Written on behalf of Peter McSherry
Federal Government Announces Emergency Relief
Canada has created a new source of funding for workers who do not meet the test of traditional Employment Insurance benefits. Non-traditional employees such as freelancers, contract workers or those who earn other forms of income and who have not paid into the Employment Insurance scheme will be eligible for special emergency payments.
Such workers who have lost income due to the impact of the coronavirus and the need of a pre-cautionary quarantine, illness, to care for a family member who is ill, or to attend to child care needs will be eligible for $2,000 a month for four months. Persons who have been on EI sickness benefits who have met the 15-week maximum entitlement and remain unemployed due to a coronavirus related issue are also qualified. There is no medical report required.
To be eligible, applicants must be able to demonstrate an annual income of at least $5,000 for the 12-month period prior to the application.
Short-Term Disability Insurance
This is a good time to dust off that brochure on disability insurance. There are two basic forms of disability insurance which are often similar in content. These are (1) group insurance from your employment and (2) private disability insurance.
It is important to understand the workings of such insurance, as it can be somewhat complicated.
Short-term and long-term disability insurance is often provided by one’s employer as an employment benefit. If not, you will be eligible for EI payments for 15 weeks, as described in the most recent post.
In most cases of coronavirus infection, short-term disability insurance (STD) will be the most important issue, as the infection will be hopefully remedied well within the 6 month short term disability period.
The terms of the short term disability payments are often set out in a workplace manual. Read it carefully as most policies likely do not anticipate the present need to quarantine as a matter of caution. Many STD policies may well state that the plan pays a replacement salary only when an employee is medically unable to work.
Get advice as soon as possible on this issue. At worst, you may need EI for the quarantine period and then go on the STD plan, if required for illness.
Disability insurance companies require that you be medically disabled and unable to do your job for a period of 3-6 months. In order to qualify, an employee must generally be continually disabled for this time period.
Disability insurance is usually not a full income replacement but instead is based on a formula, such as 2/3 of an employee’s prior base salary up to a stated maximum. Your policy will define the test for eligibility. Sometimes you need to show simply that you cannot perform your prime responsibilities. Some policies require you to show that you cannot perform “any job for which you are reasonably skilled and qualified” by virtue of your work experience and education.
Long Term Health Implications
Should an employee suffer long-term repercussions owing to COVID-19 infection, they may be entitled to benefits beyond STD. Long-term disability insurance often begins once the period for STD runs out. The test to qualify is usually one of two thresholds: the inability to perform one’s job, or the inability to perform any job for which the employee is reasonably skilled or qualified. Our courts have interpreted this to mean any job that pays at least 2/3 of a person’s prior income.
Canada Pension Plan (CPP) also allows for disability payments for long-term serious illnesses. The 2020 cap on CPP disability is $1,387.66 monthly. CPP also provides a dependent disability claim to the cap of $300 per child per month. CPP has loosened the application process should your application be coronavirus-related. No medical report is immediately required. This is very unusual as the test for CPP is a rigorous one of showing a disability which is “severe and prolonged”. The adverb is “immediately”. A medical report will likely be required eventually.
All policies have a standard clause requiring that an employee is in “active employment” when they first become ill to qualify for disability insurance. If the employee is absent from work and needs to take a period of quarantine first, then please take note. Insurance companies have not anticipated this pandemic. They are not necessarily your friend. They may deny coverage because you were not in “active employment” due to the quarantine issue. This may be a losing argument, but they may well, nonetheless due to an expectation of a dramatic increase in claims, attempt to make it. Be careful. It may be advisable to obtain a medical note for the quarantine period stating that you are also unable to work due to mental anxiety to cover this defence.
In our last post, we reviewed the new Ontario law which prevents a company from terminating you due to coronavirus issues. This is good news, indeed. The trick here is that the company must have taken such action because of the coronavirus related issue. This could be hard to prove.
Human rights law also protects you from action taken against you because of a disability or a perceived disability, which would likely include a quarantine related issue or a leave to care for an infected family member.
Human rights cases are easier for the employee to win as the employee must show only that the disability issue was “influential” as opposed to “the reason” for the termination or other discipline.
Occupational Health & Safety Insurance
As promised in the most recent post, the Occupational Health & Safety Act has whistleblower protection built into the law. An employer is not allowed to take retaliatory action against a worker for reporting unsafe working conditions or taking any similar action under the Act. This need not be a refusal to work. If there is a termination in this context, the employee has a claim for reinstatement and back pay. Unlike the new Ontario law and also unlike human rights cases, the employer is presumed to have acted unfairly and must show affirmative evidence to rebut this. This is hard to do and as such, this is a very powerful employee remedy.
Complex Issues Require Experienced Advice
In these chaotic and crazy times, this is not the moment to be flying solo. We will continue to provide updates relating to employment issues and the coronavirus as they develop. If you have questions or concerns related to your employment and COVID-19, contact the offices of Guelph employment lawyer Peter McSherry. We can guide you through the issues, help you understand your rights, and defend your position. Contact us online or by phone at 519-821-5465 to schedule a consultation.