We have the next chapter in the case involving Okanagan College and the Okanagan Faculty Association. As I noted in my last insight post, in an arbitration between Okanagan College and the Okanagan Faculty Association, the arbitrator held that cessation of long-term disability benefit coverage for employees who have reached age 65 was not “bona fide” as that term is used in the BC Human Rights Code (“Code”). The employer sought a review of that decision under the Labour Relations Code, and on February 9, 2026, the Labour Relations Board issued its decision, overturning the arbitrator’s decision. Having concluded that the employer’s plan was in fact bona fide, the matter is being sent back to the arbitrator to consider whether the exception in the Code (which allows a bona fide plan to discriminate on the basis of age) is itself contrary to the guarantee of equality enshrined in section 15 of the Charter.
The focus of the Board’s decision was on how the arbitrator interpreted and applied the Supreme Court of Canada case of New Brunswick (Human Rights Commission) v. Potash Corporation of Saskatchewan Inc. (“Potash”). At issue in Potash was language very similar to the bona fide test in the British Columbia Code. In interpreting what is meant by “bona fide” the majority of the Supreme Court of Canada held that the appropriate legal test is to ask whether the plan “was adopted honestly, in the interest of sound and accepted business practice and not for the purpose of defeating the rights protected under the Code”. Specifically and importantly, the Court in Potash rejected the notion that to be bona fide, a plan had to be “reasonable and bona fide”. While there was a minority decision in Potash, it is the majority decision that is binding.
The Board described its role as to determine whether “the analysis in the [arbitrator’s decision] is underpinned by a correct understanding and application” of the bona fide test in the Code. Ultimately, the Board determined that the arbitrator failed to follow the decision of the majority in the Potash decision and instead preferred the reasons articulated by the minority. Specifically, the Board held that the arbitrator’s award reflected the minority analysis in Potash because:
It considered the reasonableness of the employer’s reliance on financial considerations in maintaining the existing age-based limitations in the plan;
It considered the extent of the financial impact of extending the benefits past age 65 including drawing conclusions about the significance of those cost implications; and
It balanced the increase in costs against the statutory objectives of the Code and the bona fide exemption in particular.
The Board also noted that, in framing the analysis, the arbitrator “argued it was time to take a 'fresh look' at Potash.” However, the Board notes that “it was not the Arbitrator’s role to rethink or revise the Potash test.”
The Board determined that it did not have to send the matter back to the arbitrator, that the Board was capable of determining whether the employer’s plan (which terminated coverage for disability benefits at age 65) was “bona fide” under the Code. The Board was comfortable that it had the information to enable it to make a decision, and it held that the employer’s plan is, in fact, bona fide under the Code.
There are 2 next steps:
First, the Board did send back to the arbitrator the question of whether the Code itself (the exemption for a bona fide plan) violates the equality guarantee provided by section 15 of the Charter. Therefore, we will have to wait for the arbitrator’s assessment of whether the Code itself violates section 15 of the Charter.
Second, we do not know whether the Okanagan Faculty Association will take further steps to review the Board’s decision and whether other interested parties will intervene in any such applications.
We will wait for the next chapter in the Okanagan College case, but for many plan sponsors, the Board’s decision is welcome relief about how the Potash case will be interpreted and applied.