A B.C. court has ruled that a key section of the province’s Workers Compensation Act (WCA) unfairly denies benefits to certain workers with chronic mental disorders.
In a detailed decision, the court upheld the higher causation threshold used for chronic mental stress claims but called into question a portion of the legislation known as the “labour relations exclusion,” deeming it overly broad and contrary to equality rights.
The ruling centres on an action by M.P., who sought benefits under the WCA after developing disabling stress at work. M.P. alleged that chronic bullying and harassment by a co-worker, compounded by a manager’s failure to address those issues, caused him to suffer serious mental health problems requiring medical leave.
When M.P. filed a compensation claim, the Workers’ Compensation Board (WCB) ultimately rejected it, a decision later affirmed by the Workers’ Compensation Appeal Tribunal (WCAT).
Although the WCAT agreed M.P. was bullied and that his mental disorder arose from work, it concluded the “predominant cause” of his condition was the employer’s decision-making around how — or whether — to deal with the conduct, rather than the harassment itself.
Because the WCA excludes compensation for mental disorders stemming from “a decision of the worker’s employer relating to the worker’s employment,” the claim was denied.
Constitutional challenge
M.P. then launched a constitutional challenge. He argued that two parts of the WCA discriminated against people with chronic mental disorders, contrary to section 15 of the Canadian Charter of Rights and Freedoms.
First, he took issue with the “predominant cause” test in section 135(1)(a)(ii), which requires that work-related factors be the single largest cause of a chronic mental disorder. By contrast, claimants with physical injuries typically need only show that workplace factors were of “causative significance,” a lower threshold.
Second, M.P. argued that the “labour relations exclusion” in section 135(1)(c) unfairly bars compensation for chronic stress if caused by any employer decision—regardless of whether the decision is made in good faith or is related to legitimate workplace processes.
In its analysis, the court recognized that the WCA distinguishes chronic mental stress claims from physical and trauma-related claims by applying what M.P. described as an “elevated standard.” Section 135(1)(a)(ii) was added several years ago to expand eligibility for mental disorder claims beyond sudden, traumatic events. While it widened coverage to include chronic mental stress, it did so under the stricter “predominant cause” test. M.P. argued this distinction was both arbitrary and discriminatory.
Higher threshold for mental health
The court disagreed. It considered expert evidence on the complexities of adjudicating chronic mental disorder claims. One expert explained that chronic stress arises from “multifactorial” influences — genetics, early life experiences, and personal circumstances — making it difficult to pinpoint the precise impact of workplace factors.
According to that testimony, a higher threshold can help ensure only genuinely work-related mental disorders qualify for compensation. The court accepted this rationale, noting that the “predominant cause” standard is not the same as a “more than 50 per cent” requirement. Rather, it allows claims if work-related stressors are identified as the single most important factor among several causes, even when each factor contributes less than half the total share.
Labour relations exclusion
Turning to the “labour relations exclusion,” however, the court found that section 135(1)(c) sweeps too broadly. While government representatives argued the exclusion protects an employer’s ability to manage workers without liability for common job-related stress (such as discipline or reorganizing workloads), the court decided the blanket exclusion goes much further than necessary.
It observed that M.P.’s unaddressed harassment was “predominantly caused” by the employer’s ineffective approach — a management decision — yet that same decision triggered the exclusion, shutting M.P. out of compensation despite a clear link between his condition and the work environment.
Calling the exclusion arbitrary, the court emphasized that workers whose mental disorders are traceable to bad-faith or unreasonable management decisions deserve a fair adjudication process, especially when the same stressors would be compensable if they were classified differently.
The provision “is not limited to management decisions on generic processes and actions taken in good faith,” the court wrote. It therefore ruled that the “labour relations exclusion” must be narrowed — or “read down” — to cover only bona fide and good-faith decisions. When employer decisions involve acts or omissions that stray outside legitimate managerial conduct, the resulting chronic stress must not be summarily excluded.
Remedy
As a remedy, the court sent M.P.’s claim back for reconsideration under a properly constrained “labour relations exclusion.” By reading down section 135(1)(c), decision-makers will no longer be able to label any employer action as an unassailable “decision,” thereby denying valid claims. Meanwhile, the “predominant cause” requirement remains intact. The court concluded that this higher standard is justified for chronic stress claims, given their distinct and multifactorial nature.
For human resources and legal practitioners, the decision clarifies that while boards and tribunals may continue applying a stricter test for chronic mental disorder claims, employer conduct is not immune from scrutiny simply because it involves managerial decisions. If an action — like refusing to act on reports of bullying — causes or worsens a worker’s disabling mental disorder, blanket exclusions will no longer stand.
Although the court preserved the “predominant cause” test, its requirement to read down the “labour relations exclusion” signals a significant shift. Going forward, the WCB and associated tribunals must account for whether an employer’s decision was genuinely tied to good-faith labour relations or was effectively mismanagement. The result widens the pathway for chronic mental stress claims rooted in employer inaction or poor faith responses to harassment.
For more information, see Pickering v Workers’ Compensation Board, 2025 BCSC 376 (CanLII).
