shutting her business down.
42The applicant testified that she found it demoralizing that she could be a subcontractor for Cancer Connect, providing driving, house cleaning or personal care services, but not the owner of the business. She explained that as a subcontractor, her ongoing entitlement to ODSP services would be calculated on the basis of the actual income available to pay her living expenses. However, as the owner of the business, her income would be calculated in a way which could render her ineligible for ODSP services when in fact, she lacked the real income to support herself. The applicant testified that she simply could not afford to take this risk.
The Respondent’s Evidence
43Ms. Vella testified about her relatively brief discussions with the applicant about the subcontracting rules. Gloria Lee, Director of ODSP, who was not directly involved in the applicant’s allegations, testified in support of the respondent’s argument that the rules are not discriminatory. She provided an overview of the legislation, regulations and policy directives in order to situate the subcontracting rules in the proper context. There were many exchanges between these witnesses and the applicant during testimony. We have set out only the evidence which was relevant to our decision.
44Ms. Vella’s first involvement in the subcontracting issue occurred during her call with the applicant on November 1, 2013. She testified with the assistance of her notes which were entered into the respondent’s online, locked case management system at the time of the discussions with the applicant. Ms. Vella denied threatening the applicant and testified that she never used the word “erroneous” to describe a potential overpayment. She testified that she told the applicant that there might be a problem with her plan to use subcontractors because payments made to them would not be deducted from her business income. Ms. Vella also recalled receiving a call from the applicant on November 4, 2013, advising her that she was becoming ill from the news she had received on November 1, 2013. She also recalled advising the applicant that the directives could not be changed or appealed to the Social Benefits Tribunal.
45Ms. Vella denied ever threatening the applicant. She did discuss the possibility of an overpayment and she attempted to explain to the applicant that her business income would be reviewed every 12 months. She denied telling the applicant that an overpayment would be created in the amount of the expenses paid to her subcontractors and that the applicant’s estate would be responsible for the debt. Ms. Vella testified that she was providing information to the applicant so that she would be aware of the rules. She also denied ever telling the applicant that she would have to close her business.
46Gloria Lee has held the position of Director of ODSP since December 17, 2014. Prior to this she was the Manager of the Policy Research and Analysis Branch for the respondent. Ms. Lee testified that she is responsible for ensuring that the program meets legislative and program objectives. The following evidence arises from both Ms. Lee’s oral testimony and her affidavit sworn on June 15, 2015, which was adopted as part of her sworn testimony at the hearing.
47Ms. Lee testified that the ODSP provides employment supports to encourage employment and financial independence where that is possible. She stated that the program recognizes that persons with disabilities are different from one another and require a variety of different kinds of employment supports. The underlying policy rationale for the employment supports is that to the extent that people are willing and able, they are better off working. There are a wide variety of employment supports set out in various policy directives.
48Ms. Lee testified that the policy regarding allowable business deductions and the treatment of employee wages was carried over largely unchanged from the predecessor program under the FBA.
49There are a number of rules which support self-employment. For example, income from a business can be estimated and reconciled after the first year to provide protection against fluctuations in monthly earnings and to address the concern that starting a business could result in loss of income support without any certainty of business earnings. Some ODSP rules are more favourable than CRA rules such as the deduction for childcare expenses and the basic deduction of $100 per month, which is meant to cover miscellaneous expenses relating to the operation of the business. Ms. Lee also commented at length on the availability of extended and transitional health benefits and rapid reinstatement to the program. The purpose of these supports is to ease some of the fear associated with starting employment, including self-employment enterprises. Ms. Lee testified that they contribute to removing barriers to employment and self-employment, provide financial incentive for people who choose to pursue employment and encourage financial independence.
50The respondent’s position is that the subcontracting rules exist because ODSP is not designed to support large and complex businesses. This rationale is not set out in the act, regulations or policy directives. There is also no formula for determining what constitutes a large and complex business. However, Ms. Lee testified that when one considers the overall context of the legislation and the spirit and intent of the policies, it can be inferred that the subcontracting rules reflect the fact that the program does not support large and complex businesses.
51Ms. Lee testified that a recipient is eligible for ODSP because she has a medical condition which creates substantial impairments and affects her ability to care for herself personally, participate in the community or maintain employment. Ms. Lee testified that less than eight percent of ODSP recipients have earnings and that it would be very unusual for a recipient to want to hire multiple employees or be able to carry on a large and complex business. When recipients pursue self-employment the work typically takes the form of something that can be done from home with flexible hours. It is considered a “huge accomplishment” if recipients are able to work three to 10 hours per week. Ms. Lee emphasized the importance of flexible self-employment options and the ability to make connections and be included in the broader community. She cited jewellery making, lawn cutting, babysitting and snow removal as typical self-employment enterprises engaged in by ODSP recipients.
52Ms. Lee testified that when other provisions in the legislation and policies are considered they all point to support for relatively modest business enterprises: the automatic deduction of $100.00 per month whether a recipient generates income or not; the money paid to community services providers which is based on very modest income milestones achieved by recipients; modest business asset limits; and deductions for entertainment, gifts, hotels, meals, conventions, conferences and long distance travel expenses, which might be associated with larger or more complex businesses or used to grow and expand a business, are not allowed under the ODSP.
53When Ms. Lee was asked whether she considers Ms. Abbey’s business model to be a large and complex business, she answered affirmatively based on her understanding from discussions with staff that the applicant was looking to hire 32 employees as well as generate significant income. The applicant did not intend to hire employees when she started Cancer Connect but acknowledged that she hoped to keep expanding the number of subcontractors as demand for Cancer Connect services increased.
54Ms. Lee was asked by the applicant in cross-examination whether hiring one subcontractor could potentially put her ODSP services in jeopardy. Ms. Lee did not answer the question directly but instead responded that even a business with one employee could be considered a large and complex business if it generated significant profit.
55Ms. Lee testified that all of the directives are meant to be complementary and work within one cohesive framework with the intention of supporting people in their efforts to become employed where that is possible. She testified that this does not mean that a person will be fully economically independent overnight, but the program recognizes that there are things that can be done to support people as they make incremental steps towards financial independence and inclusion in their communities. Ms. Lee testified that the list of approved and non-approved business expenses are those which are typical for self-employment businesses, other than large and complex businesses, and that they have been in place a long time, going back to the FBA.
56Ms. Lee was asked, given the potentially small number of people in the applicant’s circumstances, why there was a blanket rule related to subcontracting rather than an individual assessment process. She testified that she did not know the answer to that question but was not sure how that could be administered. How would they determine, for example, which earnings to exempt and which earnings not to exempt? Similarly, when she was asked about the implications to the program of removing the subcontracting rules, Ms. Lee acknowledged that she did not know what the impact would be. Earlier in her testimony Ms. Lee speculated that allowing employee wages as approved business expenses for the purposes of deductions from gross business income could make ODSP more of a support or growth mechanism for business enterprises, than a means of generating income for recipients.
57Ms. Lee testified that accountability is an important part of the program. Over time, some policies change depending on government direction but they remain in line with an income- and asset-tested program, or a program of last resort. ODSP must strike a balance between accountability and providing incentives and the supports to help people move toward financial independence. Ms. Lee testified that the program is not in place to fund people “to operate or to earn large, exorbitant amounts of income while also remaining eligible for disability”.
The Evidence Related to ESUB
58The applicant was eligible for the ESUB benefit which provides up to $500 in any 12-month period to assist with costs related to starting or changing employment. She applied for ESUB and was denied and sought internal review of that decision. The internal review upheld the decision to deny ESUB. Those decisions were based on the opinion of Ms. Vella and Ms. Gutz that the applicant had not provided sufficient verification that her business was operating.
59The evidence related to the ESUB is relatively straightforward. We have set out the basic chronology below:
On September 23, 2013, the applicant sent a written request for ESUB to Ms. Vella. Ms. Abbey acknowledged that the letter did not explicitly indicate that she had started her business.
On October 4, 2013, Ms. Vella advised the applicant by letter that she had not been approved for ESUB because further information about her business plan was required to confirm that the business was operating.
On October 8, 2013, the applicant requested an internal review of Ms. Vella’s decision. In that letter the applicant advised ODSP that her business “is being created” and that the ESUB would be beneficial to her.
On October 17, 2013, the applicant’s internal review was denied by Melanie Gutz and the original decision upheld on the basis that there was insufficient evidence to establish that the business had started.
The applicant then filed an appeal of these decisions with the Social Benefits Tribunal, which was subsequently withdrawn.
60Ms. Vella testified that when she received the request for ESUB she was not satisfied that the applicant had provided sufficient information that she had started her business or that she had incurred expenses associated with the imminent start-up of the business. Ms. Gutz testified that she came to the same conclusion on the internal review.
Legal Principles
The ODSPA, Regulations and Policy Directives
61Prior to 1998, persons with disabilities who were eligible for income support received it through the FBA. It was a time when income support was highly stigmatized and often referred to as “welfare”. Persons with disabilities were removed from the welfare system in 1998 when the FBA was replaced by the Ontario Works Act, 1997, S.O. 1997, c. 25, Sched. A (“OWA”), and the Ontario Disability Support Program Act, 1997, S.O. 1997, c. 25, Sched. B (“ODSPA”).
62The purpose of the ODSPA is to establish a program which:
a. provides income and employment supports to eligible persons with disabilities;
b. recognizes that government, communities, families and individuals share responsibility for providing such supports;
c. effectively serves persons with disabilities who need assistance; and
d. is accountable to the taxpayers of Ontario.
63The OWA, by contrast, is premised on individual responsibility, promoting self-reliance through employment and providing temporary financial assistance to those in most need while they satisfy obligations to become and stay employed. No such obligation to become and stay employed exists under the ODSPA. The ODSPA and the OWA are meant to serve different goals, as was observed by the Supreme Court of Canada in Tranchemontagne v. Ontario (Director, Disability Support Program), 2006 SCC 14 at paragraph 3:
The divergent purposes of these two statutes was alluded to by the Honourable Janet Ecker, the Ontario Minister of Community and Social Services, on the day after the ODSPA was proclaimed:
This new program removes people with disabilities from the welfare system, where they should never have been in the first place, and it creates for them an entirely separate system of income support. … (citing the Legislative Assembly of Ontario, Official Report of Debates, No. 19A, June 2, 1998, at p. 971)
64The rules at issue in this case, which we have reviewed above, are not contained in the ODSPA or the regulations. They appear exclusively in policy directive 5.4, the most recent version of which is dated November, 2010. The stated intent of policy directive 5.4 is “to support self-employment as a means of increasing financial independence.”
65The intersection of rules which leads to the conclusion that ODSP would not permit a deduction from the applicant’s income for expenses paid to her subcontractors is somewhat confusing. There is no rule which explicitly precludes the deduction of expenses paid to subcontractors. It is the combined effect of two rules which leads to that result.
66The first rule appears in the list of “approved business expenses.” It states that subcontracting should occur on an infrequent basis and should not involve ongoing contractual agreements.
67The second rule appears in the list of “non-approved business expenses”. It explicitly precludes the deduction of “wages paid to members of the benefit unit or other employees”. Both Ms. Vella and Ms. Lee relied on the combination of these two rules to confirm that any expenses paid to the applicant’s subcontractors would not be deducted from her gross business income.
68The rule against deducting wages paid to members of the benefit unit or other employees was imported into the ODSPA from the FBA. When the FBA was still in force, the explanation for that provision was that the intention of the program was to provide income maintenance to persons in long-term financial need and not to be a support to business enterprises (Policy and Procedural Guideline 0303-09 Net Income from a Business, June 1, 1997). This rationale was not imported into policy directive 5.4.
69The policy directives published by the ODSP contain a preamble which explains how directives incorporate and advance the purposes of the ODSPA. The most recent version of that document is dated January 2003. Given the fact that it is a portion of a policy directive which is central to our determination of these issues, we have set out the preamble to the income support directives below (with the exception of the parts of the preamble which quote directly from the ODSPA):
The Ontario Disability Support Program (ODSP) was created to meet the unique needs of people with disabilities. The program provides income support including health and other benefits for people with disabilities in financial need. The program also provides employment supports to help people with disabilities prepare for, obtain or maintain a job. The intent of the program is to provide the supports necessary to enable individuals and families to live as independently as possible in the community and lead more productive, dignified lives.
The Ontario Disability Support Program Act 1997 and the regulations provide the legislative framework for realizing a separate system of income and employment supports for people with disabilities.
Policy directives provide the interpretation and application of legislative and policy requirements of the program. The policy directives will guide provincial staff in the delivery of the Ontario Disability Support Program. New policy directives will be issued as regulations and policies change.
The purpose of the policy directives is to enable consistent decision-making across the province and to ensure accountability for those decisions. The policy directives provide staff with the guidance they need to make decisions regarding the client's entitlement to services, supports and benefits. The ODSP legislation and policies allow for discretion in many areas. In keeping with the spirit of the legislation, staff should use this discretion to ensure that clients receive all of the benefits to which they are entitled. In accordance with its purpose of providing income support to persons with disabilities; the ODSP Act, regulations and policies should be interpreted flexibly and broadly.
ODSP services will be provided based on the client's individual needs and circumstances. Consistent with the intent of the Ontarians with Disabilities Act 2001, barriers to accessing ODSP must be removed or minimized so that all clients are able to benefit from the services available. Clients should be provided with the accommodations required to address disability-related needs. Such accommodations may include: using alternative communication formats; allowing flexibility of timelines; and human supports, such as sign language interpreters. Staff will provide clients with clear and up-to-date information about ODSP, as well as other community services available, in order to assist people with disabilities to live, work and participate in their communities.
70Some parts of policy directive 5.4 are clearly drawn from Regulation 222, O. Reg. 222/98 made under the ODSPA (“regulation”), which contains a series of deductions or exemptions from gross business income. However, policy directive 5.4 does not contain all of the deductions set out in the regulation. At the same time, the regulation does not contain many of the approved and non-approved deductions relating to the calculation of self-employment income in policy directive 5.4.
71There are a number of other non-approved business expenses contained in policy directive 5.4, including:
personal draws taken from the business;
business losses, which are treated as equivalent to a net income of $0.00;
depreciation on business assets and vehicles;
entertainment and gifts;
long distance travel expenses unless the recipient can demonstrate that he/she has earned income as a result of the travel;
hotels and meals;
conventions, conferences or similar events including travel, hotels and meals related to these events.
72There is also an exception to the subcontracting rules for limited forms of disability accommodation:
Disability Accommodation Expenses: In addition to the earnings deduction of $300 for disability-related expenses, a recipient may be allowed to deduct payments made to an employee who is required due to disability-related needs and in order to operate the business. For example, a piano tuner with a visual impairment requires a driver to take him/her to various locations where they could tune a piano. In this instance, the salary paid to the driver would be deducted as a necessary business expense.
73The applicant’s claim does not relate to this provision. She is not seeking to be accommodated within the subcontracting rules or to have the provision expanded to address her personal circumstances. She is seeking to have the subcontracting rules removed entirely.
Human Rights Legal Principles
74The Code protects against discrimination with respect to services on the basis of disability in section 1. In this case there is no dispute that the applicant is a person with a disability within the meaning of the Code. There is similarly no dispute that ODSP provides services in the form of income support, health benefits and employment supports.
75It is well established that human rights legislation is to be given a broad, liberal and purposive interpretation. In addition to a number of specific provisions related to discrimination, the Code contains a preamble which reflects the kinds of experiences the legislation is directed at remedying. It speaks not just to equality in relation to the law, but also to the values of understanding, mutual respect and dignity and the necessity to ensure that every citizen has the opportunity to contribute fully to the community. The analysis of a claim of discrimination under the Code must be animated by these important principles.
76The goal of human rights legislation is to achieve substantive, not formal, equality. In Kahkewistahaw First Nation v. Taypotat, 2015 SCC 30 at paragraph 17, the Supreme Court described substantive equality as an approach
(…) which recognizes that persistent systemic disadvantages have operated to limit the opportunities available to members of certain groups in society and seeks to prevent conduct that perpetuates those disadvantages.
77In R. v. Kapp, 2008 SCC 41, the Supreme Court cited Andrews v. Law Society of British Columbia, 1989 CanLII 2 (SCC) (“Andrews”), as having “set the template for this Court’s commitment to substantive equality – a template which subsequent decisions have enriched but never abandoned” (paragraph 14). At paragraph 15, the Court went on to describe the distinction between substantive and formal equality derived from Andrews:
Substantive equality, as contrasted with formal equality, is grounded in the idea that: “The promotion of equality entails the promotion of a society in which all are secure in the knowledge that they are recognized at law as human beings equally deserving of concern, respect and consideration”: Andrews, at p. 171, per McIntyre J., for the majority on the s. 15 issue. Pointing out that the concept of equality does not necessarily mean identical treatment and that the formal “like treatment” model of discrimination may in fact produce inequality.
78In Withler v. Canada (Attorney General), 2011 SCC 12, the Supreme Court found, at paragraph 39, that a substantive equality analysis “insists on going behind the façade of similarities and differences”:
Substantive equality, unlike formal equality, rejects the mere presence or absence of difference as an answer to differential treatment. It insists on going behind the facade of similarities and differences. It asks not only what characteristics the different treatment is predicated upon, but also whether those characteristics are relevant considerations under the circumstances. The focus of the inquiry is on the actual impact of the impugned law, taking full account of social, political, economic and historical factors concerning the group. The result may be to reveal differential treatment as discriminatory because of prejudicial impact or negative stereotyping. Or it may reveal that differential treatment is required in order to ameliorate the actual situation of the claimant group.
79In considering the role of comparison in the Court’s section 15.1 jurisprudence, the Court in Withler stated at paragraph 54:
In summary, the theme underlying virtually all of this Court’s s. 15 decisions is that the Court in the final analysis must ask whether, having regard to all relevant contextual factors, including the nature and purpose of the impugned legislation in relation to the claimant’s situation, the impugned distinction discriminates by perpetuating the group’s disadvantage or by stereotyping the group.
80Discrimination is not defined in the Code. In Andrews, above, at page 23, the Supreme Court considered statutory human rights instruments like the Code in considering how to define discrimination under the Charter:
I would say then that discrimination may be described as a distinction, whether intentional or not but based on grounds relating to personal characteristics of the individual or group, which has the effect of imposing burdens, obligations, or disadvantages on such individual or group not imposed upon others, or which withholds or limits access to opportunities, benefits, and advantages available to other members of society. Distinctions based on personal characteristics attributed to an individual solely on the basis of association with a group will rarely escape the charge of discrimination, while those based on an individual's merits and capacities will rarely be so classed.
81Substantive equality also recognizes that not every experience of adverse treatment will be discriminatory. In McGill University Health Centre (Montreal General Hospital) v. Syndicat des employés de l'Hôpital général de Montréal, 2007 SCC 4, at paragraph 49, Justice Abella stated that it is the “…link between that group membership and the arbitrariness of the disadvantaging criterion or conduct, either on its face or in its impact, that triggers the possibility of a remedy.”
82The necessity to prove this link between the adverse treatment and the prohibited ground has been repeatedly reinforced by this Tribunal and the Courts. See: Pieters v. Peel Law Association, 2013 ONCA 396 at paras. 59-60; Québec (Commission des droits de la personne et des droits de la jeunesse) v. Bombardier Inc. (Bombardier Aerospace Training Center), 2015 SCC 39 at paras. 45-52. There is no requirement to prove a causal connection, an intent to discriminate, or that the prohibited ground was the sole factor in the treatment experienced.
83To summarize the applicant’s burden, she must prove, on the balance of probabilities, that she has a disability (which is not contested); was disadvantaged in some way with respect to the services provided by ODSP; and that her disability was a factor in the disadvantage she experienced. Where the applicant proves these three elements and the respondent is unable to prove a reasonable and bona fide justification for the rules or conduct in question, discrimination will be found to have occurred. See Moore v. British Columbia (Education), 2012 SCC 61.
84The respondent seeks dismissal of this Application on the basis that the applicant is unable to prove these three elements with respect to the subcontracting rules and the denial of ESUB. As a result, the respondent did not make submissions on the legal principles associated with a reasonable and bona fide justification. We agree that, with respect to the ESUB, the respondent is not required to defend its decisions because the applicant is unable to demonstrate a link between her disabilities and the denial of that benefit. However, we disagree with respect to the subcontracting rules. As a result, we have set out the legal principles which govern the analysis of the respondent’s defence.
85This is a case where the subcontracting rules are not necessarily discriminatory on their face but rather in their effect, as a result of how they have been interpreted and applied to the applicant’s circumstances.
86Section 11 of the Code provides the respondent with a defence in cases of constructive or adverse impact discrimination:
11(1) A right of a person under Part I is infringed where a requirement, qualification or factor exists that is not discrimination on a prohibited ground but that results in the exclusion, restriction or preference of a group of persons who are identified by a prohibited ground of discrimination and of whom the person is a member, except where,
(a) the requirement, qualification or factor is reasonable and bona fide in the circumstances; or
(b) it is declared in this Act, other than in section 17, that to discriminate because of such ground is not an infringement of a right.
(2) The Tribunal or a court shall not find that a requirement, qualification or factor is reasonable and bona fide in the circumstances unless it is satisfied that the needs of the group of which the person is a member cannot be accommodated without undue hardship on the person responsible for accommodating those needs, considering the cost, outside sources of funding, if any, and health and safety requirements, if any.
87Reasonable and bona fide justification and undue hardship were defined by the Supreme Court in British Columbia (Public Service Employee Relations Commission) v. BCGEU, 1999 CanLII 652 (SCC) (“Meiorin”). In that case, the Supreme Court set out a three-part test for proving a reasonable and bona fide justification: a rational connection between the impugned rule and the purpose it is supposed to serve; an honest and good faith belief in the necessity of the rule; and proof that the rule is reasonably necessary in the sense that accommodation is impossible without imposing undue hardship.
88Shortly after Meiorin, the Supreme Court released its decision in British Columbia (Superintendent of Motor Vehicles) v. British Columbia (Council of Human Rights), 1999 CanLII 646 (SCC) (“Grismer”), which applied the test in Meiorin to a public service provider. In Grismer, the applicant had a visual impairment as a result of a particular medical condition. There was an absolute prohibition on issuing licenses to individuals with the applicant’s medical condition. As a result, his license was suspended without any individual assessment of his vision or driving abilities.
89The Court in Grismer found that as a precursor to answering the three questions in Meiorin – rational connection, good faith belief and reasonable necessity – a respondent must define the purpose and goal of the impugned rule with some precision. At para. 25 the Court stated that:
The Superintendent’s goal in this case was to maintain highway safety. But what kind of safety? What degree of risk would be tolerated? Where did the Superintendent draw the line between the need to maintain highway safety and the desirability of permitting a broad range of people to drive? The possibilities range from absolute safety, in which case few if any mortals would be allowed to drive, to a total lack of concern for safety, in which case everyone, regardless of their lack of ability, would be allowed to drive. Between these two extremes lies the more moderate view that reasonable safety suffices. The question is: where on this spectrum did the Superintendent set the bar?
90In Council of Canadians with Disabilities v. VIA Rail Canada Inc., 2007 SCC 15, the Supreme Court commented on what tribunals should consider in determining whether the respondent has established a reasonable and bona fide justification, at para. 187:
Meiorin counsels tribunals to consider a respondent’s efforts to investigate alternative, less discriminatory approaches demonstrating that no other reasonable or practical means of avoiding negative impacts on a claimant was possible in the circumstances.
91The Court of Appeal has confirmed that the Meiorin test applies to the defences under sections 11 and 17 of the Code. Entrop v. Imperial Oil Limited, 2000 CanLII 16800 (ON CA).
92In this case the respondent must first establish a purpose against which the elements of the three-part test can be measured. It is the purpose of the subcontracting rules which is at issue, not the purpose of the whole of policy directive 5.4 or the ODSP legislation itself. Once the purpose is defined with some precision, the respondent must prove that:
the rules were adopted for that purpose;
the rules were adopted in good faith, in the belief that they were necessary for that purpose;
the rules are reasonably necessary to accomplish the purpose, in the sense that the respondent cannot accommodate the applicant without incurring undue hardship.
93In answering these questions the respondent would be expected to demonstrate the origin and purpose of the subcontracting rules in policy directive 5.4, how and why they were adopted, why they are interpreted so as to preclude deductions for all expenses paid to subcontractors rather than determined on the basis of individual assessment, and whether they have been evaluated over time to ensure that they are still relevant and reasonably necessary to accomplish the purpose for which they were originally adopted.
94The respondent also raised the exemption contained in section 14 of the Code. That issue is dealt with at the conclusion of the Analysis section below.
Analysis
The Applicant’s Burden
Service
95How does the applicant tie her circumstances to the social area of services under the Code? The applicant is alleging that the subcontracting rules would have the effect of interfering with her entitlement to ODSP services. Her income would be artificially inflated as a result of the failure of ODSP to deduct real expenses paid out to subcontractors from her gross business income. The applicant takes no issue with the proposition that if her business was successful, her income would eventually render her ineligible for ODSP services. The applicant alleges that if she continued her business, the rules would have the effect of interfering with or presenting a barrier to her ongoing eligibility for the income support, health benefits, and employment supports, which she would otherwise be entitled to.
96In that sense this case is unlike other challenges to government benefit programs where, for example, the nature of a person’s disability or disability-related needs are not recognized by the legislation. See for example: Ball v. Ontario (Community and Social Services), 2010 HRTO 360. In this case the applicant meets the eligibility requirements of the program. If she continued her business, the rules would have the effect of imputing income to the applicant which she actually paid out to other people. The applicant argues that the rules perpetuate her disadvantage as a person with a disability.
97The respondent led evidence about the various employment supports offered by ODSP and characterized the applicant as a person who was seeking support for a large and complex business. The applicant takes issue with this characterization. The applicant was not seeking support for her business. She was seeking to have her eligibility for ongoing ODSP services determined on the basis of her real income until such time as her income exceeded the thresholds set out in the legislation and regulations.
98The applicant is not restricted to proving that she was denied a service. We agree that her allegations fall within the broader statutory language “with respect to services”.
Identification with a Prohibited Ground
99It is not disputed by the parties that the applicant is a person with a disability and that she lives with the effects of cancer, cancer treatment and diabetes. There was no dispute that she was eligible for ODSP services as a result of her disabilities.
Adverse Treatment
100The respondent argues that the applicant cannot satisfy the second part of the burden because she did not actually experience adverse treatment. The applicant was never the subject of a decision by the Director with respect to her proposed reliance on subcontractors and the treatment of expenses paid to them and she never asked to be accommodated. As a result, there was no impact on her which is attributable to the application of rules.
101There is no dispute that if the applicant paid expenses to subcontractors those payments would not be deducted from the applicant’s gross business income and therefore would be attributed to her as income under policy directive 5.4. Ms. Vella testified that she would have no discretion to exercise with respect to that issue, which is precisely why she attempted to draw the existence of the rules to the applicant’s attention.
102There is no dispute that the applicant ceased preparations for Cancer Connect as soon as she learned about how the expenses paid to subcontractors would be treated by ODSP. The disadvantage is not in the fact that the applicant had to choose between self-employment and her access to services. This is a choice that she would welcome: it would mean that her self-employment was generating sufficient income to render her ineligible for ODSP services. The disadvantage is in having her income from self-employment artificially inflated, leaving her in the untenable position where she could lose her ODSP services without having the actual income and assets to replace those services.
103We do not agree that the applicant cannot establish adverse treatment unless she continued her business and awaited the inevitable result that the Director would not deduct the expenses paid to subcontractors in the calculation of her self-employment income. It is the existence of the rules, combined with the applicant’s vulnerability as a person with a disability on ODSP, which creates the adverse impact on the applicant.
104In addition, it is our view that the rules were “applied” to the applicant in the sense that she was told by her caseworker that if she continued to work on Cancer Connect, the expenses paid to her subcontractors would not be deducted. She was then told that the rules under the directive could not be challenged before the Social Benefits Tribunal. The applicant was therefore subject to the rules at the time she filed her Application with this Tribunal.
105We also reject the respondent’s argument that the applicant cannot prove adverse treatment because she could have chosen to continue her business in spite of the subcontracting rules or started a different kind of business which would not put her ODSP services at risk. We find it inherently disadvantageous for the applicant to have to choose between her ODSP services and her business aspirations because of rules which attribute income to her which was actually paid out to other people.
106It is important for us to note, however, that we agree with the respondent that the applicant’s perceptions about certain information provided to her by Ms. Vella, and her failure to make any attempts to clarify the short-term and long-term risks that the subcontracting rules would pose to her business, played a role in her decision to immediately cease her business preparations. The applicant testified that she was told by her ODSP worker that she could incur an overpayment equal to the amount of the wages earned by her subcontractors. In other words, if her subcontractors earned $100,000.00, she and her estate would be saddled with an overpayment equal to that amount.
107This is incorrect and despite our many attempts to address this with the applicant, she persisted through the hearing with the assumption that she was at risk of a repayment obligation equal to the wages of her subcontractors. The reality is that any overpayment assessed against her could never exceed the amount the applicant was actually paid in income support. Accordingly, if she was paid $6,000.00 in income support in one year, then $6,000.00 is the maximum amount she would ever be required to repay. Had she taken any steps to clarify this issue, she would also have discovered that her assumption that her health care benefits would be clawed back as part of an overpayment was similarly inaccurate. We have determined that these issues are relevant to remedy, not to liability.
The Connection Between the Prohibited Ground and the Adverse Impact
108The third part of the applicant’s burden is to establish a connection between the adverse treatment and prohibited ground of disability.
109The applicant developed her business model in part around her skills, training, and experience. The model requires the use of subcontractors because the variety of professional services the applicant anticipated that she would offer to her clients. The applicant had confidence that the model permitted her to run the business within the restrictions she lived with as a result of her disabilities. She had gathered a team of business advisors and engaged a graphic designer to assist her in the production of her Cancer Connect guide. Around the time of her discussion with her ODSP worker in November 2013, a member of the applicant’s sales team sold one advertisement in the guide at a cost of $1,500.00, and the applicant was interviewing service providers to add to her roster of subcontractors.
110The respondent argued that the subcontracting rules apply universally to all ODSP recipients and therefore any difficulty the applicant encountered was connected not to her disability, but to the fact that her preferred business model intersects with the subcontracting rules. We have found that this argument does not rebut the applicant’s evidence of a connection between disability and adverse treatment for the following reasons.
111First, the argument presumes that all persons with disabilities are the same and ignores the fact that applying one rule to everyone may have the unintended effect of disadvantaging some persons with disabilities as compared to others. Measures designed to achieve substantive equality should be incorporated into the development and interpretation of rules, particularly in the context of delivering services to vulnerable people.
112Second, it is not accurate to say that the rules apply with equal force to all ODSP recipients. The relevance and effect of the subcontracting rules depends in part on the nature of a person’s disabilities. The rules are only relevant to those ODSP recipients with the ability and aspiration to contribute to their support through self-employment and only to a subset of that group who choose to rely on the regular retention of subcontractors. The rules have no relevance to those individuals who choose forms of self-employment which rely exclusively on their own labour like lawn care, babysitting and piano-tuning services, unless those choices are circumscribed by the fear that the subcontracting rules could interfere with their eligibility for ODSP services.
113The respondent’s evidence did not contradict the applicant’s evidence, set out in para. 27 above, that her disabilities were a factor in the choice of business model for Cancer Connect. In our view, the applicant’s evidence, that she chose a business model which took into account what she was physically and mentally capable of doing, is sufficient to establish a connection between her disabilities and the adverse effect of the subcontracting rules. We disagree with the respondent that the applicant is required to prove that Cancer Connect is the only business she would be able operate in light of her disabilities. The applicant is required to prove that her disability is just one factor in why she experienced adverse treatment. She is not required to prove that she investigated other options which align with both her abilities and the respondent’s subcontracting rules.
114While it is true that we have found that a direct connection exists here between the applicant’s disabilities, her business model and the adverse impact created by the existence of the subcontracting rules, we find that this direct connection is not necessary in order to demonstrate that disability is a factor in why these rules are disadvantageous to ODSP recipients.
115The rules exacerbate the already vulnerable circumstances of all ODSP recipients who aspire to or attempt the kind of self-employment described by the applicant in this Application. Embedded in the operation of the subcontracting rules is an assumption that most ODSP recipients are incapable of engaging in forms of self-employment which have even a modicum of complexity associated with them. We heard from the respondent that only a small number of ODSP recipients attempt self-employment and their businesses typically take the form of one-person enterprises with no employees or subcontractors. Even if this is true, it is inconsistent with the demands of substantive equality to apply rules to every person with a disability on ODSP on the assumption that they are all uninterested in, or incapable of, anything more than a one-person enterprise. It is also a circular argument given the fact that a one-person enterprise is the only viable option for an ODSP recipient in light of the subcontracting rules.
116As the applicant has demonstrated in this Application, ODSP recipients differ in their skills, interests and capacities for self-employment. Modern technologies have given rise to a much broader range of self-employment options for persons with disabilities like the applicant. Where the rules hold recipients back because they fail to keep pace with more modern conceptions of self-employment, the respondent has an obligation to explain why the rules remain relevant to the purpose of the legislation and the people it serves. The rules may not be found to be discriminatory in the final analysis, but that depends on the explanation offered by the respondent. The applicant has done her part by demonstrating that the rules, which impute income to her that she would have paid out to subcontractors, have the potential to interfere with her access to ODSP services and therefore exacerbate her vulnerability as a person with a disability.
117The applicant has met her evidentiary burden and therefore the evidentiary burden shifts to the respondent to demonstrate a reasonable and bona fide justification for the subcontracting rules.
The Respondent’s Burden
The Purpose of the Subcontracting Rules
118The respondent’s burden begins with an explanation of the general purpose of the subcontracting rules.
119The respondent argued that ODSP is not designed to support large or complex businesses, the preferences of ODSP recipients or a business growth strategy. The respondent also argued that there is no evidence of bad faith or abuse of power in the construction of the subcontracting rules.
120This purpose of the subcontracting rules is not set out in the legislation, regulations or policy directive 5.4. There is similarly no definition of what would constitute a large and/or complex business in those documents. The respondent argued that the number of employees and the income generated by a business would indicate how large and complex a business would be, but did not explain how the subcontracting rules contribute to preventing ODSP from being used to support large or complex businesses. The respondent did not explain why the rules are so broad as to capture a situation where engaging even one subcontractor on a regular basis could have the effect of interfering with a recipient’s access to ODSP services.
121The respondent also did not explain what purpose is served by conflating subcontractors with employees. Ms. Lee testified that she thought the applicant’s business was large and complex because she anticipated hiring 32 or more employees. The applicant actually planned on engaging subcontractors, not employees, and she would only engage a subcontractor when she had a demand for their services. Subcontractors are not employees and as the applicant has demonstrated, they would have played a very different role in her business model from employees.
122The only evidence of the origin of the subcontracting rules is that they were part of a similar directive under the FBA. There was no evidence as to why the subcontracting rules were imported from the FBA, how often they are reviewed to ensure that they remain relevant and consistent with the purposes of the ODSP, by what process they are updated or amended, and what has been done when ODSP recipients have drawn attention to the fact that these rules present a barrier to their ongoing eligibility for services.
123There was nothing in the evidence which would assist us in understanding how the subcontracting rules are connected to issues of accountability in general. In fact, the evidence was clear that rules which support employment which may eventually lead to self-sufficiency provide the greatest accountability to taxpayers. Ms. Lee expressed her concern about a recipient earning an exorbitant amount of income from her business and still remaining eligible for ODSP services. This seems unlikely unless a recipient was engaging in fraud, particularly given how much broader the definition of income is under the ODSPA. If the applicant’s actual income and assets eventually exceeded the eligibility thresholds, she would happily transition from ODSP to full self-support. In addition, the respondent’s witnesses testified that they did not know what the implications would be of ODSP permitting the deduction of expenses from subcontractors.
124At the conclusion of the evidence we were still asking the question: what purpose does this approach to subcontracting serve? This was particularly puzzling in light of the fact that the rules actually appear to be at odds with the purpose of the ODSPA, the policy directives in general, and policy directive 5.4 in particular. Everything that was presented to us by the respondent emphasized the importance of breaking down barriers to employment and self-employment for ODSP recipients. To the extent that this approach to subcontracting has its origins in the purpose of the FBA, that legislation was repealed in favour of a more responsible, progressive, and inclusive approach to the support of persons with disabilities under the ODSPA.
125While it is clear that ODSP does not provide economic support to businesses, it is completely incorrect to suggest that ODSP does not provide support to recipients who wish to start a business or even grow an existing business. How else would a person transition to being fully self-supporting? The applicant was not seeking support for her business. She was seeking to have a barrier removed which could interfere with her ongoing eligibility for ODSP services while she is on her way to developing what she hoped would be a profitable and self-supporting enterprise.
126Having failed to establish the purpose of the subcontracting rules, it is not possible to apply the three stages of the Meiorin test, all of which are assessed in relation to the purpose of the directives. The respondent has therefore failed to establish a reasonable and bona fide justification for these directives.
127Even if we accept the respondent’s argument that it is a legitimate purpose to refrain from supporting or being seen to support large and complex businesses and business growth strategies, there was no evidence and no argument raised before us that the subcontracting rules were adopted for that purpose or that they were adopted in good faith in the belief that they were necessary for that purpose, or that they are reasonably necessary to accomplish the purpose, in the sense that the respondent cannot accommodate the applicant without incurring undue hardship.
128In Meiorin, the Supreme Court emphasized the importance of building conceptions of equality into workplace standards. We see no reason to depart from this important principle; in fact quite the opposite, where the standard arises in the context of the government providing support to persons with disabilities:
Employers designing workplace standards owe an obligation to be aware of both the differences between individuals, and differences that characterize groups of individuals. They must build conceptions of equality into workplace standards. By enacting human rights statutes and providing that they are applicable to the workplace, the legislatures have determined that the standards governing the performance of work should be designed to reflect all members of society, in so far as this is reasonably possible. Courts and tribunals must bear this in mind when confronted with a claim of employment-related discrimination. To the extent that a standard unnecessarily fails to reflect the differences among individuals, it runs afoul of the prohibitions contained in the various human rights statutes and must be replaced. The standard itself is required to provide for individual accommodation, if reasonably possible. A standard that allows for such accommodation may be only slightly different from the existing standard but it is a different standard nonetheless. (Meiorin, para. 68)
129There was no evidence about how and why the subcontracting rules were imported from the FBA almost 20 years ago into the ODSPA at a time when persons with disabilities people were explicitly removed from the stigma of “welfare”. The applicant has demonstrated that the rules do not reflect a modern understanding of work-related technologies, many of which make it possible for persons with disabilities to engage in a wider range of self-employment opportunities than ever before. The subcontracting rules fail to incorporate the understanding that not all ODSP recipients are the same in their abilities or aspirations for self-employment. And, most important, they impede rather than support one of the most important goals of the ODSPA, which is to provide employment support to persons with disabilities who are able to contribute to their own support. We find that the rules are arbitrary and exacerbate the vulnerabilities that brought the applicant to the ODSPA program in the first place.
130To return to the preamble of the Code and the observations of the Supreme Court on substantive equality, these rules are inconsistent with the values of understanding, mutual respect and dignity and the necessity to ensure that every citizen has the opportunity to contribute fully to the community. Having regard to all of the relevant contextual factors, including the nature and purpose of the subcontracting rules in relation to the applicant’s situation, we find that the rules discriminate against the applicant because they perpetuate her disadvantage as a person with a disability and subject her to the stereotype that she is less capable than others who aspire to be self-employed.
131For all of these reasons, we find that the subcontracting rules violate the Code and we uphold this part of the Application.
Employment Start-Up Benefit (ESUB)
132The analysis of the ESUB benefit presents us with an opportunity to describe the difference between treatment which is discriminatory and treatment which may create an adverse impact but which is not connected to a prohibited ground under the Code.
133The evidence establishes that the applicant requested the ESUB at some point during the preparations to launch her business. The applicant was required to provide certain information, the most important of which was proof that the business was operating. The respondent does not agree that the applicant provided sufficient information or that the required information could be inferred from her correspondence. Her request was denied and a subsequent review of the request was also denied on the same basis.
134The applicant has a disability and we accept that the denial of the ESUB could constitute adverse treatment. However, the arguments about the connection between the applicant’s disabilities and the adverse impact of the sub-contracting rules do not apply here. The applicant felt she provided sufficient information to qualify for the benefit, and the respondent disagreed, twice. Any connection to the nature of the applicant’s business or her disability is speculative. This is a good example of what Justice Abella was emphasizing in McGill: not every experience of adverse treatment which happens to a person who identifies with a prohibited ground will be discriminatory.
135Even if we found that the instructions were not clear or that the decisions were wrong, they are still not discriminatory.
136Having failed to establish that there is a connection between the denial of ESUB and the prohibited ground of disability, the respondent is not required to justify the decision as reasonable and bona fide and this portion of the Application is dismissed.
Section 14: Special Program
137In this case, the respondent also invoked the exemption in the Code which protects a special program from findings of discrimination. The burden is on a respondent to prove that the exemption applies in these circumstances. Given that we have dismissed the applicant’s allegations on the denial of ESUB, we do not consider it necessary to address the section 14(1) arguments made in relation to that incident.
138Section 14(1) of the Code reads as follows:
A right under Part I is not infringed by the implementation of a special program designed to relieve hardship or economic disadvantage or to assist disadvantaged persons or groups to achieve or attempt to achieve equal opportunity or that is likely to contribute to the elimination of the infringement of rights under Part I.
139The respondent argues that the ODSPA establishes a special program pursuant to section 14(1) of the Code which is designed to relieve disadvantage and economic hardship for persons with disabilities. The respondent argues that policy directive 5.4 supports the self-employment opportunities of the vast majority of ODSP recipients. The respondent also argues that while the applicant is, broadly speaking, within the group (ODSP recipients) that the program is intended to benefit, her allegations arise as a result of her business plan, not her disability.
140We do not agree that section 14(1) applies in this case. We agree and apply the analysis of this issue from the decision in Ball which also cites the decision in Ontario (Human Rights Commission) v. Ontario (1994), 1994 CanLII 1590 (ON CA) (“Roberts”). Section 14(1) only insulates a program from review where the challenge is from “a member from a historically privileged group or a disadvantaged person whose disability the program was not designed to benefit”. The Court in Roberts stated, at page 407:
In this case, the Board of Inquiry and the Divisional Court erred in law in finding that the inquiry ends when “special program” status is proven. The inquiry should have considered: (1) whether a particular provision or limitation of a special program results in discrimination against a person or group with the disadvantage the program was designed to benefit, and (2) whether the provision or limitation is reasonably related to the scheme of the special program.
141Even if we accept that the whole of the ODSP is a special program, the program is clearly designed to provide income support, health benefits and employment supports, including self-employment supports, to the applicant, who is eligible for those services. We have found that a particular limitation (the approach to subcontracting) results in a disadvantage to the applicant which is connected to her disability. We have also found that the respondent has failed to prove that this limitation is reasonably related to the scheme of the ODSP.
142We also agree with the Tribunal in Ball as to how the decision in Kapp affects the Roberts analysis and particularly this statement at paragraph 120:
The analysis in Kapp does not detract from or contradict the reasoning in Roberts about why, when a member of the targeted group is excluded on a prohibited ground, substantive equality is undermined. Madam Justice Weiler, writing for the majority in Roberts, explained this eloquently at p. 402 as follows:
In the context of this case, to say that s.14(1) exempts the age discrimination in the vision aids category of the ADP program from review, is to interpret the section so as to permit substantive equality to be undermined, when substantive equality is one of the section's very purposes. It is to permit unfairness which is antithetical to the overall purposes of the Code. Fairness, and the recognition of substantive equality, require that discrimination, in the provision of a service to a person who is a member of a disadvantaged group for whom a special program is designed, not be tolerated and be subject to review. This interpretation does not second-guess the Legislature. Rather, it fulfils one of the purposes of the Legislature and is consistent with the overall purpose of the Code.
143Accordingly, we find that section 14 does not exempt the respondent from a finding of discrimination under the Code in these circumstances.
144Having found that the approach taken by ODSP to subcontracting discriminates against the applicant, we turn now to the issue of the appropriate remedy.
Remedy
145The Tribunal’s remedial powers are set out in section 45.2(1) of the Code, which provides the Tribunal with the discretion to order monetary compensation for injury to dignity, feelings and self-respect, to order restitution other than through monetary compensation and to direct any party to do anything to promote compliance with the Code.
146Section 45.2 of the Code reads as follows:
45.2(1) On an application under section 34, the Tribunal may make one or more of the following orders if the Tribunal determines that a party to the application has infringed a right under Part I of another party to the application:
An order directing the party who infringed the right to pay monetary compensation to the party whose right was infringed for loss arising out of the infringement, including compensation for injury to dignity, feelings and self-respect.
An order directing the party who infringed the right to make restitution to the party whose right was infringed, other than through monetary compensation, for loss arising out of the infringement, including restitution for injury to dignity, feelings and self-respect.
An order directing any party to the application to do anything that, in the opinion of the Tribunal, the party ought to do to promote compliance with this Act.
(2) For greater certainty, an order under paragraph 3 of subsection (1),
(a) may direct a person to do anything with respect to future practices; and
(b) may be made even if no order under that paragraph was requested.
147The Code is remedial and not punitive. Orders of the Tribunal should provide individuals who have been discriminated against with access to fair and effective remedies tailored to the facts of the case in order to achieve this remedial purpose. See, Heintz v. Christian Horizons, 2008 HRTO 22 (“Heintz”).
148We did not find it necessary to rely on findings of credibility in determining that the Code has been breached. With respect to remedy, we have raised questions about the reliability of the applicant’s evidence in two respects: her interpretation of the discussion with Ms. Vella on November 1, 2013, and her predictions about the potential success of her business, which is what grounds her request for damages for lost opportunity and income.
149The applicant is seeking a monetary award of $768,627.18, which represents the applicant’s estimation of lost opportunity and income on a net basis over the course of 10 years. She attributes these losses directly to the existence of the subcontracting rules. Included in that sum are the applicant’s start-up costs for Cancer Connect, totalling $1,356.23. The applicant is seeking an additional $100,000.00 in damages for injury to dignity, feelings and self-respect and interest on all monetary amounts awarded to her.
150The applicant is also seeking an order from the Tribunal directing the respondent to cease applying the subcontracting rules and to train ODSP staff in relation to the changes. The applicant requested that a copy of this decision be provided to the Ontario Human Rights Commission, although she was advised at the hearing that this is the Tribunal’s general practice.
Applicant’s Evidence on Impact
151The applicant testified that she was in great spirits as she worked through the fall of 2013 getting ready to launch Cancer Connect. She had gathered a team of advisors who were equally optimistic about the potential the business had for success. The applicant testified that the business model was particularly meaningful to her as a cancer patient because it gave her the opportunity to give back to her community.
152It is important to note that while the applicant had made extensive preparations to launch her business and had sold one advertisement, there was no evidence that she had acquired any clients who would pay for the services provided by subcontractors at this stage.
153The applicant testified that she was shocked to learn about the approach that ODSP would take to the treatment of her business income. She was terrified by what might happen if the income of her subcontractors was imputed to her before she was earning enough money herself to transition from ODSP services. The applicant did not anticipate that she would have income imputed to her in determining her ongoing eligibility. She had assumed that her ongoing entitlement would be calculated on the basis of her own income.
154The applicant testified that she although she was devastated by the phone call with Ms. Vella, she wanted to continue to move forward with Cancer Connect. However, her three primary supporters, Patrick Wyllie, Al Cordovado, and Peter Zelinski, cautioned her that they would not support her if it meant she would be at risk of such an enormous overpayment and the loss of her ODSP services. As a result, the applicant took steps to close down her business.
155The applicant testified that the news about the subcontracting rules, and the subsequent steps she took to challenge the rules and close down her business, have created a number of physical and psychological effects: uncontrollable stress; the inability to sleep; loss of appetite; loss of any and all enjoyment in life; increased “chemo brain” or the brain fog she experiences from chemotherapy treatments; and suicidal thoughts. The applicant testified that she was depressed, anxious and sought support from a psychiatrist. She experienced bouts of very high blood sugar which she also attributes this experience.
156The applicant blames the respondent for taking her business away and giving her nothing to look forward to. The applicant testified that she was completely demoralized by the fact that she had come up with a promising business idea and, in her mind, was being told by ODSP that she could not pursue her business plan. She testified that she was embarrassed about having to let everyone know that she could not continue with the business, particularly the business owner who had already committed to a $1,500.00 advertisement in the Cancer Connect Guide.
157When the applicant testified about the impact on her of the news about the subcontracting rules, she cited the inability to write. However, it appears clear from the applicant’s own testimony that this was the symptom which caused her to seek medical treatment on or about October 29, 2013. She was subsequently investigated for evidence of a minor stroke or heart issues. The applicant also testified that the cancer itself had affected her ability to handle stress. Before her diagnosis she was able to handle a considerable amount of stress and never suffered any psychological problems. The applicant testified that her ability to handle stress has been significantly diminished since her diagnosis.
158In addition to the physical and emotional effects, the applicant testified that learning about the subcontracting rules and shutting down her business caused her a substantial loss of income and the loss of a viable business to pass down to her only heir. She testified that Cancer Connect as an organization has lost credibility with the businesses that were approached in the fall of 2013. The applicant testified that the loss of the business also contributed to the loss of her personal partner and that she felt forced to stay on the (ODSP) system.
159Patrick Wyllie, Al Cordovado and Peter Zelinski all testified about their support for Cancer Connect. They observed the impact on the applicant when she advised them of her conversation with Ms. Vella and subsequently chose to close the business.
160Lisa Flesher also testified about her involvement in the development of the applicant’s business. She met with the applicant at the end of September or beginning of October to discuss the Cancer Connect guide. Ms. Flesher is a very experienced graphic designer and worked with the applicant on her logo, the layout of the guide and sponsorship rates. Ms. Flesher was advised at some point to stop working because the applicant was not able to proceed with her business plan.
161Patrick Wyllie was responsible for setting up the bookkeeping program and assisting with advertising, discussions with car dealerships and meetings with PSW candidates. He was aware that approximately 29 PSW’s and 5 drivers had been interviewed. Mr. Wyllie understood that Cancer Connect would start with a handful of subcontractors and grow from there as more demand developed for the services. He thought the whole point of the enterprise was to one day make the applicant self-supporting.
162Al Cordovado had experience in outside sales and was to be the organization’s transportation manager. He had also worked in the health care field, setting up oxygen in people’s homes for palliative care. He was personally aware of the shortage of services in the community and how stressful that was for families and caregivers. He had the idea to approach car dealerships for advertising and donations of vehicles and was initially getting very positive responses. Mr. Cordovado testified that the news of the subcontracting rules had taken the wind out of the applicant’s sails. He observed that she was sad and disheartened and appeared to be depressed, particularly because she had looked forward to giving back to her community and passing the business onto her daughter. Mr. Cordovado felt that the business had good potential and that, like most businesses, it would take approximately five years for it to become successful. He had hoped that the applicant would grow the business and eventually achieve financial independence, which would bring her a greater sense of self-worth.
163Peter Zelinski provided the applicant with financial support for her initial start-up, moral support and general advice. Mr. Zelinski drove the applicant to medical appointments and was close to her on a daily basis. He described her before the November 1, 2013 call as very enthusiastic, optimistic, happy, cheerful and pleased that the business was progressing as well as it was. He testified that after the call, the applicant was stunned by her conversation with Ms. Vella, completely demoralized and under a lot of stress. He was aware that she was having trouble sleeping and eating and experiencing serious blood sugar fluctuations. Mr. Zelinski was very concerned about the applicant having suicidal thoughts. He was aware that she was worried about leaving debts (in the form of a large overpayment) for her daughter. He was also aware that the applicant was having difficulty writing. He testified that she still has difficulty with certain word pronunciations and definitions, which he attributes to the period after the call with Ms. Vella. Mr. Zelinski testified that the applicant was full of enthusiasm and optimism at the prospect of getting off ODSP and having her own income as well as providing a needed service in the community. He described her as a very capable person with many skills and much experience and that Cancer Connect would have been the ideal business for her.
164Mr. Wyllie, Mr. Cordovado and Mr. Zelinski all advised the applicant that she should discontinue her business preparations. That advice was based on what the applicant told them about the potential for an overpayment in the amount of her subcontractor wages and the potential loss of her income support and health benefits.
Analysis
Compensation for Lost Opportunity and Income Loss
165Subsection 45.2 (1)1 of the Code directs the Tribunal to consider what loss arose “out of the infringement” of the Code when considering the proper amount of monetary compensation. In Airport Taxicab (Malton) Assn. v. Piazza, (1989), 1989 CanLII 4071 (ON CA), 10 C.H.R.R. D/6347 (Ont. C.A.), the Ontario Court of Appeal, at para. 45017, stated that the “purpose of the compensation is to restore an applicant as far as is reasonably possible to the position that the applicant would have been in, had the discriminatory act not occurred”.
166There were no cases presented to us involving compensation for lost opportunity in a context like this, where the applicant claims that a government benefit provider caused the loss of the applicant’s self-employment opportunity. In most cases, the allegation is that the benefit provider is responsible for the applicant’s loss of benefits. In this case for example, if the applicant had continued her business and acquired an overpayment as a result of the application of the subcontracting rules, she would be entitled to have that overpayment set aside.
167The Tribunal has dealt with the concept of lost opportunity in a number of decisions in the employment context. See: Ravi DeSouza v. 1469328 Ontario Inc., 2008 HRTO 23; Seguin v. Great Blue Heron Charity Casino, 2007 HRTO 33; Chaudhry v. Choice Taxi of Cornwall Inc., 2013 HRTO 756. In those cases the Tribunal considered whether there was a reasonable or serious possibility of the applicant being successful in a job competition but for the discrimination they experienced. In Chaudhry, the Tribunal considered the effect of reprisal by the respondents on the applicant’s prospects of success in becoming a shareholder in a taxi service.
168In Norrena v. Primary Response Inc., 2013 HRTO 1175, the Tribunal found that at an early stage in the hiring process, what was lost was an opportunity for future employment, rather than a loss of employment.
169The applicant relied on the decision in University of British Columbia v. Kelly, 2015 BCSC 1731 (“Kelly”), in support of her claim for lost opportunity and lost wages in relation to Cancer Connect. As a result of the applicant’s reliance on this case, we felt that it was important to explain why the facts of this case should be distinguished from the facts in Kelly.
170Dr. Kelly graduated from the undergraduate medical program at the University of British Columbia. He became a resident in the two-year Family Medicine Resident Program. The Tribunal found that failure from that program was rare. Dr. Kelly had some difficulty with some aspects of the program because of his disabilities and ultimately he was dismissed. Losing his status as a student meant the loss of his employment. The Tribunal found that the respondent failed to accommodate Dr. Kelly and awarded general damages in the amount of $75,000.00 and over $385,000.00 for lost wages. The award for general damages was overturned on judicial review but the lost income award was upheld.
171The differences between the applicant’s case and the Kelly case are significant. Dr. Kelly was awarded lost income for the six-year period that he was delayed in entering the labour market. That income was reduced to reflect a 10 percent possibility that he might not complete the program once he was re-admitted and a 20 percent possibility that he might not maintain a full-time practice once he graduated.
172The projected lost earnings were found to have flowed from the factual findings of the Tribunal: if Dr. Kelly had not been terminated from the program, he was on course to enter the labour market as a family doctor by January 1, 2010; there was a low probability that he would not successfully complete the program and start practising as a physician; and Dr. Kelly had fulfilled his duty to mitigate by making reasonable efforts to secure alternative employment.
173In our view, the Kelly case explains how a Tribunal grounds an award for lost wages and lost opportunity where the Tribunal has a reasonable basis for connecting those losses directly to the discrimination. In other words, but for the discrimination he experienced which delayed him by six years, the odds were significantly in his favour that Dr. Kelly would graduate from the program and start work as a family physician.
174The same cannot be said about the evidence supporting the applicant’s claim. In the applicant’s case, what we can conclude from her evidence is that she is a dynamic, intelligent and experienced person with a promising business idea who had made extensive preparations to launch Cancer Connect. Whether and for how long she would have remained physically capable of running the business in the face of her diagnosis, and how much income she would have earned from the business even in the first year, would involve complete speculation on our part.
175We must also factor into this analysis the respondent’s argument, with which we agree, that the applicant did not do what would be expected of a prudent business owner faced with the news she received on November 1, 2013. The applicant’s response to her initial telephone conversation with Ms. Vella was to become irate, call CRA, confirm that expenses paid to subcontractors are considered a normal deduction under CRA rules, and then write to Ms. Vella accusing ODSP of engaging in illegal activity.
176Despite her testimony that Ms. Vella had always been professional and courteous toward her, the applicant did not sit down with her and work out precisely what the impact would be on her business plans and her ongoing entitlement to ODSP services. She relied on her perceptions and assumptions without seeking out further information to inform her decision about whether or not to close her business, continue it in a different form, or even engage her supporters in thinking about the options available to them.
177The two critical assumptions driving the applicant’s decision to close the business were her belief that the more her subcontractors earned the greater her overpayment would be and that her health benefits would be clawed back as part of any overpayment. Neither of these propositions are true and even a modicum of research and discussion with representatives of ODSP would have resulted in clarifying these concerns.
178The applicant testified that after speaking to Ms. Vella about her business, she documented the telephone conversation, and that Ms. Vella told her during that conversation that if she went ahead with her business, ODSP would create an overpayment in the amount of all the contracted out workers’ wages. Considering all of the evidence we heard, we find that this evidence is not reliable for the following reasons.
179It was clear from all the evidence that despite the applicant having received many explanations of how an overpayment is calculated, even during the hearing, she still does not understand that an overpayment cannot be assessed in an amount that is greater than the amount of income support the applicant received from ODSP. As such, we find that what the applicant documented when speaking with Ms. Vella was her understanding of what Ms. Vella told her. We reach this conclusion because of the applicant’s continued misunderstanding of the calculation of an overpayment, coupled with the evidence of Ms. Vella, an ODSP caseworker for more than four years at the time of the conversation, that she did not tell the applicant what the applicant alleges she told her.
180Ms. Vella testified that she told the applicant that she could not deduct the subcontractors’ wages and those monies would be attributed to the applicant as income. In response to a follow-up question from the applicant, Ms. Vella denied that, in the applicant’s words, this meant she was saying that by the end of a business year all the subcontractors’ wages would become an erroneous overpayment against the applicant. This demonstrates that the applicant failed, and continues to fail, to make a distinction between the attribution of income and the calculation of the overpayment. We find that the applicant formed her erroneous opinion when she first spoke with Ms. Vella and that this is how she recorded her understanding of what Ms. Vella told her. While the misunderstanding is understandable, it means the applicant’s evidence on this point is unreliable.
181Ms. Vella’s evidence with respect to the fact that an overpayment amount cannot be greater than the amount of income support an income recipient receives from ODSP was also supported by Ms. Lee’s evidence.
182A remedy for lost wages and lost opportunity must be related to the service at issue and derived from the discrimination. The applicant cannot blame ODSP for her failure to apprise herself of all of the risks of operating her business. We have come to the conclusion that while we cannot predict with any certainty how the applicant’s business would have performed, it is reasonable to expect that if the applicant knew that her overpayment could never exceed the approximately $6,000.00 she received in income support and that transitional and extended health benefits were available to her, this would have made an enormous difference to her decision whether or not to proceed with the business. We make this finding on the basis of the applicant’s own testimony that even in the face of her belief that she could end up with an overpayment in the amount of her subcontractors’ wages, she wanted to keep working on Cancer Connect. Her advisors withdrew their support because of the applicant’s assumptions and that is what ultimately brought her business preparations to an end.
183For these reasons we find that we do not have a basis for awarding the applicant lost wages or damages for lost opportunity.
184On the other hand, we have concluded that it is entirely reasonable for the applicant to have started her preparations for Cancer Connect on the assumption that income earned by other people would not be imputed to her. For that reason we find that she is entitled to the costs she incurred during the preparation phase (her out-of-pocket expenses) which were calculated in the amount of $1,356.23.
Damages for Injury to Dignity, Feelings and Self-respect
185Damages for injury to dignity, feelings and self-respect are generally awarded to a successful applicant. In this case, the parties were directed to the decision of the Tribunal in Hendershott v. Ontario (Community and Social Services), 2011 HRTO 482 (“Hendershott”), which contains a discussion of the legal principles which apply to an award of damages for injury to dignity, feelings and self-respect in a case where discrimination arises from legislation or regulation.
186The Tribunal in Hendershott reviewed the issue in light of the cases of Mackin v. New Brunswick (Minister of Finance), 2002 SCC 13 (“Mackin”), and Québec (Commission des droits de la personne et droits de la jeunesse) v. Communauté urbaine de Montréal, 2004 SCC 30 (“Larocque”), both of which were adopted by the Divisional Court in Ontario (Attorney General) v. Ontario Human Rights Commission, 2007 CanLII 56481 (ON SCDC) (“Braithwaite”). The Tribunal also dealt with this issue in Ball, above. In all of these cases, the Court or the Tribunal declined to order compensation for injury to dignity, feelings and self-respect.
187In Mackin, the court at para. 78 states that there is a general rule of public law that unless the government’s conduct is clearly wrong, in bad faith or an abuse of power, courts will not award damages for the harm suffered as a result of the mere enactment or application of a law that is subsequently declared to be unconstitutional.
188Since the Tribunal does not have the jurisdiction to declare legislation unconstitutional, the question arose in Hendershott as to whether the cases cited above are applicable to the Tribunal when deciding whether to award damages for injury to dignity, feelings and self-respect.
189The Tribunal reviewed the 2004 Supreme Court of Canada decision in Larocque, which involved an individual who had been denied employment as a municipal police offer because of a hearing impairment. The City of Montreal had adopted minimum hearing requirements which were enshrined in a by-law made pursuant to the city’s regulatory powers in its enabling legislation. The Supreme Court affirmed the Court of Appeal’s decision that it could not award damages (para. 23). The Tribunal therefore in Hendershott concluded it was bound by this decision and declined to award damages for injury to feelings, dignity and self-respect (para. 116).
190Similarly, we are bound by these decisions. This case differs from Hendershott because the impugned rules are contained in a policy directive that is neither legislation nor regulation. However, the policy directives are derived from the legislative authority of the Director of ODSP to determine eligibility and generally administer the provisions of the ODSPA and Regulations. The policy directives ensure consistency in how the legislation and regulations are applied across the province. The evidence, from Ms. Vella in particular, is that she applied the rules to the applicant’s circumstances in the good faith belief that she was properly interpreting the policy directive. As a result, in our view the policy directive, and Ms. Vella’s actions in pointing out the subcontracting rules to the applicant, constitutes part of the “application of a law” as set out in Mackin at para. 78. See also the decision in Wynberg v. Ontario, 2006 CanLII 22919 (ON CA), relied on by the respondent.
191We therefore find that we cannot award damages for injury to dignity, feelings and self-respect. There is no evidence of bad faith or abuse of power, and conduct on the part of government cannot be said to have been clearly wrong simply because this Tribunal determines, after the fact, that it is discriminatory.
Promoting Future Compliance
192The Tribunal does not have jurisdiction to set aside or strike down legislation or to formulate or require the adoption of a new legislative or regulatory provision; however, the Tribunal may direct the respondent not to follow the offending legislation, or in this case, policy directive. As was the case in Ball and Hendershott, the appropriate order to remedy the breach of the Code is to direct the respondent to cease relying on the rule against the regular retention of subcontractors and to treat expenses paid to subcontractors as an approved business expense.
193The Tribunal also has the remedial authority to direct a respondent to take positive steps in order to comply with its obligations under the Code.
194We are acutely aware that this Application was brought forward by a self-represented person who is extremely vulnerable. The declaration of discrimination and the award for lost start-up expenses will be cold comfort to the applicant who advanced this Application despite the significant and ongoing effects of cancer and cancer treatment. This case highlights the necessity for the respondent to be proactive in examining potential barriers to self-employment rather than placing the burden on ODSP recipients to come forward and challenge them under the Code.
195Our authority to remedy discrimination extends to directing the respondent to take proactive steps to ensure that all of the rules governing self-employment conform with the Code. The respondent is therefore directed to undertake a review of the self-employment rules, within the next six months, to ensure conformity with the Code and the purpose of the ODSP to support self-employment. The respondent is to file a report within six months from the date of this Decision with the Tribunal and the applicant, describing its efforts to comply with this direction. The Tribunal will remain seized with respect to the implementation of this direction and may issue further directions when the report is received.
196In addition to acknowledging the efforts of the applicant to bring this matter before the Tribunal, we wish to acknowledge and thank counsel for the respondent who was professional, courteous and cooperative throughout what was at times a very difficult pre-hearing and hearing process.
ORDER
197The Tribunal makes the following orders:
The applicant’s allegation that she experienced discrimination when she was denied the ESUB is dismissed;
The applicant’s allegation that the rules contained in policy directive 5.4 which prohibit the regular retention of sub-contractors and the deduction of expenses paid to them from gross self-employment income is upheld;
The respondent will immediately cease applying the subcontracting rules in accordance with paragraph 192 above;
The respondents will pay to the applicant the out of pocket expenses she incurred in the start-up of Cancer Connect in the sum of $1,356.23;
The respondent will pay pre-judgment and post-judgment on the award of $1,356.23 in accordance with the Courts of Justice Act, R.S.O. 1990, c. C.43;
The respondent will undertake a review of the self-employment policy directives within the next six months to ensure conformity with the Code and the purpose of the ODSP to support self-employment. The respondent will file a report within six months from the date of this Decision with the Tribunal and the applicant, describing its compliance with this order; and
The Tribunal will remain seized with respect to the order associated with the review of the self-employment policy directives.
Dated at Toronto, this 8th day of June, 2016.
“Signed by”
Leslie Reaume
Vice-chair
“Signed by”
Dawn Kershaw
Vice-chair