Off the grid or getting ready to return to work?

Disappearance for a few days after drug treatment and before return to work not job abandonment: Court of Appeal

Abandoned or busy?

When an employee has a drug or alcohol problem, the employer usually has an obligation to accommodate that problem by allowing the employee to go on leave to receive treatment. Once this treatment is completed, the expectation is the employee will return to work.

However, one employer in British Columbia faced a quandary when an employee disappeared for more than a week following his drug treatment program. Not knowing where the employee was and with no way to contact him, the employer assumed the employee had abandoned his job and his employment was terminated. As it turned out, however, that wasn’t the right approach to take.

A British Columbia employer who didn’t hear from an employee who was returning after a medical leave for a few days did not have cause to believe he was abandoning his employment, the B.C. Court of Appeal has confirmed.

Paul Pereira joined Staples Business Depot as a sales manager in 1997. Three years later, he was appointed general manager of a Staples store in Nanaimo, B.C. Like all Staples employees, Pereira was a beneficiary under a group insurance policy the company funded that was administered by Sun Life, which provided short- and long-term disability benefits and comprehensive health coverage. All premiums were paid by Staples.

In June 2003, Pereira was having problems with depression and drug addiction. His job performance deteriorated and he went on short-term disability benefits for a few months. In November 2003, he was back on the job on a graduated program and by Dec. 1 he was once again he full-time general manager of the Nanaimo store.

However, Pereira wasn’t back for long. Less than a month later, his performance worsened once again and he had to go on a medical leave of absence. In February 2004, he decided he needed to move out of town for a while to get away from his drug contacts. He went on short-term disability and moved in with a friend in Kamloops, B.C. In June 2004, he switched from short-term to long-term disability benefits.

Sun Life informed Pereira that in order to remain eligible for long-term disability benefits, he would have to go to a treatment facility at his own expense. He agreed and began a 28-day residential treatment program in Kelowna, B.C., on Aug. 11. He contacted Staples and said he intended to return to Nanaimo once he finished his program on Sept. 7 and he expected to be able to come back to work at that point. He reiterated his intentions with another call on Sept. 1 and indicated he had been assigned a rehabilitation specialist to help with the transition back to work.

Intended to return to work after treatment

Staples contacted the specialist, who informed the company Pereira would need some time to find a place to live in Nanaimo and would contact Staples once he had an address and phone number. Staples requested he not go to the store until HR had met with him and had a chance to notify staff of the situation. Pereira asked Sun Life to send his disability cheque to his friend’s place in Kamloops, as he needed the money for his move back to Nanaimo. He told Staples he would update it on his status once he was back in Nanaimo.

However, Pereira’s disability cheque was mistakenly sent to the Staples head office and had to be rerouted. On Sept. 16, he contacted Staples and Sun Life about it and told the former he needed it before he could move. Sun Life informed him that normally someone would be expected to return to work within two weeks after completing treatment, but it was making an allowance in his case because of the incorrectly mailed cheque. It told him it expected he would be back at work within two weeks of returning to Nanaimo.

Pereira’s cheque finally arrived and he moved back to Nanaimo on Sept. 18, 2004. He moved into a hotel room and began looking for a permanent residence, as well as a mental health support group and psychiatrist. He didn’t inform Staples or Sun Life that he had arrived in town.

Employee went missing

Two days later, Staples called Pereira’s friend in Kamloops and left a message. The friend called back to say Pereira had moved back to Nanaimo. After some discussion over the next few days between Sun Life and the employer, the insurer decided to terminate Pereira’s long-term disability benefits on Sept. 24. It advised Staples his claim had been closed because no one had heard from him and sent him a letter at his friend’s address explaining it had expected him back to work by Sept. 21, two weeks after he completed his program.

By Sept. 28, Staples still had heard nothing from Pereira and decided he had abandoned his employment since it had no way of contacting him. It sent a letter to the friend’s address in Kamloops in order to notify him that the company considered the employment relationship over. It then arranged for his “final vacation pay and wages” to be sent to the same address, followed by a record of employment.

Meanwhile, Pereira was still looking for an apartment, which he found on Oct. 1. He met a Staples employee for coffee the next day and was told the employee heard he was no longer working for the company. Pereira was shocked and didn’t try to contact Staples. He then slipped back into using drugs.

On Oct. 18, the letters Staples had sent to Kamloops were returned. On Oct. 20, Pereira called Staples and said he was going out of town for a couple of weeks and to send “anything that needs to be sent” to him there. Staples forwarded the Sept. 28 letter there and did not hear from Pereira again, except to request an outstanding bonus cheque.

On Jan. 7, 2005, Pereira sued Sun Life over the termination of his disability benefits. Two months later, he reached a settlement with Sun Life awarding him $60,000 to satisfy “all claims” and he signed release discharging the insurer from any further demands. In April 2005, he sued Staples for wrongful dismissal.

In 2009, the B.C. Supreme Court ruled Staples was unreasonable in concluding Pereira had abandoned his employment by not reporting for work on Sept. 21. Though it didn’t hear from him between Sept. 16 and its decision on Sept. 28, it knew he was waiting for his disability cheque and had been told he would contact the company once he was settled in Nanaimo. Sun Life also told him he was expected to return within two weeks of arriving in Nanaimo, which gave him until early October.

The court also found there was no reason for Pereira to have contacted Staples as soon as he was back in Nanaimo, as he was under the impression he had until he was set up in new place of residence, nor any reason for Staples to assume his lack of contact was an abandonment of his employment.

Staples was ordered to pay Pereira ten months’ pay in lieu of notice — more than $34,000 — plus almost $17,000 for lost stock options and almost $7,000 in interest.

Staples appealed the decision, arguing its Sept. 24 letter didn’t terminate Pereira’s employment, but just “summarized the facts” of the situation. It called for a response it didn’t get, said the employer. It also argued the settlement Pereira received from Sun Life as part of his suit should be deducted from the amount Pereira was owed, if it was in fact a wrongful dismissal, since the disability payments were meant to replace his salary.

The B.C. Court of Appeal disagreed with Staples’ view of the Sept. 24 letter. All indications were that the letter was meant to inform Pereira his employment was terminated, it said. This was further proven by the fact Staples followed it up by sending his record of employment and final cheque. In addition, since it knew he was still in Kamloops waiting for his cheque on Sept. 16, it wasn’t reasonable to expect him back at work on Sept. 21, said the court. It also pointed out Pereira had “consistently expressed a desire to return to work at the store in Nanaimo.” It upheld the finding of wrongful dismissal.

“The difficulty with Staples’ position is that it only made one decision with respect to Mr. Pereira having abandoned his employment. As set out in the Sept. 28, 2004, letter, that decision was based on the fact that Mr. Pereira had not reported for work by Sept. 21, 2004. It was that decision that was communicated to Mr. Pereira. When the letter was returned, Staples did no more than send it to a different address,” said the Court of Appeal.

However, the Court of Appeal agreed with Staples that the money Pereira received from the Sun Life settlement should be deducted from the damages in lieu of notice. Since Pereira didn’t prove any part of the settlement was for anything other than lost income replacement, the full amount was to be deducted, said the court. As this exceeded 10 months’ pay, the court found Pereira wasn’t entitled to any damages for pay in lieu of notice.

For more information see:

Pereira v. Business Depot Ltd., 2011 CarswellBC 2281 (B.C. C.A.).

Latest stories