LONG TERM DISABILITY, RIGHTS AND OBLIGATIONS
Ed Canning Sep 17, 2004
When employees are ill for an extended period of time, the rights and obligations of employers can become a tricky issue.
Short term illnesses up to about four weeks rarely create much of a dilemma. Most employers have some sort of sick pay plan where they will cover five or ten sick days per year and pay the employee=s full wages. It should be noted that there is no legal obligation for an employer ever to pay for a day that an employee is off sick. Employers who do not have such an arrangement will immediately issue their employee an Employment Record when sickness begins. The Employment Record indicates that the employee is off ill and that there has been an interruption of earnings. With this Employment Record the employee can apply for Employment Insurance sick benefits. Employment Insurance sick benefits start two weeks after the employee went off work and continue for a maximum of fifteen weeks.
Most employers have disability insurance coverage for their employees. In most cases, the employee is eligible to apply for disability insurance starting when the fifteen weeks of Employment Insurance benefits run out.
It is around this point that I sometimes get calls from employers asking if they can terminate the employee so that the employee cannot get disability coverage and the employer=s insurance premiums for that coverage will not go up the next year.
Terminating an employee who is off ill will have absolutely no effect on the employee=s ability to apply for or continue to receive disability coverage. If that were not the case, disability insurance companies would go around offering bribes to employers to terminate ill employees and avoid a disability claim. Disability insurance is like car insurance; what matters is whether or not you were insured on the day you were in the car accident. In the case of disability insurance, what matters is whether you were covered by the insurance policy on the day you became disabled, that being the day you went off ill in the first place.
Terminating an ill employee will not only have no effect on their right to claim disability insurance, it will very likely result in a human rights complaint being brought by the employee against the employer. If it cannot be said for certain that an employee will never be returning to work as a result of their medical condition, an employer should wait at least two years before terminating an ill employee and even then should consult with an employment lawyer first.
Issues often arise with respect to who is obliged to pay the medical insurance premiums for ill employees. Many employers have an arrangement with their employees where the employer pays a percentage of the cost of the monthly premiums and the employee pays a percentage through payroll deductions. If that is the arrangement, there is no law which says the employer is obliged to pay 100% of the premium because the employee becomes ill and does not have a pay cheque from which to deduct their part of the premium.
In these situations, the employer should send a polite letter to the employee wishing them a quick recovery but indicating that if they want their medical insurance coverage to continue they must provide the employer with a cheque on a monthly basis for the employee=s part of the premium.
Under human rights legislation, employers clearly have an obligation to keep a job open for a seriously ill employee and to accommodate some limitations when the employee returns to work. Human rights legislation also obliges the employer to continue to pay their part of the insurance premiums during the illness. It does not, however, oblige employers to cover more of the insurance premiums than they usually would.
Human rights law is an elastic and ever-changing thing. It is driven, like all law, by politics and policy. A few years from now the law might be quite different, but for now this is how things stand.
Arguably, this is how things should remain. After all, employers are not a social insurance agency. Should they really be obliged to do more than pay their part of the benefits coverage for an employee who is not at work for more than a few years?
As published in the Hamilton Spectator, November 18, 2002