Collective agreement provision allowing termination after 2 years of absence due to injury didn’t release employer from duty to accommodate
An Ontario municipality’s termination of an employee after he was off work from an injury for two years was permitted under the collective agreement but still was a failure to meet its duty to accommodate, an arbitrator has ruled.
Robert Reed was hired as a paramedic for the District of Halton and Mississauga, Ont., Ambulance Service in November 1984. Twenty years later, the district became the Regional Municipality of Peel and Reed’s position and employment were transferred to the newly formed municipality.
On April 15, 2014, Reed was injured on the job and was granted loss-of-employment benefits from the Ontario Workplace Safety and Insurance Board (WSIB) for the time he was off work. The following month, on May 9, he provided a medical note to the municipality that stated he would be off work due to medical reasons unrelated to his workers’ compensation claim. He began receiving short-term disability (STD) benefits and, in September, went on long-term disability (LTD) benefits.
While Reed was off work, the benefit plan administrator, Sun Life, supplied updates to Peel’s disability management specialist (DMS) regarding Reed’s claim, prognosis, and projected return-to-work date, as was established practice. The DMS then kept Peel’s human resources department up to date on Reed’s status with an aim to accommodating his restrictions and any necessary job modifications when he returned.
The collective agreement between Peel and its union allowed the municipality to terminate an employee who was absent from work by reason of illness or accident for more than 24 months, though it sometimes considered other options such as additional accommodation before doing so. In addition, after 24 months Sun Life could decide to discontinue LTD benefits if an employee was totally disabled.
On Dec. 17, 2015, Sun Life informed Peel’s DMS that there was “no return to work planning at this time” for Reed. A few months later, in April 2016, Sun Life advised that Reed’s doctors had provided information that was insufficient to determine if he was entitled to LTD benefits beyond 24 months. Reed’s LTD benefits elapsed on July 30, 2016, and Sun Life was still waiting for clarification of Reed’s condition and restrictions. Peel contacted Reed to ask him about his fitness to return to work but Reed was unable to provide any update to his prognosis.
In June 2016 Reed wrote to Peel seeking clarification of his entitlement to LTD benefits beyond the 24-month period in the collective agreement, and the municipality advised that he needed to be totally disabled from performing any occupations in order to qualify.
LTD benefits stopped after 2 years
By July, Sun Life hadn’t received the additional information it needed to extend Reed’s LTD benefits. As Peel had informed Reed, his condition had to prevent him from performing the duties of any occupation that he could do based on his education, training, and experience for the benefits to continue after July 30. After Sun Life contacted him, Reed’s doctor provided additional medical information to support a claim of total disability, but Sun Life requested an Independent Medical Examination (IME) due to “complexities of this claim.” Sun Life told Reed that if he didn’t attend the IME, it would close his claim.
However, Reed didn’t confirm receipt of this information and didn’t attend the IME. As a result, Sun Life discontinued his LTD benefits and Reed filed a civil claim against the provider.
When Peel Region was informed that Reed’s LTD benefits had been discontinued, a management meeting was held to discuss options. They determined there was no estimated return-to-work date —with no indication from Reed if he would be returning at some point and he had failed to attend the IME — and decided to terminate Reed’s employment without cause in September 2016. The termination letter stated that the information it possessed indicated he was “not likely to return to work in the foreseeable future” and it needed “to carry on with our operations.”
The union grieved Reed’s dismissal, arguing that it violated his rights under the Ontario Human Rights Code as well as the collective agreement’s discrimination provision and requirement for termination to only be for just cause.
The arbitrator found that the collective agreement’s provision allowing termination of employment after 24 months’ absence due to injury or illness overruled or satisfied the just-cause termination provision, so the termination would only be wrongful if it violated Reed’s rights under the human rights code.
Innocent absenteeism
The arbitrator noted that a failure to regularly attend work due to reasons beyond an employee’s control was considered innocent absenteeism and could be grounds for termination based on frustration of the employment contract. It had been established in employment law that frustration of contract occurs when the employee can’t fulfil her job duties and has no prospect of returning to work in the foreseeable future, said the arbitrator.
In the context of the duty to accommodate, attendance at work and performance of job duties could be considered bona fide occupational requirements. However, the employer’s duty to accommodate was still in effect up to the point of undue hardship. The question was, did Reed’s circumstances constitute undue hardship, the arbitrator said.
The arbitrator found that the 24-month period in the collective agreement protected employees receiving LTD benefits from dismissal for that length of time — this was a “negotiated accommodation.” Once Reed reached that period in April 2016, Peel continued to keep him as an employee for an additional five months. It only terminated Reed’s employment after Sun Life discontinued the LTD benefits and informed the municipality that there was no return-to-work date, not due to any evidence Peel had reached the point of undue hardship, said the arbitrator.
The arbitrator noted that “the most significant shortcoming” in Peel’s accommodation efforts was the fact that it didn’t directly contact Reed before deciding to terminate his employment. After inquiring about his prognosis in April 2016, the only communication with Reed was a brief answer to his inquiry about his eligibility for continued LTD benefits. At that time the municipality didn’t ask about the possibility of returning to work, nor at any time was Reed warned his job could be in jeopardy — Reed was told management just wanted “to get a sense if you were able to return to work.”
“In short, the region’s efforts did not make it clear to (Reed) that they were serious about determining whether or not he would be fit to return to work in the foreseeable future,” said the arbitrator. “It is not enough for an employer to rely upon its disability benefits provider to enquire about and assess an employee's fitness to return to work. In order to fulfill its duty to accommodate, the employer must make its own enquiry and determination.”
The arbitrator noted that Peel’s organizational structure — including human resources, the DMS, and third-party insurer Sun Life — impacted its ability to communicate directly with Reed about his return-to-work obligations and the collective agreement. Reed didn’t seem to be aware he could be terminated after two years’ absence when he asked about a continuance of LTD benefits, and he was never told that Peel was considering that option.
The arbitrator determined Peel failed to accommodate Reed to the point of undue hardship, violating his right to equal treatment under the Ontario Human Rights Code. Both parties agreed to submit evidence related to a remedy following the arbitrator’s decision.
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