On July 10, 2020, the majority of the Supreme Court of Canada upheld sections 1 to 7 (the Challenged Provisions) of the Genetic Non-Discrimination Act (the Act) as constitutional in Reference re Genetic Non-Discrimination Act, 2020 SCC 17. In addition to amending the Canada Labour Code and Canadian Human Rights Act, the Act criminalizes compulsory genetic tests and forced disclosure of information from genetic tests for many activities. Although a federal act, its impact includes regulating contracts, particularly insurance contracts. As such, a key issue on appeal was whether the Challenged Provisions were within federal jurisdiction or whether they fell within provincial jurisdiction over property and civil rights. Ultimately, a narrow majority of five of nine Justices concluded that the Challenged Provisions had a valid criminal law purpose and were therefore intra vires federal authority.
Genetic test is defined in the Act as “a test that analyzes DNA, RNA or chromosomes for purposes such as the prediction of disease or vertical transmission risks, or monitoring, diagnosis or prognosis.”
The Act prohibits:
- Requiring an individual to undergo a genetic test as a condition of providing a good or service or entering into (or continuing) a contract;
- Forgoing the contract or the provision of goods and services if an individual refuses to undergo a genetic test or disclose the results of a genetic test; and
- Collecting, using, or disclosing an individual’s genetic test results without their written consent if in the course of a contract or the provision of goods and services.
Certain exemptions are listed in section 6 of the Act, particularly with respect to the use of genetic tests by health care practitioners and researchers. Further, and although not in issue before the Court, it is worth noting that the Act amends the Canada Labour Code, which now prohibits employers from mandating genetic tests or the disclosure of information from genetic tests, and the Canadian Human Rights Act, which now specifies that if an individual refuses to undergo a genetic test or disclose information from a genetic test, any resulting discrimination falls under a prohibited ground for discrimination – genetic characteristics.
Jurisdiction to enact the Act
The Supreme Court has long recognized that the division of powers is not always a clear divide. Rather, as recognized by the Supreme Court in Reference re Securities Act, 2011 SCC 66, “the modern view of federalism ‘accommodates overlapping jurisdiction and encourages intergovernmental cooperation’.”
The Supreme Court’s judgment comprised three sets of reasons:
- Majority concurring decisions written by Karakatsanis J. and Moldaver J. on behalf of three and two of the Justices, respectively; and
- Dissenting decision written by Kasirer J. on behalf of four Justices.
As noted, the majority found that the Challenged Provisions had a valid criminal law purpose. At paragraph 4, Karakatsanis J. concluded that the pith and substance of the Act (the essential character of the law) is to “protect individuals’ control over the personal information disclosed by genetic tests, particularly in the context of contracting and the provision of goods and services, to ease Canadians’ fears that the information disclosed by genetic test could be used against them and to further prevent discrimination based on that information.” While Moldaver J. agreed that the provisions represent a valid exercise of Parliament’s power over criminal law, he held that the Act’s pith and substance is to protect health by prohibiting conduct that undermines individuals’ control over the intimate information revealed by genetic testing.
In finding that the challenged provisions were supported by a criminal law purpose and fell under the powers of Parliament pursuant to s. 91(27) of the Constitution Act, 1867, Karakatsanis J. noted that a criminal law purpose is interpreted broadly to include laws in response to threats of harm to public order, safety, health or morality or fundamental social values, or to a similar public interest.In this instance, the Act was intended to combat threat to autonomy, threat to public health and uphold individual privacy interests.
Kasirer J., on behalf of the four dissenting Justices, upheld the Québec Court of Appeal’s finding that the pith and substance of the impugned provisions is to regulate contracts and the provision of goods and services, in particular of insurance and employment, with the view of promoting health in Canada. The dissent held that this was not an appropriate use of the federal power and more appropriately lay in the powers of the provinces. Although the dissent acknowledged that the effect of this legislation may be to discourage discrimination based on the findings of such genetic tests, they disagreed that this was the primary purpose of the impugned provisions.
While the concurring majorities found that the purpose of the Challenged Provisions is to combatdiscrimination based on genetic characteristics, or to control the use of private information revealed by genetic testing, the dissent found that their purpose is to regulate contracts, particularly contracts of insurance and employment. The Challenged Provisions allow Canadians to undergo genetic tests without fear that those tests will be misused so that their health can ultimately be improved.
The impact of the Act on the insurance industry
All three sets of reasons acknowledged that the Act may affect the insurance industry. How these effects may manifest is however unclear.
On one hand, if more individuals are encouraged to undergo genetic testing, more people will learn about their predispositions to ailments earlier and, in a number of instances, be able to take steps to prevent such ailments from manifesting or at least delay the impacts of such. The concurring reasons illustrate this using an example of two brothers who both have a predisposition to a genetic heart disease. One brother, who had a genetic test, was proactively prescribed beta-blockers and as a result has managed his condition. The other, out of concern that he would be less employable, did not have a genetic test. Without the necessary preventative treatment this heart disease would likely result in an earlier passing. Under the theory that genetic tests will result in earlier identification and management of life altering health consequences, this may seem like a blessing for the insurance industry – meaning fewer payouts due to increased preventative action.
Unfortunately, there is always “another hand”. The Act prevents insurers from requiring individuals to (i) undergo a genetic test; and (ii) disclose the results of genetic tests. This will inevitably create an information disparity between insurer and insured. As noted in the dissenting reasons, the principle of equal information, according to which material information must be disclosed, is central to insurance contracts. In effect, it is now contrary to the Act to require individuals to disclose all material information so long as such material information is provided by a genetic test. This creates an opportunity for individuals to provide favourable results from genetic tests while withholding unfavourable results.
The path forward: Genetic testing
Ultimately, while compulsory genetic tests and forced disclosure of information from genetic tests for many activities has been banned, it remains a fact that individuals may choose to undergo this testing. Companies can encourage consumers to undergo a genetic test, and ultimately leave it up to the consumer to decide whether to share that information.
As a result of this decreased transparency, our “fear” that genetic tests may be used against individuals may result in an even distribution of risk to the masses by way of increased premiums to compensate for this information disparity. Ironically, by encouraging more people to undergo genetic tests by safeguarding the information genetic tests provide, we may have increased the overall health of the population, while also increasing insurance premiums.
This post was originally published on the Canada Insurance Law Review.