Does the Workers’ Compensation Act Immunize Hospitals Against Medical Malpractice Claims?

by John McKiggan

As a Halifax medical malpractice lawyer I frequently get calls from other lawyers who don’t practice this area of law, wondering if their client has a potential medical malpractice claim.

This week I got a call from a colleague of mine, and since his question is one I have been asked many times over the years, I thought it would be helpful to post some information here in case it is helpful to anyone else in the same circumstances.

Work Injury Leads to Negligence in Medical Treatment

The situation was this: The client suffered a back injury at work. He was covered for the injury by Workers Compensation. He was referred for back surgery to treat his injury. The client claimed the treatment her received in the hospital was negligent and actually made his back injury worse. He wanted to know if he could sue the doctor for medical malpractice.

Workers Compensation Law Bars Lawsuits

The first thing non-lawyers have to know is that there is a statutory bar in the Workers’ Compensation Act that says an injured worker is not allowed to sue their employer (if they are covered by WCB). Basically in exchange for the automatic (no-fault) benefits workers get under Workers Compensation, the worker gives up the right to be able to sue.

Not Just Your Employer

What most workers don’t realize is that the bar to filing a lawsuit also applies to any other employee or employer covered by WCB.

Are Hospitals Employers Under WCB?

So the question is: “Are who treat patients considered to be employers as defined by the Workers Compensation Act?”

The answer is a little ironic.

Hospitals (Usually) Not Doctors Employers

It is well established in Canadian law that Hospitals (usually) cannot be sued for the negligent acts of doctors who have privileges at the hospitals. Doctors are (usually) considered to be “independent contractors” not employees. Hospitals (usually) will not be held responsible (the legal term is “vicariously liable”) for a doctor’s negligent conduct.

[I qualify these statements with the word “usually” because every case depends on it’s own facts and there can be exceptions to every rule. Which is why if you have a question about medical malpractice claims, you should hire an experienced medical malpractice lawyer.]

In cases where WCB claims have been involved, there is a line of authority that says Hospitals are employers and therefore they are immune from being sued EVEN IF THEY WERE NEGLIGENT IN THEIR TREATMENT!

An Example From N.S.

The Nova Scotia Court of Appeal dealt with this issue in Queen Elizabeth II Health Sciences Centre v. Nova Scotia (Workers’ Compensation Appeals Tribunal) In that case the plaintiff, Mr. Erl, was injured at work and received workers’ compensation. He claimed the medical treatment he received was negligent and caused further injuries.

Mr. Erl wished to sue the hospital and the doctors involved. The issue for the Court of Appeal to decide was whether the hospital was an employer subject to the Workers’ Compensation Act and therefore the civil action would be barred.

The Court’s analysis begins by noting the premise set out by Sopinka, J. at the Supreme Court of Canada:

[34] “The bar of civil actions is a central feature of the workers’ compensation system and one that is fundamental to its integrity.”

The argument was made that since the doctors that treated Mr. Erl were not considered to be employees under the WCB then the hospital could not be considered to be an employer.

The Court of Appeal said:

“An employer may have servants and agents who are not workers covered by the Act but that does not mean that their employer is not subject to the Act.”

The Court of Appeal ultimately concluded that the hospital was clearly an employer under the act, evidenced by their nearly $4 million payment in assessments under the Act. Therefore, the civil action was barred.

Board Follows Decision of NSCA

The Court of Appeal’s reasoning was followed in a Nova Scotia Workers’ Compensation Appeals Tribunal decision from February of this year.

An employee, Kelly McKnight, was injured during the course of her employment. Kelly sought to recover in tort law for the losses not covered by her workers’ compensation (i.e. persistent pain, loss of enjoyment of recreational activities, etc.). The tribunal asserted that Kelly was a covered worker and the defendants in the action were covered employers and therefore her actions were barred by s.28 of the Act.

Are Non-Workers Claims Barred?

Kelly’s husband, Lloyd McKnight, was recovering from surgery and was physically impaired when Kelly suffered her injury. Lloyd suffered from the loss of her assistance. Mr. McKnight was not an employee or employer as defined in the Act.

The tribunal assessed whether Lloyd would be barred from recovery by citing the Queen Elizabeth II Health Sciences Centre decision.

The tribunal found:

“It follows from this analysis that s. 28 has a dual effect: for covered workers, it presents a potential bar to action against any covered employer; for a covered employer, it offers a potential shield to an action arising from any covered worker’s injury… Even though Mr. Erl was not a worker employed by the hospital, he could not sue the hospital. The Court implicitly found that the hospital was immune from suit by any covered worker, employed by any employer, so long as the action was grounded in a compensable injury.”

Is This Fair?

If you have been injured because of someones negligence, you might think it is unfair that the Workers Compensation Act potentially takes away your right to sue for compensation.

The justification for this line of law is that Workers’ Compensation is a no-fault system. Employers pay into the Workers Compensation program and workers are able to recover for their injuries without having to prove liability or having to bear the expenses and lengthy time requirements for litigation.

The trade-off is that there is a statutory bar preventing injured workers from seeking compensation for their pain and suffering, etc.

Is this fair? Should hospitals be protected from law suits when they or their employees have provided negligent treatment? What do you think?

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