Is Your Job Protected if You’re on Claim in Ontario?

So much of our time is spent at our place of employment that when a disability forces us to be away from work, the experience can leave us feeling helpless.

Ontario law does offer some protection to employees who are off work due to a disability, but that protection is not permanent. After two or more years on disability leave, if no recovery or return to work is foreseeable, an employer in Ontario may be able to formally dismiss you for a type of no-fault reason known as “frustration of employment.”

What is frustration of employment?

Employment relationships become “frustrated” at law when they become impossible to perform, by a change in circumstances beyond either party’s control.

It’s a mechanism for severing an employment relationship without providing severance or damages for wrongful dismissal. “Your employment might become frustrated if you’ve been disabled and can’t work for a lengthy period of time with no anticipated return to work,” said Samantha Share, Managing Director at Share Lawyers. “However, if your doctor believes a return to work may be possible at some point, you may be able to dispute your job being terminated based on frustration.”

An employee’s absence is one of several factors a court will assess in determining whether the employment relationship has been frustrated.

Frustration of Employment Entitlements

While not entitled to “reasonable notice” of your termination under common law, you are still entitled to minimum notice and severance entitlements under the Employment Standards Act (ESA) where the frustration of your employment contract is due to illness or injury.

ESA payments are calculated based on years of service, which includes the period an employee is on disability leave. It tops out at 34 weeks or eight months’ pay. Employees in Ontario are fortunate when you consider some other provinces view frustration as grounds for termination without pay.

You can claim frustration of employment

An employer may drag their heels on terminating employment for frustration because they don’t want to pay the ESA entitlements.

Why pay notice and severance when they can leave you hanging for free?

This is a very common strategy used by employers. Share said, “They may go as far as to encourage you to resign so you can collect your pension or retiree benefits and do away with the nuisance of providing regular medical updates.”

However, another option may be for you to claim that your employment has been frustrated, rather than leaving it to your employer. This would also trigger the notice and severance under the ESA. Ontario courts have held that frustration occurs as a matter of law, and that your employer does not have to be the one who terminates you for the appropriate entitlements to become payable.

Be aware of offset deductions

Before you claim severance pay due to frustration, you should calculate whether doing so will benefit you in the end. There could be a provision in your long term disability coverage that allows your insurer to deduct other types of income from your regular benefits. If your LTD payments are temporarily reduced or eliminated, ask yourself if the termination or severance pay is worth it.

If you have been dismissed due to frustration of employment, or your long term disability benefits have been reduced because of termination or severance payments, you should not hesitate to contact a disability lawyer in Ontario to discuss your options more fully.

To find out if you have a valid disability case, use this free online assessment tool.

If you have had your claim for long term disability deniedin Ontario, contact the long term disability insurance lawyers at Share Lawyers. Our experienced team of long term disability (LTD) lawyers can help. We have recently settled cases against Canada Life, Desjardins, Manulife, RBC Insurance, Sun Life, and many more. We offer free consultations and there are no fees unless we win your case. Find out if you have a disability case.

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