Can You Be Fired While On Short-Term Disability In Ontario?

The short answer is yes, an employer has the discretion to fire an employee even if they are on short-term disability in Ontario. The long answer is it depends on the specific fact scenario. However, if the reason or part of the reason for the termination is because of your disability, that is discriminatory and against human rights law.

There are three circumstances in which you can be terminated while on short-term disability leave:

  1. The termination is unrelated to the medical leave;
  2. There has been a frustration of contract; or
  3. Termination for cause.

1. The termination is not related to your short-term disability leave

Provided the termination is not because of your disability, your employer can terminate your employment so long as they provide you with notice of pay in lieu of notice. This would be a termination without cause. The amount of the severance package you are entitled to is determined by several factors.

If you are fired because of your absence which is related to your disability, the termination would be in breach of human rights laws that protect employees from discrimination based on disability in their employment.

2. There has been a frustration of contract while on short-term disability

An employer may claim that the employment agreement has been ‘frustrated’ due to an extended disability leave of absence. A termination for frustration while on short-term disability leave is not likely to meet the threshold for frustration unless there is medical evidence that the employee is unlikely to be able to return to work at all.

Frustration of contract is the end of a contract due to circumstances that make future performance significantly different than what was agreed to or near impossible, through no fault of either party.  In this case, the employer is only required to provide the employee with their minimum entitlements under the employment standards legislation which includes termination and severance pay.

Proving frustration is a very high standard.  To show that an employment contract has been frustrated due to an employee’s disability, the employer must show there is no reasonable prospect that the employee will be able to return to work. This is very difficult to do while an employee is on short-term disability.

The courts assess whether the incapacity is such that further performance of employment obligations would be impossible or radically different from what the parties originally agreed to.

3. Termination for Cause

You can still be terminated for cause while on short-term disability leave, if your employer discovers that you engaged in serious misconduct. The consequences of bad behaviour cannot be avoided by going on a medical leave of absence. However, to meet the high standard of cause, the alleged behaviour or misconduct must also be willful or intentional. For example, theft and insubordination are grounds for termination.

What should you do if you are terminated while on short-term disability?

These issues can be complicated and overwhelming to deal with, especially while trying to recuperate. If you are terminated or disciplined while on medical leave, you can contact one of our employment lawyers to help you. We offer a free 30-minute consultation.

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