Employment Issues and Long-term Disability FAQ

Is there any connection between employment law and long-term disability law?

Absolutely. Individuals on long-term disability (LTD) often have work-related issues they need help with, and individuals with work-related concerns often have issues with their LTD insurers.

Although it is important that you are aware of the interaction between these two areas of law, it is even more important that your lawyer has the necessary knowledge and experience in these matters to ensure that you maximize the amount of money you ultimately recover.

Below are answers to some of the most common questions we receive about the interaction between employment law and LTD.

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If your disability arises due to a toxic work environment, do you qualify for LTD?

It depends. A toxic work environment may mean an employment issue rather than an LTD issue. Insurers sometimes deny LTD claims in these situations by arguing that the disability is “situational” rather than a “generalized condition.” This means that they do not have an obligation to pay you LTD benefits if the sole reason that you cannot work is a toxic work environment. In other words, LTD insurance is not “bad boss” or “bad workplace” insurance.

In situations where you cannot work only at your specific workplace due to a toxic work environment, you may have a claim for constructive dismissal. Our employment lawyers have extensive experience in such cases and can help you.

WATCH: Disability lawyer James K. Fireman discussed situational vs. generalized conditions on a Season 3 episode of the Disability Law Show.

However, in cases where a person develops a disabling condition such as severe anxiety, depression, PTSD, etc. due to a toxic workplace environment, and where the disabling condition is no longer exclusive to, or confined to the actual workplace that gave rise to it, then the LTD insurer is obligated to pay LTD benefits because the disabling condition has become “generalized.” In other words, it is now your disabling condition that prevents you from working, rather than your workplace.

In such cases the disabled individual is not only unable to work at their original workplace, but at any other workplace as well. Hence the disability is not “situational” (i.e., tied to a specific situation/workplace), but rather “generalized” (i.e., you generally cannot work anywhere). We resolve such causes regularly with insurers when claimants are suffering from generalized disabling conditions.

Read our blog on long-term disability claims and toxic workplaces to learn more about this issue.

Can you be fired while you are on LTD?

Yes, but that is illegal. If you are let go from your job while on disability or while applying for disability, your employer is likely in breach of the Human Rights Code. This means that you are entitled not only to severance pay from your employer (which we can assist you with), but also, potentially, human rights and/or other damages.

SEE ALSO
• What is a wrongful dismissal?
• How to calculate severance pay
• Pocket Employment Lawyer

It is important to understand the human rights aspect of this situation because, in the hands of an experienced employment and disability lawyer, it means structuring a potential settlement with your employer in such a way as to minimize the impact on your LTD claim.

If your employment is terminated, can that affect your LTD claim?

Yes. LTD insurance policies often contain provisions that entitle the insurer to a credit for any severance or “other income” you receive or are entitled to. This means that if you are let go from your job while on LTD (or while you are in the process of applying for LTD), your insurer may claim credit for 100% of the severance you receive.

If you’re navigating severance and LTD benefits, understanding how severance impacts long-term disability is essential to protecting your rights. Consulting Samfiru Tumarkin LLP can help ensure your severance agreement is structured to minimize offsets and maximize your financial recovery.

There are ways to minimize this which includes structuring a settlement with your employer that takes into account other types of damages that you are potentially owed (such as general damages – i.e., damage for pain and suffering, human rights damages, etc.)

If your LTD claim is denied, can that affect your employment?

It should not. Whether your LTD claim is denied or not is an issue between you and your LTD insurer, not between you and your employer.

However, if your employment is somehow affected by the denial of your LTD claim, or if your employer is not accommodating your disabling condition as per your doctor’s recommendations, contact us and we will assist you. Moreover, we strongly advise that you contact us if your LTD is denied for any reason.

What happens if you become disabled before your employment has been terminated?

So long as you had LTD coverage when you became disabled, you should be able to apply for and claim LTD.

In some cases, individuals apply for LTD after their employment has ended but the disability arose while they were still actively employed. In such cases the LTD insurer should pay LTD benefits because the disability arose during the time that you had LTD coverage, irrespective of the fact that at the time of application you were not actively employed. You must look at your specific LTD policy provisions in this regard and if you have questions, contact us for a free consultation.

What happens if you become disabled after your employment has been terminated?

If you become disabled after your employment has been terminated, then your eligibility for coverage depends on whether your employer kept the LTD coverage for you for the requisite notice period. It also depends on the specific provisions of your LTD policy.

Many LTD policies require you to be “actively working” when you become disabled. If you are not actively working when your disability arises then you may not be eligible for LTD coverage. Again, review your specific LTD policy provisions in this regard and feel free to contact us anytime for a free consultation if you have questions about your situation.

What happens if your employer is supposed to pay you LTD (rather than an insurance company), but has denied your claim?

Some employers (usually larger companies like banks) are the ones that pay both short-term and long-term disability benefits. They usually hire an external company (often an insurance company) to manage these claims, but the employers themselves are the ones paying these benefits.

In such circumstances it is very important to get the advice of an experienced employment and LTD lawyer. Although the issue you may be experiencing is with respect to the non-payment of your LTD benefits, your employer is the entity that is not paying you, which means that any legal claim you have against your employer (for the STD or LTD benefits you are owed) will likely trigger potential employment issues. Thus, the interplay between employment law and LTD law becomes even more apparent in such situations. We deal with these kinds of circumstances regularly and resolve claims of this nature often.

Questions? Concerns? Contact Us!

If you are experiencing an issue anywhere in Canada (excluding Quebec) with your long-term disability claim, your employer or the insurance company, we’re here to help. Call our team at 1-855-821-5900, email Help@DisabilityRights.ca, or contact us online for a FREE consultation.

You can also post your specific question about your long-term disability claim online for a quick answer by a disability lawyer at Samfiru Tumarkin LLP, at MyDisabilityQuestions.com.

As Canada’s most positively reviewed disability law firm, we have the experience, tenacity and determination required to provide you with the advice you need, and the compensation you deserve.