Traditionally, when an employee’s absenteeism was excessive and there was no reasonable prospect of returning to work in the foreseeable future—as long as there was no contractual term providing otherwise—a Canadian employer could discharge the employee for non-culpable absenteeism or treat the employment contract as having been frustrated. This would bring the employee’s employment to an end.
With the proviso that as long as there is no available reasonable accommodation without undue hardship that could result in the employee returning to work in the foreseeable future, this test has generally been recognized as being consistent with human rights obligations of Canadian employers and applied by human rights adjudicators across the country.
However, a recent British Columbia arbitration decision suggests that when considering discharging employees for non-culpable absenteeism, employers may need to consider more than just the traditional test.
In Langley Township v. Canadian Union of Public Employees Local 403, the employer considered the employment of three employees, each of whom was on long-term disability (LTD) and “totally disabled from any occupation.” Two of the employees had been on LTD for six years. The other had been on LTD for 10 years. The level of absenteeism of all three was excessive. And there was no reasonable prospect of any of them returning to work in the foreseeable future.
The employer reviewed the cost to the employer of continuing the three employees’ benefits if they remained employed. It realized that if all three were discharged, it would result in a cumulative cost savings of approximately $10,000. The employer’s overall budget was $178 million.
The employer discharged all three employees. While the discharge had no impact on the employees’ entitlement to LTD benefits, it adversely affected each of them as it resulted in the termination of their benefits coverage. Each also claimed that it created stress and financial hardship.
The traditional test for non-culpable discharge for innocent absenteeism was satisfied for all three employees: They had all been absent from work for an excessive period, and there was no reasonable prospect of any of them returning to work in the foreseeable future.
The arbitrator’s assessment did not stop there. Instead, the arbitrator went on to consider whether the discharges were contrary to the employer’s human rights obligations.
The employer conceded there was prima facie discrimination—that the employees had been discharged because of their disabilities. But the employer claimed that the discharges were justified as a bona fide occupational requirement (BFOR).
The arbitrator rejected the employer’s argument:
• The employer had no policy on how long it would wait while an employee was off work until it would discharge; and
• The employer’s decision to discharge the employees was to save money on benefit premiums.
While the desire to save money was not in itself an indication of bad faith or malice, it also wasn’t automatically a BFOR. As there were no frustrating events—nothing happened that altered the situation that had existed for each of the three employees for years—the arbitrator concluded that the employer’s decision to discharge them was at a random point in time. As such, the employer’s decision to discharge the employees was discriminatory.
What does this mean?
Canadian employers were always well-advised to be cautious in discharging employees for non-culpable absenteeism. In light of this decision, employers must be doubly so. They must consider not only the employee’s length of absence and whether there is a reasonable prospect of him or her returning to work (whether in a regular or accommodated position) in the foreseeable future, but also what has triggered the decision to discharge. Only by considering this trigger can a Canadian employer ensure that its decision isn’t arbitrary or otherwise discriminatory.
To that end, we suggest that employers in every province implement a policy outlining how they will approach innocent absenteeism.