Employee absenteeism is a big topic, and encompasses many different scenarios. There are many situations where, if an employee fails to show up to work for some time, the employer would be justified in terminating the employee without notice or payment in lieu of notice. This is quite easy to understand where the absence is reckless, irresponsible or otherwise unexcused.
The unfortunate reality though is that people get sick, acquire disabilities and experience a worsening of existing disabilities. Would an employer ever be justified in dismissing an absent employee in cases where the employee’s absence is due to illness or disability employees are absent due to any of these causes? How could employers justify firing an employee for an illness related absence without any notice or payment in place of notice? What about the employment contract between the parties – whether in writing or implied? And how long would the absences need to be before being at risk for termination with cause?
These questions apply to any situation of termination of an employee due to absenteeism; but where the absence is due to causes that are completely out of the hands of the employee – where there is no intentional breach of an employee-held duty – the questions are even stronger. In these circumstances, the key is a legal principle called the doctrine of frustration. The doctrine of frustration is not unique to the employment context. In fact, it was imported into the world of employment relationships from the general area of contract law. The doctrine basically states that if – under the present, changed circumstances – the original agreement can no longer be carried out in the way it was intended to be by the parties, then neither party is entitled to damages for the termination of the agreement.
It’s important to note that employers can’t assume that they are entitled to rely on the frustration doctrine any time an employee misses a large chunk of time due to illness or disability. As “frustrating” as it may be (pun intended) to an employer when an employee needs to miss what may seem like an unreasonable amount of time, the law may require a much lengthier absence period to establish frustration of the contract. Exactly how much absence will the law compel an employer to tolerate is very case-specific. In order for an employee’s disability or illness-related absence to give rise to the frustration of an employment, one of two things must be true: (1) Either the nature of the employee’s disability must make it impossible for the employee to fulfill his or her employment obligations; or (2) The employee’s absence is likely to continue for a duration which will make it impossible for the employee to fulfill the employment obligations. (See: Antonacci v. Great Atlantic & Pacific Co. of Canada  O.J. No. 876). In either case, it is not the disability or illness which entitles the employer to back out of the agreement; it’s the fact that the employee just can’t do what was agreed upon and expected.
In the employment context, Ontario courts have held that sufficiently long absences due to chronic disabilities like fibromyalgia, depression and anxiety caused a legal frustration of the employment contract (see: Duong v. Linamar Corp., 2010 ONSC 3159, 2010 CarswellOnt 3663; and Fraser v. UBS Global Asset Management, 2011 ONSC 5448, 2011 CarswellOnt 15354).
If disability benefits were provided as part of the employment package, it will be extremely difficult for an employer to argue that the contract was frustrated. The reason for this is that if the employer had a set of circumstances in mind at the time the contract was signed, the employer can’t later say – when those circumstances arise – that this wasn’t what the employer agreed to! So if sick leave or disability benefits were included in the deal, the employer must have thought of disability-related absences as a possibility encompassed by the employment agreement.
The reality of the situation is that Ontario courts have been quite hesitant to conclude that employment contracts have been frustrated as a result of illness or disability related absences. This is so in part because of the doctrine of frustration itself, and partly due to human rights considerations and the duty to accommodate.
Ontario courts have held that absences of up to two and a half years did not frustrate the employment contract (see: Ciszkowksi v. Canac Kitchens, a division of Kohler Canada Co.  O.J. No. 85). The Superior Court of Justice has even concluded in one case that an absence of nearly five years due to mental illness did not amount to frustration of the contract! (See: Naccarato v. Costco Wholesale Canada Ltd., 2010 ONSC 2651).
What does this mean for employees and employers in Ontario? Are employees guaranteed protection from being terminated no matter how long their absence? Must employers be resigned to accept unending absences from employees who cannot fulfill their job functions? Not necessarily. As I said before and need to reemphasize, it will all depends on the facts of the case.
Practically speaking, this means that employers must be sure to obtain legal advice before taking any action in the delicate and ambiguous area of absenteeism where disability may be involved.