Toronto-based law firm Davies Howe Partners LLP presented employment and disability insurance law case studies at the Beneplan Plan Administrator's Workshop, November 21, 2014.
4. Termination of Employment
Employment Standards Act
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Must give notice of termination or pay in lieu thereof
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Notice period: 1 week for every year, up to 8 weeks
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No notice if an exception applies (e.g. wilful misconduct, refusing reasonable alternative work, reaching retirement age)
5. Termination of Employment
Employment Standards Act
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Severance of 1 week for every year of employment if:
Employed 5 or more years, and
Employer has 50 or more employees or payroll of $2.5 million or more
To a maximum of 26 weeks
6. Termination of Employment
Common Law
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Notice or pay in lieu due at common law, unless contract says otherwise
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Length of notice factors include:
Length of employment
Nature of position
Age
Prospect of finding alternative work
7. Termination of Employment
Common Law
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If there is just cause for termination, no common law notice required
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“Just cause” not necessarily same as “wilful misconduct, disobedience or wilful neglect of duty” under ESA
8. Employees with Injury or Illness
Human Rights Code
•Discriminatory to terminate employee because of a disability (even with notice)
•“Disability” is broadly defined
•Employer must accommodate up to point of “undue hardship”
9. Employees with Injury or Illness
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Accommodation: modify terms of employment or duties to assist employee in overcoming limitations
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Factors for undue hardship:
Financial costs
Size of the employer’s operations
Risks to health and safety
Morale of other employees
Impact of accommodation measures on other employees’ rights
10. •
Can terminate employee due to disability under Human Rights Code only if:
Employee is incapable of performing essential duties, and
Employee’s needs cannot be accommodated without undue hardship
Employees with Injury or Illness
11. •
Common law: cannot terminate for injury or illness without notice, unless it rises to level of frustrating employment contract
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Employer must hold job until contract frustrated
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Frustration: contractual obligation becomes incapable of being performed, making contract fundamentally different from what was originally contemplated
Frustration of Contract
12. Impact of frustration on Notice
•ESA: employer not exempt from notice requirement
•No common law notice
Frustration of Contract
13. Frustration of Contract
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Duong v. Linamar Corp., 2010 ONSC 3159
Employee injured at work and was diagnosed with fibromyalgia
LTD benefits ceased after 30 months
Employment terminated
Contract frustrated:
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employee was totally disabled
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no reasonable, foreseeable date for his return
14. Frustration of Contract
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Naccarato v. Costco Wholesale Canada Ltd., 2010 ONSC 2651
Employee began receiving LTD benefits in 2002
Terminated in 2006 - paid ESA minimums
Contract not frustrated:
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no known return date
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lack of evidence of no reasonable likelihood of return to work in reasonably foreseeable future
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no evidence of hardship or disruption to business by holding position
15. Frustration of Contract
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Altman v. Steve's Music Store Inc., 2011 ONSC 1480
Employee of 30 years diagnosed with lung cancer
Terminated following 8 months of reduced hours and 6 months of medical leave
Health deteriorated after termination
Contract not frustrated:
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assessment of health as of date of dismissal
16. Frustration of Contract
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Altman v. Steve's Music Store Inc., 2011 ONSC 1480
Factors for whether contract is frustrated:
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terms of the contract
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length of past employment
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how long employment was likely to last in the absence of illness
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nature of the employment
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length of illness or injury
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prospect of recovery
18. Disability Insurance
Case 1
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Employee worked as dispatcher for coach line
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Employee requested enrolment in group LTD plan
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Employer allegedly failed to enroll employee or deduct benefits
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Employee became ill and made LTD claim, which was denied
19. Disability Insurance
Case 2
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Employee worked as security officer
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Employee left work due to illness
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Through an oversight, employer had never enrolled employee in group LTD plan
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Employer attempted to enroll employee after claim for LTD benefits
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LTD benefits denied
20. Disability Insurance
Case 3
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Employee worked as welder and participated in a work sharing program
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Employee became ill
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LTD claim denied on basis that policy required employee work at least 25 hours per week
21. Disability Insurance
Case 4
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Employee worked as office services clerk
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Employee stopped working due to work- related stress
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Employer allegedly told employee she had no LTD coverage
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As a result, employee filed LTD claim 8 months late and claim was denied
22. Thank You
David Cherepacha
Davies Howe Partners
416.263.4506
davidc@davieshowe.com
www.davieshowe.com
Ava Kanner
Davies Howe Partners
416.263.4503
ava@davieshowe.com
www.davieshowe.com