October 17, 2007
21.4.947
Background
The employee grieved management's refusal to compensate for the financial hardship resulting from an incident on January 17, 2006, while he was on duty.
The grievor had a car accident involving a rental car which he was authorized to keep overnight at his home and the grievor's own vehicle in his driveway due to black ice. The rental company advised the grievor that there was no applicable insurance coverage to cover his claim for damages to his personal vehicle. As such, the grievor's personal insurance company covered damages. However, the grievor was required to pay the deductible ($500.00), as well, he was advised that his insurance premiums would increase by approximately $150.00 for the next seven years.
Bargaining Agent Presentation
The bargaining agent representative claimed the grievor would not have been in the unfortunate situation in the first place had he not been on government business. Similarly, it can be said that the department is essentially liable, not the grievor. To support this position, the bargaining agent stated the common law doctrine of ”respondeat superior”, which states an employer is liable for harms done by employees in the course of their employment. Under this doctrine, the employer becomes vicariously liable for the employees actions. This ensures employers are held accountable for damages an employee might be unable to pay for during the course of their employment.
The bargaining agent representative presented other possible accident scenarios which would have in fact been covered by the insurance. For example, had the grievor hit a neighbour's car, or another car other than his own, he would have been insured.
According to article 2.3 (b) and (c) Collision Damage Waiver/Loss Damage Waiver (CDW/LDW)of the PWGSC Terms and Conditions of the 2007 Car Rental Standing Offer, the rate insures the User with nil-deductible, against collision, loss, damage, fire, theft, vandalism, tire and glass damage and loss of use, with the only exception, not applicable in the grievor's case, is when the user has been charged and convicted of an indictable offense while using the rental vehicle. It is also stated that this option is covered by the designated travel card and employees are not required to opt for additional coverage.
The bargaining agent representative outlined the sections of the Travel Directive which apply to the present grievance. For example, the values of trust and flexibility were not upheld as the grievor trusted his employer to protect him while on government travel. The department has broken that trust and had not displayed any flexibility in treating this case, although they recognized the gap in the Directive. The Purpose and Scope states employees are not to be out of pocket and moreover, section 1.1.3 mentions that ”expenses resulting from misinterpretations or mistakes…shall be reviewed on a case by case basis.”
The bargaining agent representative emphasized that clause 2.2.4 of the Directive should be interpreted as applicable only when an employee is driving the car.
Lastly, the bargaining agent representative stressed that the overall principles of fairness and reasonable reliance should apply to this case, as it is reasonable for one to believe they are fully insured on government business travel, and that they would be treated fairly in any dealings with the government.
Departmental Presentation
The departmental representative explained that, despite the fact that the grievor's accident is unfortunate, there are no provisions in the Travel Directive that would compensate the grievor for the increase to his insurance premiums or the deductible that he had to pay. Section 2.2.3 states that travellers shall not be reimbursed for personal accident insurance coverage premiums. Further, section 2.2.4 of the TD specifically states that the employer is not responsible for reimbursing deductible amounts related to insurance coverage.
The department, by providing the grievor with the AMEX DTC, respected the intent of the Travel Directive by ensuring that the grievor would not be out of pocket for any expenses incurred for use of the rental car that he needed for government business travel. The department is not, however, responsible for the grievor's personal vehicle.
The departmental representative explained the AMEX DTC CDW/LDW insurance coverage only covers the rental car and does not extend to any other vehicle. Specifically, the CDW/LDW provided for on the AMEX DTC covered the grievor for theft or damage to the rental car up to the full value of the rental car. The insurance covers damage to or theft of the rental vehicle for which the grievor is liable, including collision, fire, vandalism and tire and glass damage. In addition, coverage also included theft or damage to the grievor's personal effects that were in the rental car. Therefore, even if the grievor had opted for the CDW/LDW offered by the rental car agency, only the rental vehicle would have been covered.
The Car Rental Theft and Damage Insurance and Car Rental Personal Effects Insurance Certificate also states that coverage does not extend to other vehicles which are not rental vehicles. This would include the grievor's own personal vehicle. So if the grievor hit another vehicle or object, the insurer for the AMEX DTC would only pay for the damage to the rental vehicle and no other damages.
Third Party Liability auto insurance is meant to compensate another person harmed or injured by a negligent or wrongful act or omission. When an insured person (the first party) causes harm to a third party, the insurer (the second party), assumes the insured's liability up to the policy limit.
In this case, the grievor is both the ”first party”, as the insured person, and the ”third party”, that is, the person whose property was damaged by the first party. In law, a person cannot bring an action against themselves.
The insurers for the rental car agency declined to pay the grievor's claim for his personal vehicle because under the Third Party Liability section of their insurance policy, the insurer is not liable for damage or loss to property owned or rented by the insured (the grievor).
If the grievor had hit a third party's car, the Government of Canada's third party liability coverage that is included in the rental rate of the rental car would have covered the damage to the third party's car and the rental company would have paid the claim.
Moreover, the departmental representative submitted, that the details of the grievor's personal auto insurance policy are out of the control of the department. Namely, the deductible and the premiums are determined by the company. Specifically, the insurance premiums are determined based on risk, where the insurance company uses a variety of factors such as the type of vehicle you drive, where you live, how you use your car to calculate insurance premiums.
The departmental representative claimed the department can not assume responsibility for the grievor's premiums as it has no proof that this particular accident led to the premium increase. It is quite possible that previous accidents that the grievor was involved in contributed to the premium increase. Neither the grievor's driving performance, nor his skills and abilities as a driver are within the control of the department.
It was the grievor's negligence that caused the accident, not the department's negligence. If the grievor's driveway was icy, he knew or ought to have known that the driveway posed a risk that could have caused an accident. The grievor is the owner of the property on which the accident occurred. As the property owner, he would have been liable for accidents occurring on his property due to the condition of the property.
In conclusion the departmental representative stressed the employee's personal vehicle and personal liability are not the responsibility of the department and the Travel Directive does not provide for the compensation sought by the employee, namely the deductible and insurance premiums increase.
Executive Committee Decision
The Executive Committee considered the Government Travel Committee report and could not come to a consensus on whether the grievor was treated within the intent of the Travel Directive. As such, the Committee reached an impasse.