How long must business keep job open for sick worker?
Q: I have an employee who has been off ill for more than three and a half years. Unfortunately, there appears to be no prospect of him returning to work in the foreseeable future. Do I have to keep holding his position open for him? If I terminate the relationship, do I owe him anything?
A: The question brings into play both the Ontario Human Rights Code and the Employment Standards Act.
Pursuant to the code, you have an obligation to hold your employee’s position open to the point of undue hardship. After three and a half years, if recent medical information confirms that there is no prospect of a return to work in the foreseeable future, it is not likely that you would get in trouble with the Ontario Human Rights Tribunal.
Employers found to have an obligation to hold the position that long have typically been very large ones that could have easily accommodated a return to work.
Under the act, you will be required to provide termination pay of one week per year to a limit of eight weeks based on their most recent wages and vacation pay on that amount. If they have been with you more than five years (including the sick time) and your payroll exceeds $2.5 million, you would also owe them severance pay of one week per year to a limit of 26 weeks.
Quite frankly, if you don’t have a benefits plan for them which is costing you ongoing money, sending that termination letter could be an expensive and fruitless exercise.
After three and a half years, it is unlikely they are ever coming back.
Paying termination and severance just to avoid the possibility of them showing up looking for their job might not be worth it.
If you have a benefits plan and you cover all or part of the premium costs, there are different considerations. In order to not pay for benefits coverage indefinitely, it may be worth it to you to trigger the termination and severance payments.
Increasingly, employers are developing policies which indicate that an employee who is off for more than 12, 18 or 24 months on a leave of absence will have their benefits discontinued. Maternity and paternity time off do not count.
If this policy is already in place and you discontinue benefits, it will not constitute discrimination under the Ontario Human Rights Code, nor will it allow the employee to take the position that you have terminated them by discontinuing their benefits. You are simply following the established policy.
Since there is no law requiring you to provide benefits coverage, if you want to develop a policy discontinuing it after a certain amount of time, you can.
If the employee would regularly contribute to the costs of the benefits, you can require them to continue those payments while they are off ill. You could also develop a policy indicating that after a certain amount of time, instead of paying half of the cost of the benefits, the employee has to pay 100 per cent for them to continue.
There was one case a couple of years ago where a judge decided that an employee who went off ill and passed away a couple of months later was entitled to termination pay as a result of frustration of contract. The judge found that sometime between the point that he went off ill and passed, the contract had become frustrated as a result of his illness and impossible to perform. The judge decided this even though the employer had done absolutely nothing but wait for the employee to return to work. No benefits were terminated. No letter was sent ending the relationship.
The Ministry of Labour, appropriately, is ignoring this decision. The wording of the Employment Standards Act clearly requires the employer to take some sort of action in order for it to be deemed that the termination has occurred.