Court Decision: When does Employer’s duty to accommodate end?

A recent decision by the Ontario Divisional Court has outlined that an employer’s duty to accommodate ends when an employee’s disability becomes permanent and as a result, the contract of employment cannot be upheld.

The case – Katz v. Clarke

Mr. Clarke (the employee), was employed as a Front Store Manager at a pharmacy owned by the Katz Group (“Katz”) where Mr. Clarke had been employed for approximately 13 years at the time of termination.   However, he had been off work on a leave of absence for over five years.

Mr. Clarke had been approved for short-term disability, followed by long-term disability.

Great-West Life (the disability insurer) advised the employer (Katz) that based on medical information, Mr. Clarke was not able to perform the essential duties of his position and there was no reasonable expectation that he would be able to perform them in the foreseeable future. Based on this, Katz advised Mr. Clarke that his employment had been frustrated due to his prolonged absence from work, his inability to perform the duties of his position and the lack of reasonable expectation that he would be able to return to perform the duties of his position in the foreseeable future.

Mr. Clarke’s legal counsel advised the employer that Mr. Clarke was “working very hard to get well so that he can return to his former employment and perform the essential duties of his position”, the employer provided Mr. Clarke with the opportunity to provide updated medical information outlining his projected return to work date. Mr. Clarke failed to provide this information and Mr. Clarke’s employment was terminated due to frustration of contract.

Mr. Clarke commenced an action against Katz of wrongful dismissal and damages under the Ontario Human Rights Code. Katz moved for summary judgement to have the claim dismissed. The motion judge dismissed this motion for summary judgement.

The motion judge noted that Katz was aware of Mr. Clarke’s desire to return to full employment and it was arguable that Katz’s failure to spend time and effort to explore with Mr. Clarke how his desire to return to work could be accommodated resulted in a “rush to judgment” that breached the Code.

Katz appealed the decision to the Ontario Divisional Court.

The Ontario Divisional Court overturned the decision of the motion judge, saying that an employer’s duty to accommodate is only triggered when an employee informs an employer not only of their wish to return to work, but also provides evidence of their ability to return to work.
The Court also confirmed that an employer’s duty to accommodate ends where the employee is no longer able to fulfill the basic obligations of the the employment relationship. 

When the employee’s disability is permanent, the employment contract is impossible to uphold and is therefore frustrated. However it can be noted that in this case the employer was successful in establishing frustration of employment after the employee had been absent from work for more than five years.

Sources:

Katz Group Canada Ltd. v. Clarke, 2019 ONSC 2188, 

Benefits Canada: ‘Inherently impossible’ to accommodate employee unable to work, finds Ontario court

Miller Thomson : Katz et al. v. Clarke: Ontario Divisional Court Upholds Termination of Employee Due to Frustration of Contract