GSB# 2017-1802

UNION# 610276

IN THE MATTER OF AN ARBITRATION

Under

THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT

Before

THE GRIEVANCE SETTLEMENT BOARD

BETWEEN

Ontario Public Service Employees Union (Union)

Union

• and -

The Crown in Right of Ontario (Treasury Board Secretariat)

Employer

BEFORE

Jasbir Parmar

Arbitrator

FOR THE UNION

Allison Kabayama Ontario Public Service Employees Union Grievance Officer

FOR THE EMPLOYER

Benjamin Parry Treasury Board Secretariat Legal Services Branch Senior Counsel

HEARING

November 1, 2017

Decision

I. INTRODUCTION & JURISDICTION

1This is a decision in respect of an appeal of denial of benefits, filed by Mr. F.D. (or Mr. D).

2My jurisdiction to address this matter arises under Article 22.9.2 of the collective agreement between the parties. For convenience, I set out the entirety of Article 22.9:

22.9 INSURED BENEFITS GRIEVANCE

22.9.1 An allegation that the Employer has not provided an insured benefit that has been contracted for in this Agreement shall be pursued as a Union grievance filed under Article 22.13 (Union Grievance)

22.9.2 Any other complaint or difference shall be referred to the Claims Review Subcommittee of the Joint Insurance Benefits Review Committee (JIBRC), established under Appendix 4 (Joint Insurance Benefits Review Committee), for resolution.

3Appendix 4 (attached as Schedule 1 to this decision) states that one of the duties of JIBRC is to “review contentious claims and recommendations thereon, when such claims have not been resolved through the existing administrative procedures” (see paragraph 4(vi)). Of note, the Employer’s Long-term Income Protection Plan (L.T.I.P.) is administered by Manulife (sometimes referred to as the carrier or the insurer).

4Appendix 4 provides for a subcommittee, whose mandate is to review and make decisions on complaints involving the denial of insured benefits under the central collective agreement. The subcommittee includes an independent third party agreed to by both parties. I am the independent third party agreed to by the parties in the instant case. The Appendix also states that decision of the subcommittee is final and binding (see paragraph 6(d)).

5The parties have developed Terms of Reference for the JIBRC Claims Review subcommittee (attached as Schedule 2 to this decision). For the purposes of the present case, it is sufficient to note the following significant points:

i. the subcommittee represents the final stage in the appeal process;

ii. the decisions of the subcommittee are final and binding; and

iii. decisions must be in accordance with the OPS collective agreement and consistent with the group insurance plans in place at the time the facts giving rise to dispute arose.

6Also of relevance is a new provision that was added to the collective agreement during the last round of bargaining (or rather was a significant revision of an existing provision). I refer to Article 42.7 of the collective agreement, which provides as follows:

42.7.1 Rehabilitative plans and programs for employees receiving L.T.I.P. benefits, whether with the OPS or another Employer, shall be required where recommended by the Carrier. “Rehabilitative employment” is a rehabilitative plan or program and means remunerative employment while not yet fully recovered, following directly after the period of total disability for which benefits were received. When considering rehabilitative plans and programs, L.T.I.P. will take into account the employee’s training, education and experience. If a person does not participate or cooperate in a rehabilitation plan or program that has been recommended or approved by the Carrier, the employee will no longer be entitled to benefits. If an employee who is in receipt of L.T.I.P benefits is resuming employment on a gradual basis during recover, partial benefits shall be continued during rehabilitative employment. The rehabilitative benefit will be the monthly L.T.I.P. benefit less fifty percent (50%) of rehabilitative employment earnings. The benefit will continue during the rehabilitative employment period up to but not more than twenty-four (24) months.

42.7.2 Where a person does not participate or cooperate in a rehabilitation plan or program that has been recommended or approved by the Carrier and the employee is no longer entitled to benefit, the employee will have the ability to file for an expedited review of the decision to end benefits directly to the Claims Review Subcommittee under Appendix 4 (Joint Insurance Benefits Review Committee) within 30 days of the decision to end benefits. The parties agree that such matters will be heard within 60 days by the Claims Review Subcommittee as per paragraph 6(a) of the Appendix 4, unless the parties mutually agree otherwise. [Emphasis added]

7The key procedural factor to note is that Article 42.7 provides for an expedited process, allowing for a review of a decision to end benefits to be referred directly to the claims review subcommittee within 30 days of the decision to terminate benefits. The instant case comes before me as a result of this expedited process. In fact, this is the first decision under this expedited process.

8The Terms of Reference identified above were prepared for the standard process. For the purposes of this case, the parties have agreed that they are applicable to the expedited process.

9It is also useful to note that the collective agreement, in Article 42.2.3, provides for L.T.I.P benefits where an employee is “totally disabled”. Totally disabled is defined therein as follows:

Total disability means the continuous inability as the result of illness, mental disorder, or injury of the insured employee to perform the essential duties of his or her normal occupation during the qualification period, and during the first twenty-four (24) months of the benefit period; and thereafter during the balance of the benefit period, the inability of the employee to perform the essential duties of any gainful occupation for which he or she is reasonably fitted by education, training or experience.

II. BACKGROUND & ISSUE

10The parties have agreed to the following Agreed Statement of Facts:

1. Mr. F.D. has been an employee of the Ontario Public Service since March of 2001 and was hired by the Ministry of the Attorney General to work as a Law Clerk. His home position is located in the Legal Services Branch of the Ministry of Community and Social Services/Ministry of Children and Youth Services.

2. Mr. F.D. left the workplace on short-term sick leave on July 22, 2015.

3. Mr. F.D. applied for LTIP benefits on January 24, 2016 and his application was denied.

4. On May 19, 2016, Mr. F.D. filed an Appendix 5 appeal regarding the denial of his LTIP application.

5. On December 1, 2016, Mr. F.D.’s appeal was allowed. Mr. F.D.’s date of disability was determined to be January 24, 2016. Mr. F.D.’s period of total disability was determined to commence on July 24, 2016.

6. On March 22, 2017, Mr. F.D.’s LTD benefits were terminated effective April 19, 2017.

7. On June 23, 2017, Mr. F.D.’s LTD benefits were reinstated effective June 26, 2017.

8. On July 31, 2017, Mr. F.D.’s LTD benefits were terminated.

9. Mr. F.D. filed an Appendix 5 appeal on August 8, 2017 regarding the termination of his LTIP benefits effective July 31, 2017.

10. The claim was referred to the Claim Review Subcommittee on an Expedited Basis for determination on August 9, 2017.

11. Mr. F.D. has not returned to and remains out of the workplace.

12. Mr. F.D. claims that he is entitled to benefits for the OWN OCCUPATION period from July 31, 2017 to present.

11As can be seen from the agreed statement of facts, Manulife determined Mr. D met the test to receive L.T.I.P. benefits beginning January 24, 2016. He has been in receipt of those benefits through to July 31, 2017 (with the exception of the period from April 19, 2017 to June 26, 2017 when benefits were suspended because Mr. D was not in communication with Manulife).

12On July 31, Manulife wrote to Mr. D advising that his benefits were terminated because he was deemed to be non-compliant with the Mandatory Rehabilitation Program. While not specifically referenced in the letter, Article 42.7.1 provides the insurer with the authority to terminate benefits where an employee does not participate or cooperate in a recommended rehabilitation plan.

13It is this July 31 decision to terminate benefits which Mr. D has appealed and is at issue in the present case.

III. ANALYSIS

14I have considered all of the documents and the submissions of the parties. Consistent with the expedited nature of this case, I will not set out the documents or submissions in any detail. Rather, I will focus on what I view to be the most relevant factors.

15The mandatory rehabilitation program at issue was detailed in a letter to Mr. D dated June 26, 2017. The relevant portion of the letter stated as follows:

We have decided to refer your claim back to rehab as per the medical information. We will be providing you with Cognitive Behavioral Therapy (CBT) treatment effective the week of July 3, 2017. We will be informing you shortly of the specific dates of treatment. Please note that if you miss any appointments, your file will be closed immediately.

Based on the medical information, following 8 sessions of CBT treatment, it is expected that you would be able to return to work on a full-time basis. Therefore we will be moving forward with a gradual return to work during the course of this treatment. We will be speaking with your Employer to help formulate a gradual return to work beginning on the week of July 31, 2017. We will provide you with a 4 week Gradual return to work to begin on the week of July 31, 2017 with a return to full time work expected on the date of August 28, 2017. Please note that following the date of August 28, 2017, there will be no further consideration of benefits as the medical information indicates that following 8 sessions of CBT treatment, a return to work is expected. Therefore your file will be closed on the date of August 28, 2017.

We will inform you of the Gradual return to work once it becomes available. Please note that any lack of participation by yourself including missed appointments or any missed shifts, will be deemed non-compliance with the Mandatory Rehab provision set out in the policy and your file will be immediately closed with no further consideration given to benefits. [Emphasis added]

16There is no dispute that Mr. D was informed of the scheduled gradual return to work to begin on July 31, and no dispute that he did not attend at work as directed.

17The issue is whether that failure to attend at work constitutes a failure to “participate and cooperate in a rehabilitation plan or program that has been recommended or approved by the Carrier”, and therefore justifies termination of benefits.

18The Union takes issue with the plan that Manulife recommended. It submits that Manulife does not have carte blanche to impose any plan it wants. I agree.

19Article 42.7.1 does not, on its face, place any express limits on the insurer with respect to how it makes a determination to recommend a rehabilitation plan. However, it must be remembered that compliance with the plan is a requirement for an employee to be able to continue to receive the negotiated collective agreement L.T.I.P. benefit.

20If the insurer’s decision to recommend a plan is not subject to any review, the insurer (as agent for the Employer) could conceivably negate the entire scheme of benefits provided for in the collective agreement, which is to provide income replacement for employees who meet the definition of total disability. If the insurer’s decision was immune to review, the test for entitlement would effectively change to whether the employee was doing whatever the insurer told him or her to do.

21To protect against such an outcome, at the very least an insurer’s decision to recommend a plan must be subject to review on the basis it is not arbitrary, discriminatory, or made in bad faith. There may even be an argument it needs to be reasonable.

22The Employer submitted that, in the present case, Mr. D agreed to and accepted the plan recommended by Manulife. The Employer submitted that having failed to object at any point when advised of the plan or during the course of the implementation of the plan, it is not open to an employee to complain about the plan after the fact.

23To accept this argument would be to impose a positive obligation on employees failing which they would lose their right to be treated fairly by the insurer and their right to receive disability benefits as provided in the collective agreement. Quite simply, to have such a result would require express language in the collective agreement or the plan. There is no such language.

24I also observe that it is incumbent on an insurer, who seeks to be able to enforce compliance with a rehabilitation plan through the possibility of denial of benefits, to ensure its process of determining the rehabilitation plan can survive arbitral review. It is not enough to seek cover in the actions of an insured employee who has no other source of income and is told ‘comply with what we are telling you or you will get no benefits’.

25In the present case, I find Manulife’s decision to require Mr. D to comply with the rehabilitation plan outlined in the letter of June 26 to be arbitrary. The rehabilitation plan that was imposed was not based on any medical documentation or advice. The Claims Manager told Mr. D on June 23 in a telephone call that he would receive eight sessions of cognitive behavioral therapy (CBT); that he was expected to begin a graduated return to work after four sessions; and that he was expected to return to full-time work four weeks after that.

26There are medical opinions on file which indicate CBT was appropriate for Mr. D’s disability. However, there is no medical opinion which indicates Manulife’s rehabilitation plan is a suitable treatment plan to enable Mr. D to return to work.

27The most definitive statements come from Dr. Tang-Wai, the psychiatrist who conducted an Independent Medical Examination (IME) at the request of Manulife. Dr. Tang-Wai, in his report of November 15, 2016, confirmed Mr. D was not medically fit to return to his job at that time. He stated that “after three to four months of ongoing therapy, hopefully, this will be improved enough that he will be able to return to work in a graduated fashion”. He also stated that Mr. D would benefit from a day program if received in a timely fashion, or alternatively “weekly to biweekly therapy for 10 to 14 sessions of a 60-minute duration”.

28The Employer suggested that there is no requirement for the insurer to follow the recommendations of an IME strictly, and that there should be some deference given to the insurer who has experience in developing rehabilitation plans.

29I don’t disagree with the general principle that an insurer is not bound to strictly follow the recommendations of any particular medical expert.

30However, where the insurer chooses to reject such recommendations and follow a different path, there should be a reasonable explanation as to why that advice is being rejected. In the present case, there is a complete absence of such. In the Claims Manager’s notes of the “Action Plan” there is reference to the medical recommendation the employee receive cognitive therapy prior to returning to work. However, there is no reference, and presumably therefore no consideration given, to the fact that there was also a recommendation for a certain amount of therapy before that happened. That is a critical factor which was simply ignored. The Claims Manager provides no explanation of how she concluded eight sessions of CBT were sufficient, or that in the midst of those sessions it was appropriate to expect Mr. D to commence a gradual return to work.

31The Employer submitted that the history of the file should be considered. Mr. D was advised by Dr. Tang-Wai in November 2016 that he should obtain the cognitive behavioural treatment, but he failed to obtain any such treatment for months. It was highlighted to me that there is no obligation on Manulife to provide treatment. The Employer suggested that should be considered in evaluating Manulife’s decision in determining the rehabilitation plan.

32I do not find that history relevant, given the basis of Manulife’s decision to terminate benefits. They did not terminate Mr. D’s benefits in July 2017 because of his failure to obtain treatment for months. They terminated it because he did not comply with the rehabilitation plan required by them.

33Where the rehabilitation plan required by Manulife is arbitrary, denial of benefits on the basis of a failure to comply with such a plan is not justified.

IV. DISPOSITION

34The appeal is allowed. I find Manulife’s decision to terminate benefits on July 31, 2017 was not in compliance with the collective agreement.

35As agreed by the parties, I remit the matter of remedy back to them to discuss. However, I remain seized.

Dated at Toronto, Ontario this 9^th day of November 2017.

SCHEDULE 1

APPENDIX 4

JOINT INSURANCE BENEFITS REVIEW COMMITTEE

Joint Insurance Benefits Review Committee

(1) Name of Committee

The Committee shall be referred to as the Joint Insurance Benefits Review Committee.

(2) Purpose of Committee

The purpose of this Committee is to facilitate communications between the Employer and the OPSEU on the subject of Group Insurance, including Basic Life Insurance, Supplementary Life Insurance, Extended Health Insurance, Long Term Income Protection Insurance, and such other negotiated benefits as may, from time to time, be included in the Group Insurance Plan.

It is understood that the Group Insurance benefits to be provided to employees and the cost sharing arrangements between the Employer and its employees shall be as set out in any applicable collective agreement or arbitration award, and the matters for consideration by this Committee shall be only as set out in these terms of reference.

(3) Composition of Committee

The Committee shall be composed of an equal number of representatives from the Employer and from the OPSEU, with not more than eight (8) representatives in total. At meetings of the Committee, each party may be accompanied by an Actuary to provide technical advice and counsel.

(4) Duties of Committee

The duties of the Committee shall consist of the following:

(i) Development of the specifications for the public tendering of any negotiated benefits which may be included in the Group Insurance Plan (to cover the bargaining unit only);

(ii) Determination of the manner in which the specifications will be made available for public tendering;

(iii) Consideration and examination of all tenders submitted in response to the specifications for tender and preparation of a report thereon;

(iv) Recommendation to the Government of Ontario on the selection of the

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insurance carrier or carriers to underwrite the Group Insurance Plans:

(v) Review of the semi-annual financial reports on the Group Insurance Plan; and

(vi) Review of contentious claims and recommendations thereon, when such claim problems have not been resolved through the existing administrative procedures.

The specifications for tender will describe the benefits to be provided, the cost sharing arrangement between the Employer and its employees, the past financial history of the insurance plans, the employee data, the format for the retention illustration for each coverage and the financial reporting requirements. Tenders shall be entertained by the Committee from any individual insurance carrier acting solely on its own behalf. This shall not preclude such carrier from arranging reinsurance as may be necessary.

The basis for recommendation of an insurance carrier(s) will include the ability of the carrier(s) to underwrite the plan, compliance of the carrier's quotation with the specifications for tender, the carrier's service capabilities and the expected long term net cost of the benefits to be provided.

(5) Experience Review

The Committee will also meet every six (6) months to review the financial experience under these coverages. The specifications for tender will describe the information to be included in the semi-annual financial statements to be prepared by the insurance carrier(s). These statements will include paid premiums, paid claims, changes in reserve requirements for open and for unreported claims, incurred claims, the retention elements of commissions, taxes, administrative expenses, contingency reserve charges and interest credits on claim and other reserves. The insurance carrier(s) will also be required to report on the level and method of administering the Employer's and employees' deposit accounts.

The Committee shall request the insurance carrier(s) to provide such additional information for the Committee's consideration as may be required by either the Employer or the OPSEU.

If the Joint Insurance Benefits Review Committee fails to agree on a recommendation to the Government of Ontario on the selection of the insurance carrier(s) to underwrite the group insurance plan, the members of the said Committee nominated by the Employer and the OPSEU may each make a recommendation in writing to the Government of Ontario on the selection of the insurance carrier(s) supported by reasons for their respective recommendations.

It is understood that the Government at all times retains the right to select whatever carrier(s) (to underwrite the Group Insurance Plan) it may consider would best

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serve the "public interest” and, in so doing, is under no obligation to select a carrier(s) that may be recommended by the Joint Insurance Benefits Review Committee.

(6) Claims Review Subcommittee

(a) There shall be a subcommittee whose mandate is to review, and make decisions on complaints or differences involving the denial of insured benefits under the Central Collective Agreement, when such issues have not been resolved through the existing administrative procedures, save and except a complaint or difference arising under Article 22.9.1 (Insured Benefits Grievance) of the Central Collective Agreement. The subcommittee shall be composed of two (2) representatives selected by the Employer, two (2) representatives selected by OPSEU, and an independent third party who is agreed to by both parties.

(b) Appropriate impartial medical consultants shall be available to the subcommittee in an advisory capacity to provide information on the nature of specific illnesses or disabilities.

(c) Membership on the subcommittee shall be for a one ( I ) year period, and is renewable at the discretion of the nominating party, or parties in the case of the renewal of the term of the independent third party.

(d) Decisions of the subcommittee are final and binding.

(e) The fees and expenses of the medical consultants referred to in clause (b), and the independent third party referred to in clause (a), shall be divided equally between the Employer and the Union.

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SCHEDULE 2

JIBRC CLAIMS REVIEW SUBCOMMITTEE

TERMS OF REFERENCE

AUTHORITY:

The JIBRC subcommittee is established under Article 22.9.2 and Appendix 4 of the collective agreement between The Crown in Right of Ontario and the Ontario Public Service Employees Union.

PURPOSE OF SUBCOMMITTEE

To review and make decisions on appeals from employees on claims involving the denial of insured benefits under the collective agreement which have previously been removed from JIBRC.

REFERRAL TO THE SUBCOMMlTTEE

Employees with claims that have been removed from JIBRC will be notified of such, in a timely, manner by letter (referred to as the "Notice Letter") to their last known address.

An employee whose claim has been removed, has 45 days, from the date of the notice letter, to submit a request in writing to OPSEU asking that OPSEU refer their case to the subcommittee. This letter must be copied to the Management Co-Chair of the JIBRC.

OPSEU has 90 days from the date of the notice letter to advise the Management Co-Chair of JIBRC of their decision to agree or deny the request to appeal. If notice is not received from OPSEU within 90 days from the notice letter then the claim will be deemed to be withdrawn.

SCOPE OF SUBCOMMITTEE

The Subcommittee represents the final stage in the appeal process.

The Subcommittee will clarify medical evidence as needed, with a medical consultant agreed to by both MBS and OPSEU.

Decisions of the Subcommittee are final and binding.

Upon receipt of the decision, a Memorandum of Settlement (as attached) will be prepared and signed by the parties and forwarded to the insurer.

SUBCOMMITTEE MEMBERSHIP:

The subcommittee will consist of resource representatives from OPSEU and MBS and an independent third party "Chair" to be named by MBS and OPSEU.

ROLE OF THE CHAIR:

To review case representations from MBS and OPSEU.

To make a determination in writing with respect to each case. Decisions must be in accordance with the OPS Collective Agreement between the Employer and OPSEU and consistent with the group insurance plans in place at the time the facts giving rise to the dispute arose.

ROLE OF MEDICAL CONSULTANTS:

Appropriate impartial medical consultants will be agreed by the parties and shall be available to the Subcommittee in an advisory capacity. If the parties cannot agree on a medical consultant, the Chair may call on a consultant from a roster supplied by the College of Physicians and Surgeons.

The medical consultants will provide information on the nature of specific illnesses or disabilities.

The Chair may request an interpretation of medical reports, test results and other medical documentation on file.

The medical consultant is not a member of the committee and will not provide an opinion related to a decision on the appeal.

FEES:

Fees and expenses, as approved by the parties, of medical consultants and the Chair shall be divided equally between MBS and OPSEU.

FORMAT OF MEETINGS:

Each appeal will be dealt with separately.

Both parties, through their representatives will provide, full disclosure of the supporting documentation upon which they intend to rely. This disclosure will take place at least two weeks in advance of the meeting of the subcommittee dealing with the subject matter of the appeal.

If the Chair requires clarification of medical evidence, a meeting of the Subcommittee will be arranged with a medical consultant agreed to by both MBS and OPSEU, or failing such agreement, with the medical consultant called by the Chair.

MBS and OPSEU will jointly present a statement of agreed upon facts (to the extent possible) for the appeal to the Chair.

Aside from the impartial medical consultant discussed above, no other witness will be called, except by request of the Chair. However, the individual claimant will be allowed to file a written statement in lieu of testifying. If the individual claimant chooses to file a statement it must be provided to the Management Co-Chair of JIBRC at the same time as OPSEU's request for appeal. MBS has the right to introduce a written response to this statement.

OPSEU will present its position on the case with supporting arguments to the Chair. MBS will present its position on the case with supporting arguments to the Chair and will respond to OPSEU’s position. OPSEU will have right of reply. Presentation by both parties will be based upon the information/record on file before the insurance carrier at the time the matter is removed from the JIBRC, the employee statement if any and MBS's response to the statement.

Either party may, if necessary request the attendance of the claimant, who shall be allowed a leave of absence without pay, with no loss of credits, to attend the sub-committee meeting as an observer only.

The Chair will render a written decision with supporting rationale.

FREQUENCY OF MEETINGS:

On an as needed basis as determined by MBS and OPSEU jointly.

The parties agree to these Terms of Reference in support of the implementation of Article 22.9.2 and Appendix 4 of the collective agreement.

Signed in Toronto this 20^th day of July, 1999.

“Elizabeth McKnight” “Leah Casselman”

For the Employer For the Union

Joint Insurance Benefits Review Committee - Claims Review Subcommittee

Addendum to the Terms of Reference dated July 20, 1999

The Parties agree to admit information submitted after an appeal for insured benefits has been removed from the JIBRC on the following terms:

1. The information was submitted to and decided upon by the insurance carrier prior to the date of the last Notice letter sent to the claimant following the removal from JIBRC.

2. In all other respects the information is to be treated in accordance with the Terms of Reference, including the mutual disclosure obligation and the manner in which the information is provided to the Chair.

3. The Parties explicitly reserve the right to make arguments before the Chair as to the proper interpretation and significance of the information submitted.

4. Either Party may terminate this agreement on 21 days notice. In the event that this agreement is terminated either Party may request Chair Briggs' verbal ruling on the admissibility of evidence be issued in writing.

“Robin Gordon” September 6/00

For the Union date

“Jennifer Evans” September 7/00

For the Employer date