What the Binance Decision Means for Ontario Workplace Safety Investigations

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Quick Hits

• Regulatory inspections and investigations under Ontario’s Occupational Health and Safety Act (OHSA) take several forms, including proactive and reactive visits by Ministry of Labour, Immigration, Training and Skills Development (MOL) inspectors who are empowered to enforce compliance with the OHSA and protect worker health and safety.
• MOL inspectors have broad enforcement powers, including entering a workplace without a warrant or prior notice.
• Beyond the obligations established by the OHSA on employers while the MOL exercises its enforcement powers, there are important additional steps for employers to consider depending on the purpose and depth of the inquiry, including whether the investigation is a result of a critical injury or fatality in the workplace.

• In Binance, the Ontario Court of Appeal ruled that the OSC summons were overbroad and violated s. 8 of the Canadian Charter of Rights and Freedoms because it required the company to produce documents that OSC had no foundation to believe may be relevant to an investigation it was conducting.
• The analysis in Binance provides a framework for employers to push back on overly broad production demands by regulatory bodies.

Occupational Health and Safety Regulatory Scheme in Ontario

Regulatory inspections and investigations under Ontario’s Occupational Health and Safety Act (OHSA) take several forms—such as proactive inspections, complaint-driven inquiries, and post-incident reviews—all carried out by Ministry of Labour, Immigration, Training and Skills Development (MOL) inspectors who are empowered to enforce compliance with the OHSA and protect worker health and safety.

To carry out these functions, inspectors are vested with broad statutory powers, including the following:

• Inspectors may, among other things, enter any workplace at any time without a warrant or prior notice, question any person relevant to an investigation, seize and copy documents and records, test equipment and machinery, take photographs and require that a workplace remain undisturbed for a reasonable period.
• Where there are reasonable grounds to believe an offence has been committed, inspectors may also obtain investigative warrants from a justice of the peace or provincial judge authorizing the inspector to use any investigative technique or procedure or to do anything described in the warrant.
• In exigent circumstances, an inspector may exercise seizure powers without a warrant.

The OHSA establishes obligations on workplace parties while the MOL exercises its enforcement powers. For example, employers, among other parties, are required to co-operate with inspectors, and obstructing, hindering or providing false information to an inspector is itself an offence under the OHSA. Beyond the obligations established by the OHSA, there are important additional steps for employers to consider depending on the purpose and depth of the inquiry, such as whether the investigation is a result of a critical injury or fatality in the workplace.

Ontario Court of Appeal’s Decision

In Binance Holdings Limited, the Court of Appeal for Ontario considered a challenge to an investigative summons issued under the Securities Act. The OSC under section 13 of the Securities Act issued a broadly framed summons compelling Binance to produce documents and communications. Binance sought to challenge the summons on constitutional and statutory grounds.

On the merits, the court determined that section 8 of the Charter applied because an enforceable demand for production of business records is a seizure. Binance was entitled to protect the modest but reasonable expectation of privacy it has in its business documents from unreasonable seizure. Section 8 requires that compelled production be reasonable. The court affirmed that, even in the regulatory context, compelled production must be tied to the inquiry in progress. Regulatory bodies can compel documents that “may be relevant” to its inquiries, but those requests must not be broader than necessary for a “fishing expedition.”

The court stated that,

“… it only stands to reason that to be reasonable, a seizure must be related to the purpose for which the power of compulsion was created, and that if there is no realistic foundation for believing the target documents will be relevant to that inquiry, the seizure is not needed to facilitate a proper inquiry and is improper.”

Applying that standard, the court found the Binance summons unconstitutionally overbroad. In particular, a demand for “all communications” over a multiyear period among a wide array of individuals at Binance and its related entities, concerning Ontario or Canada generally, went far beyond any reasonable relevance to the stated investigation, amounting to an impermissible fishing expedition. The court set the summons aside and ordered the return of seized documents produced due to the invalid summons.

Relevance to Ontario’s Occupational Health and Safety Act

This decision provides a framework for employers responding to broad investigative demands from regulatory bodies such as the MOL, while recognizing the realities of the regulatory context.

First, scope and relevance constraints apply to compelled production in regulatory investigations. Although OHSA investigations also engage a reduced privacy expectation and may proceed without criminal law thresholds, section 8 still restricts compelled production to categories that may reasonably be relevant to the inquiry in progress. Overbroad demands untethered to the stated purpose risk being unreasonable and unconstitutional. Where an inspector’s demand or order sweeps in “all communications” or large classes of records without tailoring the demand, this decision supports insisting on narrower categories reasonably connected to the articulated safety inquiry, time period, individuals, and subject matter.

Second, regulators cannot justify fishing expeditions based on speculative relevance or generalized compliance concerns. The court rejected the argument that a regulatory body cannot know if a document is relevant without seeing it. For OHSA, that means MOL demands should delineate why the categories sought may bear on the incident, hazard, system, or alleged contravention under investigation.

The court’s insistence that administrative subpoenas or summonses be only as broad as necessary and targeted to what may be relevant provides employers a basis to resist unduly burdensome or unfocused demands, and if necessary, seek judicial intervention.

Ogletree Deakins’ Canada offices will continue to monitor developments and provide updates on the Canada, Cross-Border, and Workplace Safety and Health blogs as additional information becomes available.

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