Employers Must Be Reasonable Towards Employees on Medical Leave

Sandhu v. North Star Mills Ltd. – British Columbia Supreme Court – August 13, 2007

Employers need to be reasonable when ascertaining whether or not an employee will be returning to work from medical leave and in determining whether the employment contract has become frustrated due to the employee’s absence.

The August 13, 2007 decision reached in Sandhu v. North Star Mills Ltd. [2007] B.C.J. No. 1797 (“Sandhu”) is a warning to employers that they must be reasonable when considering whether an employee who is on medical leave will return to their employment and whether the medical leave has frustrated the employee’s employment contract.

The employee in Sandhu was injured in a motor vehicle accident in June of 2005 and suffered soft tissue damage as a result. The employee informed his employer that he would not be able to return to work for some time. Little communication occurred between the employee and employer once the employee went on medical leave.

In October or November of 2005, the employee contacted his employer and informed him that the insurance company who provided the employee’s benefits while on medical leave wanted a letter from the employer indicating whether or not there were any light duties that the employee could fulfill while he was still injured. Being advised by the employee that “he was in a lot of pain”, which gave the employer “the impression that he was chronically ill and not able to perform his job or any other job” the employer informed the insurance company that no such duty existed. The employer construed the employee’s description of his physical state as an indication that the employee was not going to return to his employment and decided to find a replacement for him.

By September of 2006 the employee felt as if he could return to work and discussed this with his doctor and physiotherapist. He decided to wait until October of 2006 in order to make sure he was fully recovered from his injuries and then contacted his employer about returning to work. In November of 2006, the employer responded to the employee with an offer to employ him as a temporary employee, which offer the employee declined. In response, the employer sent a letter to the employee’s lawyer stating that the employee had quit his employment and that no severance package would therefore be provided. The employee commenced an action against the employer for wrongful dismissal.

The Trial Judge found that the employee had been wrongfully dismissed and awarded the employee twelve month’s notice. Though the employee’s injuries disabled him for a considerable duration, the Trial Judge stated that the “nature of the illness was such that recovery could be expected.” On this point, the Trial Judge concluded that the employee’s “illness due to injury was temporary and that it was not such as to put an end, in a business sense, to the business relationship which he had with [the employer]. I find that the contract of employment had not been frustrated as a result of [the employee’s] absence due to illness when [the employer] refused to allow him to return to his position.” Therefore, the employer was wrong to conclude that the employment relationship had ended.

The decision that was reached by the Trial Judge in Sandhu demonstrates the level of reasonableness that is expected of an employer when it comes to dealing with an employee who is temporarily away from work on medical leave. An employer is not permitted to simply assume that an employee will not be returning to work or that the employee’s absence has frustrated the employment contract. Rather, the employer should be reasonable when considering the amount of time that an employee has been on leave and in ascertaining whether the employee has an intention to return to their employment when their leave is finished in considering when the employment contract has been frustration.

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