Real Life Decisions

Often a person may face a conundrum in which a choice of polar opposite directions must be taken. Such a situation may arise where the insurer denies liability to pay benefits, often at the onset of the"any occupation" period, as a result of which the employer may request the employee to return to work. The employee will usually have initially only the advice of their physician, who likely is unaware of the relevant legal test, be that “own occupation” or “any occupation” test.

If there is such uncertainty as to the medical ability of the employee to return to work, there are several alternative paths which the employee could consider. The objective is to avoid a confrontation which could lead, rightly or wrongly, to termination of employment, resultant unemployment, a pre-existing disability for new employment and litigation against an insurer, none of which is particularly attractive when the daily expenses of life remain constant.

Many sophisticated employers will not take any disciplinary action against the employee in such a circumstance.  Here are some options to be considered:

1. Typically, the employer will have no knowledge of the medical details. Its concerns may be allayed by providing a short note from the physician confirming it is upon their advice that the employee is medically disabled and remaining off work. Any action then taken against the employee would likely be a human rights violation. The employer may agree to a “time out” without pay and without sanctions.
2. Request from the physician and present to the employer a “gradual return to work” plan and include the nature of steps to be considered in accommodating the disability.
3. Consider a “without prejudice” return to work in which the employee makes it clear that they are returning to active employment, with or without accommodation, as the case may be. This can be used at a later date, if required to avoid the argument of the cessation of the disability. This can be preferably be done with the agreement of the insurer and the employer, or at the very least unilaterally.
4. Should these alternatives be unsuccessful, advocate to the employer that termination of employment is an unnecessary risk of liability for it to take, both as a human rights issue and by civil action. Doing nothing is likely the employer’s best course of action. If the employment relationship can continue, even without disability insurance being currently paid, it may still allow a later return to active employment. A claim against the insurer for disability benefits may still be made and the employment relationship ideally will remain intact. The employer’s position may even be improved as the passing of time, given a continuing disability, which may strengthen its argument should termination follow at a later date. All this, of course, is apart from any human empathic considerations and avoiding the impact of bad relations with the rest of its workforce.
5. Should the employer elect to dismiss, again rightly or wrongly, there may be a financial necessity to resolve the claim. If so, the release should except the claim against the insurer for the disability claim. Also consider then the impact of a severance claim on the disability action. The policy should be examined to determine if there is an apparent off-set for the severance payment. Consider if the offer of compensation can be made for a non-deductible sum such as damages for an alleged human rights claim, which also may be non-taxable and paid without tax at source.