Can long-term disability affect employment contracts in Ontario?

August 7th, 2018 in Employment Contracts


There may be many reasons an employee misses work. But when employees in Ontario are off work for an extended period, can their employment contracts be affected? There are certain instances when employers may claim frustration over a contract even when the employee is on long-term disability.

In one instance that went before the courts, an employee had been working for a company for 10 years when a medical condition caused him to take a leave of absence. The insurance company approved his claim for long-term disability and advised the company for which he worked that he was permanently disabled for any occupation. Three years after the man had been on disability, his employer let him go, claiming frustration of contract.


The man sued for wrongful dismissal, claiming that the company didn’t ask him for any information and had they done so, he would have told them that his condition was improving. But a judge ruled that the employment contract was frustrated. In other words, it was unlikely the man would return to work anytime in the near future. The judge allowed the insurance company’s information as evidence that the employee was not likely to work again.

Employment contracts can be extremely complex and confusing. It may take the experience of an Ontario lawyer to explain the legalese with which they’re often written. A lawyer may also be able to ensure that a written contract is in line with what was discussed verbally between his or her client and the client’s prospective employer.