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Canadian court ruling seen as guidepost on firing injured workers

Canadian court ruling seen as guidepost on firing injured workers

OTTAWA—A recent Supreme Court of Canada decision provides guidance for Canadian employers with unionized workforces about how far they must go to accommodate employees disabled by illness or injury before terminating them.

While the Supreme Court did not set a specific standard for reasonable accommodation and stated that each case must be decided individually, the decision provides employers with a broad outline of expectations regarding their duty to accommodate, lawyers say.

In its Jan. 26 decision in McGill University Health Center vs. the Union of the Employees of Montreal General Hospital, the Supreme Court validated a decision by McGill University Health Centre in Montreal to terminate a disabled employee due to her prolonged absence, finding that a termination clause in the collective bargaining agreement with the employee's union had been appropriately applied.

In March 2000, Alice Brady took a leave of absence as a medical secretary for McGill University hospital due to what court records described as a "nervous breakdown." When she tried a gradual return to work, the hospital reduced her schedule and extended her rehabilitation period several times, despite the fact that the collective bargaining agreement negotiated by the hospital and her union allowed a maximum of six months. Even with the accommodations, Ms. Brady was unable to return to work full-time.

The collective bargaining agreement also included a clause that provided for automatic termination after an absence of 36 months. In March 2003, the hospital notified Ms. Brady that her employment would be terminated due to her prolonged absence, leading to a grievance dispute with the union.

A grievance arbitrator ruled in favor of the hospital and a Superior Court rejected the union's request for review. However, the Quebec Court of Appeal ruled against the hospital, leading to the Supreme Court appeal.

An automatic termination clause is a significant factor in assessing the employer's duty to accommodate, the Supreme Court ruled, because it is negotiated by parties representing different interests who are most familiar with the workplace.

Canadian employers have been puzzled by how long the employment relationship can continue without a return to work because human rights laws regarding the duty to accommodate are "very demanding on employers," said Douglas Gilbert, a Toronto-based partner in the labor and employment group of Heenan Blaikie L.L.P.

The Supreme Court's recognition of the relevance of automatic termination provisions to the employer's duty to accommodate provides unionized employers with a partial understanding of what the expectations are for them, he said. "I think it's most important for the recognition it gives to paying attention to what unions and employers have defined as a reasonable absence," Mr. Gilbert said.

The court expressly stated that automatic termination clauses do not definitively determine the specific accommodation measure an employee is entitled to, because each case must be evaluated separately.

The court did rule, though, that the three-year period provided for in the union contract represented a reasonable accommodation. If there are future challenges relating to the duty to accommodate time frame, it is likely that arbitrators will view three years as a reasonable standard, Mr. Gilbert said.

Three years, though, is not as relevant as the court's recognition that parties to a collective bargaining agreement—because of their extensive knowledge of the particular workplace—have the right to negotiate clauses to ensure employee attendance, said Connie Reeve, senior partner in the labor and employment practice of Blake, Cassels & Graydon L.L.P. in Toronto. The duty-to-accommodate provision in human rights legislation was an area of law where there was some doubt as to how much weight could be given to automatic termination clauses, she said.

The case reinforces for employers that automatic termination clauses should have fairly lengthy time frames, said Jacques Laurin, a Montreal-based labor and employment lawyer with Colby, Monet, Demers, Delage & Crevier L.L.P., who represented the hospital.

An employer, though, must review each situation individually to determine if accommodating an employee would cause undue hardship for the employer—the standard in many provincial human rights laws, including the Quebec law in this case, employment lawyers say. "Whether or not undue hardship is created is a question of fact," Ms. Reeve said.

Nonunion employees

While the case relates specifically to automatic termination clauses in collective bargaining agreements, the Supreme Court's reasoning has implications for nonunion employees, employment lawyers say.

For example, provisions defining the consequence of absence for a fixed period are found in employment contracts and human resources policies, and the McGill University case would be relevant to provisions addressing the direct termination of employment or any reduction of benefits, Mr. Gilbert said. In a nonunion relationship, though, a court likely would be more vigilant to ensure the accommodation is reasonable and adequate for the employee's circumstances given his or her relative lack of bargaining power, he said.

McGill University Health Center vs. the Union of the Employees of Montreal General Hospital, 2007 SCC 4; Jan. 26, 2007.