October 4, 2017
In a recent decision of the Ontario Superior Court of Justice, a judge ruled that a working notice period does not apply to an employee who is on disability leave from his employer.
In this case, a 43 year old employee with 18 years’ service commenced a disability leave in January, 2016 for a non-work related accident. The employer terminated the employee’s employment with working notice at the end of January, 2016, while the employee was still on disability leave, as a result of the pending closure of the business scheduled for July, 2016. The employee attempted to return to work for two shifts before the business finally closed in July, 2016.
In granting summary judgment in favour of the employee, the Court held that employers cannot provide working notice to employees on disability leave as they are incapable of working.
The Court awarded the employee damages in an amount which was equivalent to the salary he would have earned had he actually worked during the notice period until he started new employment (nine months), which was within the 12 months’ notice period the judge assessed as appropriate, less the wages earned for the two shifts he worked and less the amount already paid by the employer for statutory notice under the Employment Standards Act (the “ESA“).
In doing so, the Court rejected the employer’s assertion that the employee could have returned to work earlier; either with the employer or by mitigating earlier with a new employer, as the employee had obtained a letter from his family doctor attesting to his incapacity. The judge stated that the employee could not have searched for new work until he was medically able.
Presumably, working notice was given so that the employer could take advantage of the notice period running while the employee was not at work and therefore not earning wages. However in doing so, the employer prevented the disabled employee from the benefit of a transition period to look for new employment, which the notice period is meant to provide. Had the employer terminated the employee at the time of the actual closure of the business, and not tried to gain the benefit of a working notice period from a sick employee (which would have effectively resulted in no wages to the employee until he recovered), it would have paid significantly less in damages; being only from the date of the closure in July, 2016 to the date the employee recovered and found alternate employment in October, 2016.
This case emphasizes that employers should be very cautious not only with the quantum of notice they provide to terminated employees but also with the manner in which notice is given and seek legal advice prior to the termination notice being sent.
McLeod v. 1274458 Ontario Inc., 2017 ONSC 4073