We are often asked how long an employer is required to keep a position open for an employee who is off sick. If an employee is off sick with no prospect of him or her returning to work, it is understandable that the employer would need to have that position filled.
However this situation brings into account both the Ontario Human Rights Code (if the employer is located in Ontario) and the Employment Standards Act as well as additional considerations if you have a group benefits plan.
Requirements by the Ontario Human Rights Code
The Ontario Human Rights Code outlines that an employer must hold the employee’s position open to the point of “undue hardship” on the part of the employer. To claim the undue hardship defense, the organization responsible for making the accommodation has the onus of proof. The nature of the evidence required to prove undue hardship must be; objective, real, direct and, in the case of cost, quantifiable. The organization responsible for accommodation must provide facts, figures and scientific data or opinion to support a claim that the proposed accommodation in fact causes undue hardship. A mere statement, without supporting evidence, that the cost or risk is “too high” based on impressionistic views or stereotypes will not be sufficient.
Employers will also be obligated to provide the employee with termination pay of one week per year they were employed to a limit of eight weeks based on their most recent pay grade as well as vacation pay on that amount. If the employee has been with the company for more than five years (including time off on sick leave) and your payroll exceeds $2.5 million, you would also owe severance pay of one week per year to a limit of 26 weeks.
In the situation of Group Benefit Plans
If you have a group benefits plan and you cover all or part of the premium costs, you may wish to consider termination and severance payments so the company is not paying for the employee’s benefits coverage indefinitely.
Ed Canning recently wrote a great article in The Hamilton Spectator How long must business keep job open for sick worker? discussing this topic and outlines that, “increasingly, employers are developing policies which indicate that an employee who is off for more than 12, 18 or 24 months on a leave of absence will have their benefits discontinued. Maternity and paternity time off do not count. If this policy is already in place and you discontinue benefits, it will not constitute discrimination under the Ontario Human Rights Code, nor will it allow the employee to take the position that you have terminated them by discontinuing their benefits coverage. You are simply following the established policy.
Set up a policy relating to group benefit premiums and coverage for employees off on leave
As there is no law requiring you to provide benefits coverage, you can develop a policy discontinuing benefit coverage after a certain amount of time.
Canning also explains “If the employee would regularly contribute to the costs of the benefits, you can require them to continue those payments while they are off ill. You could also develop a policy indicating that after a certain amount of time, instead of paying half of the cost of the benefits, the employee has to pay 100 per cent for them to continue.”
There are various ways you could set up the policy however it is important that a policy is established and communicated to employees.
The Hamilton Spectator, ED CANNING: How long must business keep job open for sick worker?
Ontario Human Rights Code http://www.ohrc.on.ca/en/iv-human-rights-issues-all-stages-employment/13-ending-employment-relationship