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Can you fire an employee on medical leave?

A concept photo of medical leave. Stock photo by Getty Images

Here’s a thorny legal and HR issue to give pause to even the steeliest of employers: firing an employee who’s on medical leave.

It might sound like an open invitation to a lawsuit, but employers have rights too. You can terminate an employee on leave, with a few caveats, of course.

You can’t fire someone because they’re sick or you’re unhappy that they’re taking medical leave. Federal and provincial human rights laws prohibit discrimination on the grounds of disability, and some businesses have paid the price for firing ill employees.

An employer has a legal duty to accommodate sick or disabled employees. This can mean granting medical leave or changing their duties to allow them to continue working.

There are limits, though. Generally, there are two situations in which you can fire someone on medical leave:

Undue hardship: this means that accommodating the ill employee puts an unreasonable strain on your business. This is a relative measure and courts or tribunals set a high threshold. It can consist of multiple criteria.

  • Cost: the actual, quantifiable financial costs of accommodating the employee, as well as reasonably foreseeable future costs. This could include lost revenues or costs to modify workplace premises or equipment. However, this wouldn’t include the costs to install facilities already required by local building codes, such as wheelchair ramps.
  • Health and safety risks: in other words, would accommodating the sick employee put others at risk? This might include a worker with a highly contagious disease, who can’t reasonably work in an office with others.
  • Workplace disruption: an accommodation that severely hampers workflow or productivity could be considered another form of undue hardship.

Unrelated termination: This means the firing has nothing to do with the employee’s leave or disability, it just happened at that same time.

An employer should be able to show why they fired the employee at that time though, whether it was part of a round of layoffs, due to a lack of work, budget cutbacks or other issues. If the terminated employee launches a complaint, you need hard proof the termination was necessary.

Firing can also be a disciplinary step, and employers must be careful on this front as well. Courts and tribunals generally take a dim view of employers who fire any workers — on leave or not — on the first offence without any attempts to warn them or correct behaviour.

An employer should be able to show that this termination was justified. If the employee in question was sub-par, keep documentation of performance reviews, written warnings or other disciplinary steps taken before firing.

Axing an employee on leave looks inherently suspicious, so a smart employer will show that it was done with good reason. If not, you’ll likely face an uphill battle in court.

Read more:

Firing an employee: what to know

Duty to accommodate

What is undue hardship? (Ontario)