Termination While on a Disability Leave

The legal interaction between disability leave and termination of employment can be complicated, and highly context specific. Here are general answers to some of the most common questions we get from employees who have been terminated while on disability leave:

Can my employer dismiss me while I am on a disability leave?

Yes – contrary to popular belief, employees on a disability leave may have their employment terminated, so long as the employer’s reasons for doing so are completely unrelated to the disability leave. For instance, employees are not protected against having their jobs eliminated by a restructuring while on a disability leave of absence.

What termination entitlements should employees on a disability leave receive?

Being on a disability leave, on its own, does not change your termination entitlements – you are entitled to notice of termination, or pay in lieu of notice. Employees on a disability leave almost always receive just pay in lieu of notice, since time on a disability leave cannot be counted towards notice of termination.

What if my disability leave influenced my employer’s decision to terminate me?

Your employer has a duty to accommodate your disability leave up to the point of undue hardship. Failing to do so is a violation of your human rights. You can pursue your employer for additional human rights damages in a wrongful dismissal claim – you may even seek to have your employment reinstated (although this is an extraordinarily rare remedy, unless you are represented by a union).

How does my termination affect my continued receipt of disability benefits?

Usually, the termination of your employment should not impact your ongoing receipt of disability benefits – though your coverage under the plan may cease.

What does it mean if my employer says my employment has been frustrated?

Employment relationships become “frustrated” at law when they become impossible to perform. Frustration is a no-fault termination of employment; it means your employer can end your employment without providing some of the notice (or pay in lieu of notice) that would typically be required.

Your employment might become frustrated if you have been disabled from work for a lengthy period with no reasonably foreseeable return to work. In the disability context, frustration of employment typically starts becoming a possibility after about 2 years of absence due to disability, with no foreseeable return. That said, if your doctor believes that a return is possible, your employment may survive for much longer – in some cases, for as long as a 5-year absence.

How does frustration affect my termination entitlements?

If your employment has become frustrated due to a disability, you are still entitled to your minimum notice and severance entitlements under employment standards legislation. You are not, however, entitled to “reasonable notice” of your termination at common law.

How can I contest my employer’s decision to terminate me?

Employers will often look for an excuse to terminate employees who are on disability leave, whether by “eliminating” your position; prematurely claiming that your employment has been frustrated; or dredging up issues to artificially justify your discriminatory termination. You can contest your employer’s decision by bringing legal proceedings – typically, by suing your employer for wrongful dismissal. An employment lawyer can advise you on your rights and represent you through that process.

Do I have a duty to look for other work?

In most cases, if you wish to sue your employer for wrongful dismissal, you have a “duty to mitigate” your damages by looking for other reasonably similar jobs in your area. However, you only have a duty to mitigate if you are capable of gainful employment. That means that if you are disabled from working in a comparable job, you do not have a duty to mitigate your damages for wrongful dismissal by looking for other work.

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