Terminating benefits at age 65 is unconstitutional, says rights tribunal

  • February 04, 2019
  • Terra Klinck and Nicolas Guadagnolo

A 2018 interim decision of the Human Rights Tribunal of Ontario in Talos v Grand Erie District School Board saw the tribunal refuse to enforce the exception in the Human Rights Code  that permits employers to terminate benefit coverage for active employees at age 65 on the basis that the provision offended the equality guarantee under the Charter. 


Mr. Talos had his employer-sponsored group benefits terminated following his 65th birthday.  He filed an application with the human rights tribunal seeking $160,000 for lost benefits and compensation for injuries due to discrimination in employment on the basis of age.

The legal framework

Section 5 of the Human Rights Code provides that every person has a right to equal treatment with respect to employment without discrimination because of age.  Section 25(2.1) of the Code provides that pension and benefit plans that differentiate between workers based on age do not violate s. 5 of the Code provided that such plans comply with the Employment Standards Act, 2000 and its regulations.  Section 44 of the ESA provides that an employer shall not provide a benefit plan that treats employees and dependents differently because of the age except as permitted under the regulations.  Section 1 of Regulation 286/01 (often referred to as the “Benefits Regulation”) defines age as “any age of 18 years or more and less than 65 years”.

Based on this statutory scheme, the tribunal initially ruled that Mr. Talos’ complaint could not succeed.  This prompted Mr. Talos to argue that s. 25(2.1) of the Code was invalid and unenforceable as it was an unjustifiable breach of his equality rights under the Charter.

Arguments and decision

Section 15(1) of the Charter

The tribunal first considered whether s. 25(2.1) of the Code breached s. 15(1) of the Charter which provides that “every individual… has the right to the equal protection and equal benefit of the law… without discrimination based on… age.” 

To establish a breach of s. 15(1), an individual must first show that a law draws a distinction based on an enumerated ground, and then demonstrate that the distinction is discriminatory because it has the effect of reinforcing, perpetuating or exacerbating disadvantage.  Mr. Talos asserted that s. 25(2.1) of the Code disadvantaged older workers.  The Ontario Human Rights Commission intervened and argued that s. 25(2.1) of the Code created an overly broad exclusion from s. 5 of the Code for benefit plans.  Several other university faculty and school teacher unions intervened to support and supplement the arguments made by Mr. Talos and the Commission.

The employer argued that the decrease in workers’ benefit coverage at age 65 was a direct result of the collective bargaining process. Mr. Talos’ union chose not to pursue benefits for workers post age 65 when faced with the employer’s request for a concession regarding employees’ workloads.  The employer also argued that Mr. Talos did not in fact experience discrimination when his benefits were terminated.  Finally, the employer asserted that there was a social consensus that people would retire at age 65 and start relying on government-supported benefit programs.  The Attorney General of Ontario intervened in interest with the employer.  Both relied on Withler v Canada (Attorney General).  In Withler, the Supreme Court of Canada considered the legality of a supplementary death benefit which decreased by a certain amount for each year by which the deceased plan member exceeded a particular age.  The Supreme Court determined that the supplementary death benefit was but one component in a larger suite of benefits, the components of which were sufficiently equivalent in value as between older and younger survivors.    

The tribunal rejected all of the arguments made by both the Attorney General and the employer.  It concluded that s. 25(2.1) of the Code drew a distinction based on age which resulted in a disadvantage for those age 65 or older, including lost peace of mind, additional financial outlays, and the requirement to be means-tested to access benefits from the government that were previously enjoyed by virtue of employment.  The tribunal distinguished Withler on the basis that the employer failed to provide any offset for the benefits it took away from Mr. Talos when he reached age 65. 

Section 1 of the Charter

After determining that s. 25(2.1) of the Code breached s. 15(1) of the Charter, the tribunal went on to consider whether the breach could be justified under section 1.   

It found that s. 25(2.1) of the Code was rationally connected to the legislature’s pressing goal of preserving the financial viability of workplace benefit plans when it was enacted coincident with the abolition of mandatory retirement in 2006.  However, the scope and degree of the impairment were unacceptable as little-to-no empirical evidence was available to demonstrate that age-based distinctions in respect of workers over age 65 were necessary to maintain the financial viability of workplace benefit plans.  The tribunal accepted evidence that the cost of dental insurance remained static with age and that it was not cost-prohibitive to offer extended healthcare coverage until age 79.  In summary, the tribunal concluded that steps could be taken to manage benefit plans such that the average per-member cost remained consistent pre- and post-age 65.  It also contrasted s. 25(2.1) of the Code with legislation in other provinces and found that less impairing alternatives were available.

The tribunal did not have jurisdiction to declare s. 25(2.1) of the Code invalid.  Rather, this interim decision allowed the tribunal to refrain from applying s. 25(2.1) of the Code as a bar to Mr. Talos’ application on its merits (and which has not been publicly resolved to date). 

Terra Klinck and Nicolas Guadagnolo practice pension, benefits and executive compensation law at BMKP Law.