Personal Injury

WSIB and motor vehicles: when are employers protected?

By Dale Orlando and Nicole Fielding

The Workplace Safety and Insurance Board (WSIB) is an Ontario government agency. Employers contribute to a province-wide insurance fund, from which injured workers may be compensated on a “no-fault” basis. In return for this compensation, however, the employer is shielded from any additional liability. This means that, in most cases, WSIB-registered employers are protected from civil lawsuits, and workers are limited to recovery through benefits under the workers’ compensation scheme.

However, there are situations in which this protection system becomes more complicated. One of these kinds of situations is where injuries involve the use of a motor vehicle owned by a WSIB schedule 1 or 2 employer.

Section 28(4) of the Workplace Safety and Insurance Act states that the protection against lawsuits for workplace injuries does not apply if any employer other than a worker’s employer supplied a motor vehicle, machinery or equipment on a purchase or rental basis, while also supplying workers to operate the motor vehicle, machinery or equipment.

Essentially, in the situation described by s. 28(4), an employer, regardless of their registration as a schedule 1 or 2 employer with WSIB, will be vulnerable to liability suits in cases where the vehicle they’ve supplied is involved in a motor vehicle collision.

A number of WSIAT decisions have offered some clarification on this issue. The most commonly referenced decision with regard to s. 28(4) of the Act is this one.

In the case, both the plaintiff and defendant were working as transport truck drivers for a numbered company, which was contracted to transport cargo for another numbered company. The transport truck that they were operating was owned by a leasing company, but leased to the employer. Following a collision, the plaintiff brought an action against the defendant (the driver at the time of the collision), as well as both numbered companies and the leasing company. An application was made to the Workplace Safety and Insurance Appeals Tribunal (WSIAT) on the basis that all parties were employees or employers, working in the course of their employment.

The WSIAT held that the defendant leasing company was not protected by WSIB insurance from a civil claim by the plaintiff. Even though the collision occurred while the plaintiff was in the course of his employment, the plaintiff was not employed by the leasing company at the time of the collision, and was, therefore, free to pursue a civil action against this defendant.

This decision still stands today and has been affirmed by other WSIAT decisions since.[1]

It is important to remember that these decisions stand in the context of s. 192(2) of the Highway Traffic Act, which places vicarious liability on a vehicle owner for damages caused by the driver if the owner gave consent for that driver to possess the vehicle.[2]

For more information on liability of vehicle owners renting or leasing their vehicles, check out our blog articles here, here, or here.

While WSIB protection can often be broad and beneficial for employers who register, it is also not all-reaching and all-encompassing, as depicted in the decisions noted above. Employers may wear different hats when acting as leasors of vehicles, or owners of property. It is therefore important that employers understand the extent of their coverage, and understand which scenarios will require different forms of insurance. This is critical, not only for the protection of employers in the face of potential liabilities but also in ensuring injured parties receive the care and compensation they require.

[1] See, for example, WSIAT Decision No. 1086/15, 2015 ONWSIAT 2107.

[2] RSO 1990, c H 8, s 192(2).

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