If you are off work on disability benefits or otherwise are unable to return to work due to a medical illness or injury, after a certain period of time elapses whereby you do not return to work and your medical practitioners conclude that you will not return anytime in the foreseeable future, the employer can deem your employment contract to be frustrated.
The frustration of the employment contract occurs when an employee is unable to uphold his or her terms of the contract on account of being off work due to disability. In such a scenario, an employer is, in fact, permitted to terminate an employee on the basis of frustration of contract (i.e., they will be protected from a claim for human rights damages in connection with discrimination based on disability, if the termination based on frustration is carried out properly). If properly terminated from employment on account of frustration, an employer is only obligated to pay to the employee their minimum statutory termination and severance pay (if applicable) under the Employment Standards Act. Reasonable notice of termination or pay in lieu thereof is not required to be paid to the employee in such circumstances; as such, an employer can avoid a large severance package obligation when terminating an employee for the frustration of contract.
If you are on medical leave from your employment, please contact our law firm to discuss your options.