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Bad breaks for employees and employers

Employee injuries are tough to deal with for both the injured and their employers

By Jeffrey R. Smith

It’s not easy when an employee gets seriously injured.

For the sake of the employee, the hope is for as quick a recovery as possible, but this can be for the sake of the employer has well. The employer must find ways to replace the employee in the workplace for  some time until the employee recovers — and if the timeline for recovery is uncertain, that places the employer in a tough position.

If the employee is injured at work, she will likely be covered by workers’ compensation benefits while off work. If the employee’s injury happens outside of work — that’s where it can get a little trickier.

Workers’ compensation will not cover an employee’s income if the employee can’t work due to a non-work-related injury. Many employers have short- and long-term disability benefits which give employees some income while they can’t work until they return to work. But these have a cost as well, and if it’s uncertain if and when the employee will return to work, the question is whether it’s worthwhile to keep the employee on the books.

When an employee’s ability to work is compromised by a disability, the employer – with the co-operation of the employee – is required to investigate all reasonable options for accommodation – whether modified duties, shortened hours, or other possibilities – to allow the employee to return to work and perform whatever duties she is capable of. If the employee is unable to perform any duties that are reasonably available, then accommodation may involve simply staying at home until able to work. However, if nobody knows when the employee may be able to work again – if at all – the issue becomes how long is the employer supposed to accommodate?

When an employee is off work with a disability, the employer must find a replacement. Because employment can’t be terminated strictly due to a disability, the replacement can’t be permanent – unless the plan is to put the injured employee in another similar position. But if it’s not know if and when the employee will return, it can leave the workplace unsettled, since the employer doesn’t know when it will have to make room for the employee and the replacement may not know how long she’ll be in the position. This can hurt the ability of the employer to find the best person for the job. In addition, long-term disability costs money, and the intention is for that cost to go towards getting the employee back to work. If the employee might not go back to work, that money is going down the drain for the employer.

Ultimately, if it’s not known when an injured employee will return to work, the employer can claim frustration of the employment contract. The fundamental idea of employment contracts is that employees perform work for compensation from the employer. If the employee is unable to perform work, the employment contract is breached. While in the short term, an employer cannot terminate the employment contract because the employee is unable to work because of a disability, a disability that prevents the employee from ever performing work would be undue hardship for the employer – thus ending the duty to accommodate.

An employee who is unable to work due to an injury is in a tough position. An employer who has an employee unable to work is also in a tough position. Both must co-operate to deal with it. But how long should the employer be required to carry an employee on the payroll who may not come back? Should a graduated return-to-work plan and medical prognosis for recovery be a requirement for long-term disability, or should the employee be able to go on long-term disability without such a plan?

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Jeffrey R. Smith

Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective.
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