Yes. In most cases, you are still employed while receiving long-term disability (LTD) benefits.
Going on LTD does not automatically end your job. Your employment generally continues unless you resign, your employer terminates your employment, or the employment relationship comes to an end for another reason.
Your job and your LTD benefits are also two separate things. Your employer manages your employment, while the insurance company decides whether you qualify for disability benefits under the LTD policy.
On This Page:
- Are You Still an Employee While on LTD?
- What Happens to Your Job?
- Can Your Employer Contact You?
- Does Your Employer Have to Hold Your Job?
- Can You Be Fired While on LTD?
- Does LTD Continue if Your Employment Ends?
- Can You Get Severance and LTD?
- What Happens if You Can Return to Work?
Are You Still an Employee While on LTD?
Receiving LTD benefits does not, by itself, end your employment relationship.
You can remain an employee even though:
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You are not actively working
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Your LTD insurer is paying your disability benefits
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You have been away from work for a long period
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There is no confirmed date for your return to work
This is because LTD benefits and employment status are separate issues.
Your insurance company decides whether you continue to meet the definition of disability in your policy. Your employer deals with your job, accommodation and employment status.
What Happens to Your Job When You Go on Long-Term Disability?
When you go on LTD, you usually stop performing your regular job while you remain medically unable to work.
During that time, your employer can stay in reasonable contact with you about issues such as:
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Your continued absence
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Medical restrictions and limitations
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Workplace benefits
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Possible accommodations
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Whether a return to work could become possible
Your position might be temporarily covered by another employee while you are away. That does not necessarily mean your employment has ended.
Can Your Employer Contact You While You Are on LTD?
Yes. Your employer can reasonably communicate with you while you are away on disability.
However, staying connected to your employer is different from continuing to perform your regular job while you are medically unable to work.
Your employer can ask for reasonable updates about your restrictions, ability to return and accommodation needs. It generally does not need every detail of your medical condition simply because you are on disability leave.
For a detailed explanation, see Can Your Employer Contact You While on Disability Leave?
Does Your Employer Have to Hold Your Job While You Are on LTD?
There is no single Canada-wide rule saying an employer must hold your exact job for a specific number of months while you are receiving LTD.
Employers have obligations to accommodate employees with disabilities, but how long an employment relationship can continue depends on the circumstances.
Important factors can include:
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How long you have been unable to work
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Your current medical restrictions
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Whether your condition is expected to improve
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Whether a return to work is reasonably foreseeable
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Whether modified work or another accommodation is possible
Simply reaching one year, two years or another anniversary on LTD does not automatically mean your employer can end your job.
Read our detailed guide on how long you can be on LTD before termination.
Can You Be Fired While on Long-Term Disability?
Being on LTD does not give you absolute protection from termination. However, an employer generally can’t terminate you simply because you have a disability.
A termination while you are receiving LTD can involve several separate issues, including:
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Whether the employer properly accommodated your disability
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Whether there was a realistic possibility of returning to work
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Whether you are owed severance
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What happens to your LTD benefits after your employment ends
Do LTD Benefits Continue if Your Employment Ends?
They can.
If you became disabled while you were covered by the LTD policy and continue to meet its requirements, the end of your employment does not necessarily mean your disability payments stop.
The exact answer depends on the wording of your LTD policy and the circumstances of your claim.
This is one reason you should be careful about assuming that your employer and your LTD insurer will make the same decision at the same time.
For example, an employer could terminate your employment while the insurer continues paying LTD benefits. The reverse can also happen: an insurer could stop paying LTD while you technically remain employed.
Can You Receive Severance While on Long-Term Disability?
Yes. If your employment is terminated while you are on LTD, you can still be entitled to severance—which can be as much as 24 months’ pay.
Being unable to work does not automatically remove your severance rights.
However, severance and LTD benefits can interact. Depending on your disability policy and how the severance is paid, the insurer can take the position that some payments affect the amount of LTD benefits you receive.
That is why it is particularly important to get advice before accepting a severance package while receiving disability benefits.
See our guide to severance packages and long-term disability benefits.
What Happens if You Become Able to Return to Work?
If your condition improves, you do not necessarily need to go directly from being completely off work to immediately performing your full job.
Depending on your medical restrictions, a return could involve:
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Reduced hours
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Modified duties
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A gradual increase in your workload
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Temporary workplace accommodations
Your treating medical professionals should provide information about what you can safely do. Your employer can then consider what accommodation is available.
Your LTD insurer should also be involved because returning to work can affect your disability benefits.
Read our complete guide to returning to work after long-term disability.
Should You Resign While You Are on LTD?
Be very careful about resigning while receiving long-term disability benefits.
People sometimes assume they should resign because they have been away for a long time or don’t know when they will be able to return.
That is not necessarily required.
Resigning can affect important employment rights, including a potential severance entitlement. It can also create unnecessary complications around your disability claim and workplace benefits.
Get legal advice before resigning if you are still unable to work because of a disability.
Frequently Asked Questions About Employment While on LTD
Am I still employed if I am receiving long-term disability?
Usually, yes. Receiving LTD benefits does not automatically terminate your employment. You generally remain employed until you resign, your employer terminates you, or the employment relationship otherwise legally ends.
How long can you stay employed while on long-term disability?
There is no universal time limit. Some employees remain employed while receiving LTD for a considerable period. Whether the employment relationship can eventually end depends on your circumstances, including your medical outlook and whether a return to work is reasonably possible.
Can my employer replace me while I am on LTD?
An employer can need someone else to perform your duties while you are away. Having another person perform your work does not, by itself, mean your employment has been terminated.
Can my employer terminate me after two years on LTD?
There is no automatic rule allowing an employer to terminate you simply because you have reached two years on LTD. The two-year point is often important for disability insurance because many LTD policies change their definition of disability around that time, but that is separate from whether your employment can end.
Can I still receive LTD if my employer fires me?
Potentially, yes. If you became disabled while covered and continue to satisfy the LTD policy, termination of employment does not automatically end an existing disability claim.
Can I get severance if I am on LTD?
Yes. If your employment is terminated, being on LTD does not automatically eliminate your entitlement to severance. Get advice before accepting a severance offer because the payment can also interact with your LTD benefits.
Get Advice About Your Job While on Long-Term Disability
Your employment and your long-term disability claim can continue at the same time, but problems can arise when an employer starts discussing your return, termination or severance.
If you are receiving LTD and are concerned about your job, don’t resign, accept a severance package or make a major return-to-work decision before understanding how it could affect both your employment rights and disability benefits.
Samfiru Tumarkin LLP helps people with long-term disability claims across Canada, excluding Quebec, as well as employment-law matters in Ontario, Alberta and BC. Our long-term disability lawyers can deal directly the insurance company and get you what you’re owed.