The company claimed that it could terminate a disabled worker because his disability frustrated the employment contract. The arbitrator disagreed, pointing out that the Canada Labour Code overrode the common law and the collective agreement and guaranteed him employment and benefit coverage.
A trucking company fired and then discontinued making benefit and pension plan contributions for a non-active worker 21 years after he sustained a disabling workplace injury.
J.S. worked for a trucking company as a lead hand on a loading dock. He was injured in 1989 when propane fuel leaked from a forklift. The liquid propane ran down his arm, collected in his glove and then flash froze his hand.
The injury necessitated the amputation of his arm below the elbow four years later. Though he was fitted with a prosthetic device, the company informed him it could not accommodate his disability.
Nevertheless, J.S. retained his employment status and the company continued to make contributions on his behalf to the Health and Welfare Plan according to the terms laid out in the collective agreement.
J.S. understood that the company would continue making these contributions until he turned 65.
Thought he was dead
Once in 1996, the benefits were cut off when someone in the company thought J.S. was dead. The benefits were reinstated.
In 2010, the benefits were cut off again. This time the company was under the impression J.S. had reached 65. He was only 60.
However, as a consequence of the union’s effort to have his benefits reinstated the second time, new management from the company that had acquired the original trucking company decided to revisit J.S.’s file.
In November 2010, the company wrote J.S. saying it had no documented restrictions on file for him. J.S. was told that in order to determine whether or not any workplace accommodation was possible, the company needed updated medical information concerning his condition and capabilities.
J.S. was given until Jan. 4, 2011 to provide information concerning his fitness to work. He was told he would be fired if no suitable work was available or if there was no prospect of change in his condition.
J.S. was unable to comply with the deadline. He was fired on Jan. 10, 2011.
The union grieved.
The company argued the termination was justified because the contract of employment had become frustrated. J.S. was not asking for any workplace accommodations and he was unable to perform any work for the employer. There was no prospect he would be able to work in future.
The employer acknowledged section 239.1 of the Canada Labour Code (the “Code”), which prohibits employers from dismissing, suspending, laying off, demoting or disciplining workers for absences from work due to work-related illness or injury.
However, in this case the Code proscriptions did not apply, the employer argued. J.S. was fired when the employment contract became frustrated by his inability to work, not because of his work-related injury.
In addition, J.S. did not qualify for the payments to his Plans according to the criteria outlined in the collective agreement, which required workers to report for work at least once during the month in which benefit payments were made.
Code takes precedence
The union argued the requirements of section 239.1 of the Code took precedence.
The Arbitrator agreed.
The clear intent of the Code is to protect the employment status and benefits of workers who are injured on the job, the Arbitrator said.
Those protections are not subject to a time limit. The bottom line is that an employer cannot dismiss a worker — in the words of the Code — “because of absence due to a work-related illness or injury.”
The intent of the Code is to preserve an employee’s access to pre-absence health and disability benefits along with the continuation of employer benefit and pension contributions, the Arbitrator said.
Moreover, “[T]hese statutory provisions must override any restrictions in the collective agreement, as exist here … in the requirement that employees be at work some time during the month for which contributions are made.”
The Arbitrator agreed with the employer that Section 239.1 is not an open-ended guarantee of employment status and health benefits. An injured worker’s entitlements may change if the worker’s health or employment prospects improve.
That didn’t happen here, the Arbitrator said.
There had been no essential change in J.S.’s circumstances for many years. J.S. had more health issues now, but his disability was the same in 2010 as it was when the employer said it had no work for him.
Doctrine of frustration does not apply
The Arbitrator rejected the employer’s assertion J.S. was absent because of his inability to perform work rather than due to a work-related injury. There was no distinction. “His inability to perform work is the direct result, and solely the result, of his work-related injury.”
The Arbitrator also rejected the Employer’s attempt to apply the doctrine of frustration of contract to J.S.’s circumstances.
“Even assuming the doctrine has some general application in labour relations, it cannot apply to an employee under the Canada Labour Code whose absence from work is due to a work-related injury or illness. This is because Section 168 of the Canada Labour Code — which says Part III of the Code, including Section 239.1, applies notwithstanding any other law — overrides the common-law doctrine of frustration.”
J.S. was ordered reinstated and compensated for any losses incurred while his benefits were cut off. His benefits were restored.
