Appeal court increased fine to better reflect corporation's 'size and economic scope'
The Ontario Court of Appeal has revised the sentence for a Dairy Queen franchise following an incident in which a teenage employee suffered a serious spinal injury. The court increased the fine imposed on the franchise after finding errors in the lower courts’ consideration of the appropriate penalty under the province’s Occupational Health and Safety Act (OHSA).
In September 2017, a 16-year-old high school student was working at the Embrun Grill & Chill, a Dairy Queen franchise in Embrun, Ont. She was using the restaurant’s Blizzard machine to mix ice cream with the ingredients when she turned to ask a co-worker a question about upcoming orders on the board.
She took her foot of the machine’s pedal, but her hair got caught in the spindle, which hadn’t yet stopped rotating. The worker stepped back towards the machine and accidentally hit the pedal, which started the spindle rotating again and pulled her in.
The worker and another employee heard a loud cracking sound in her neck and the other employee rushed to get the shift leader. Together, they untangled the worker’s hair from the spindle, but she was stuck in the machine for seven minutes.
The injury was a subluxation to the worker’s C1 and C2 vertabrae and required hospitalization for two weeks. The worker had to wear a neck brace and stay on bedrest for some time, and she couldn’t attend school for one semester, having to complete courses online. She also suffered long-term effects such as numbness, headaches, and limited activity.
No safety training at Dairy Queen
The worker wasn’t provided with training on machine safety, and the machine's plastic safety guard had been removed by the shift leader to expedite service – this was apparently common practice in the restaurant during busy periods. Early in the worker’s employment, she had asked why some employees didn’t use the guard and she was told that she wasn’t required to use it.
Dairy Queen’s employee handbook and the machine’s operating manual addressed machine guarding and other health and safety issues, but the worker hadn’t received a copy or seen either in the workplace.
The Ontario Court of Justice initially imposed a $7,500 fine on the Dairy Queen franchise, but the Crown appealed, arguing that the sentence failed to consider the corporation's size and economic scope and seeking a $75,000 fine. A judge of the Ontario Court of Justice dismissed the appeal and the Crown appealed to the Ontario Court of Appeal.
The Court of Appeal found that the lower courts had erred by restricting the consideration of the company’s size to the local franchise operation where the incident occurred. The appellate court emphasized that in cases involving corporate defendants, the size and economic means of the entire corporation must be considered to ensure that the penalty serves as an effective deterrent. In this case, the corporate defendant operated seven Dairy Queen restaurants with 84 full-time equivalent employees.
Higher fines for corporate offenders
The court also addressed the improper application of sentencing parity between individual and corporate offenders. It clarified that the higher maximum fines available for corporations reflect the need for more substantial penalties to achieve deterrence, given the typically greater economic resources of corporate entities.
In concluding that a $40,000 fine, plus the victim surcharge, was appropriate, the Court of Appeal noted that this amount better reflected the seriousness of the offence and the need for deterrence, while being consistent with fines imposed in similar cases involving corporate defendants.
The fine addressed the failure to maintain proper safety practices, which led to the significant injury of a young employee, while taking into account that the corporate respondent had no prior charges under the OHSA or a history of non-compliance with occupational health and safety requirements.
