Firefighter retracted resignation; collective agreement topped up workers' compensation benefits

An Ontario arbitrator has rejected a public-sector employer’s claim that a worker with a permanent restriction from his old job who was receiving workers’ compensation benefits resigned from his employment when he completed a retraining program and accepted work in his new suitable occupation.
The City of Mississauga, Ont., had a collective agreement with its firefighters union that entitled employees to their full pay and benefits while off work due to a workplace illness or injury for which they receive loss-of-earnings (LOE) benefits under the Ontario Workplace Safety and Insurance Act (WSIA). Employees also received their pre-injury salary if they return to work on modified duties in a lower-paying position.
Suppression firefighters for the city worked seven, 24-hour shifts per month. As a result, they were allowed to work second jobs as long as they were consistent with city policies around conflict of interest. Any employees on sick leave or workers’ compensation leave could only hold a second job if it didn’t conflict with their medical condition.
According to the union, about 80 per cent of firefighters had some sort of secondary employment or were self-employed.
The worker was a suppression firefighter for the city beginning in 2003. He was promoted to acting captain in 2016. He also ran his own landscaping business between firefighting shifts.
Workplace injury
In November 2020, the worker emailed the acting district chief saying he would be resigning from his employment effective Jan. 14, 2021. In the resignation letter, he reserved the right to withdraw his resignation if he was injured, either at or outside work.
Later that month, the worker went off work and filed a workers’ compensation claim for occupational post-traumatic stress disorder (PTSD). On Dec. 2, he informed the acting district chief that he was retracting his resignation, which the city confirmed.
The Workplace Safety and Insurance Board (WSIB) granted the worker full LOE benefits from Dec. 2, 2020, paid to the city while the city paid the worker’s salary and benefits. The worker’s medical practitioners advised that he was unable to return to work while he underwent treatment through a WSIB mental health program.
On March 2, 2021, the worker reported to his WSIB case manager that he was triggered by any thoughts of work.
Permanent restrictions
In early 2022, the WSIB advised the city that the worker would likely never be able to return to work as a firefighter or first responder and even exploring return-to-work services was triggering to him. A few months later, the city told the WSIB that it was prepared to consider alternative work and accommodation, but the WSIB said the worker still couldn’t return to work.
The worker continued to receive psychological treatment and the worker took a training course on septic system installation. The WSIB referred the worker to a return-to-work specialist (RTWS) in September and the worker took computer training. In December, the WSIB confirmed to the city that the worker was permanently restricted from working as a firefighter or first responder.
In early 2023, the RTWS advised that the worker was engaged in return-to-work planning for employment outside of the city. The WSIB told the city about the worker’s computer training and asked if suitable work options could be identified with the city. The city later advised that there was no suitable work available with the city and they supported the search for a new suitable occupation.
In September, the RTWS advised they were proposing a suitable occupation and opportunities with the city would be prioritized over the broader labour market. A month later, a return-to-work plan for a septic system installer as a suitable occupation was approved.
The city advised that it had no such roles, but it would continue to search for alternative work. However, the WSIB case manager reported that the psychologist had provided a permanent restriction for working with the city.
Return to work
The worker completed a return-to-work and training program in May 2024 and his PTSD diagnosis was confirmed, with the permanent restriction of work as a first responder in any capacity. In July, he started working in his suitable occupation as a septic designer for a private company. His LOE benefits were changed to reflect his wages in his new job.
On Sept. 17, the city informed the worker that it considered him to have resigned from his employment effected July 2, his start date with his new job. On Oct. 2, the worker replied that he had not resigned.
However, the city maintained that the worker had resigned and retroactively ended his WSIB top-up and benefits effective July 2. The union filed a grievance alleging that the city had breached the collective agreement by unilaterally deeming the worker to have resigned. The city also took the position that the worker’s employment was frustrated.
The arbitrator noted that the test for a resignation requires an employee’s subjective intention to quit as well as the employee carrying out an act that is objectively consistent with quitting their employment.
The arbitrator also noted that firefighters for the city regularly engaged in full-time work while they worked as firefighters, and the worker’s notice of resignation in November 2020 reserved the right to revoke it – which he clearly did when he was injured later that month. In addition, when the city informed the worker that it considered him to have resigned when he accepted the suitable occupation, the worker clearly responded that he had not, the arbitrator said, adding that the worker had an obligation to comply with WSIB directions while receiving benefits, including seeking suitable alternative employment, the arbitrator said.
No intention to resign
The court found that the worker accepting employment with the septic service company wasn’t inconsistent with his employment with the city and it didn’t show an intention to resign. His retraction of his notice of resignation and response to the city’s communication that it considered him to have resigned were actions that objectively showed he didn’t resign, said the arbitrator.
The court also noted that frustration was typically applicable where a disability or other vent not provided for in the contract renders performance of the contract impossible. However, the collective agreement in this case anticipated a scenario where an employee couldn’t perform their job due to occupational injury and was receiving WSIB benefits, and provided continuing entitlements in those circumstances. The parties had contemplated and provided for benefits for disabled employees without limitation, so the contract wasn’t frustrated, the arbitrator said.
The arbitrator upheld the grievance and ordered the city to reinstate the worker effective July 2, 2024. It was left to the parties to determine the issue of remedy.