Can my Long-term Disability Benefits be Terminated if I’m Fired

If you’re receiving long-term disability benefits under your employer’s insurance plan, you might be wondering if you could be fired while you’re still disabled and whether your disability benefits will continue.

What happens if you’re fired just before becoming disabled?

In Ontario, if you are dismissed from your job and had LTD coverage under your employer plan, your employer is required by law to continue your LTD coverage for a minimum of one week for every year of employment, up to an 8-week maximum.  This is the statutory minimum for LTD benefits but some employer-provided plans specify a longer period for disability coverage when an employee is terminated. 

Can you be terminated while on long-term disability?

Employers are obligated to make accommodations in the workplace to allow employees on LTD to gradually return to work.  In the same vein, the injured person must make a reasonable and best effort to perform their job in their modified capacity, given their current abilities and state of health. 

Persons who are receiving LTD benefits cannot be fired ‘for cause’, even if they are unable to perform the modified duties they were assigned.  However, an employer may declare the employment contract with the person receiving disability benefits as ‘frustrated’ and terminate the employee if the employer has made a fair and appropriate effort to provide workplace accommodations so that the person can gradually return to work, but the employee continues to be unable to perform any work for which they are reasonably suited, and are unlikely to be able to return to the job in the reasonable future. Terminating an employee on disability is a step that cannot be taken lightly by employers and they are expected to make certain that every fair step was taken to accommodate the disabled employee.

Will you lose your LTD benefits if you are terminated from your job?

If you are receiving disability benefits and you lose your job, your benefits cannot be terminated before the end date for LTD coverage specified in the disability plan, as long as you continue to be ‘totally disabled’. This means that being fired should not impact the disability benefits you are already approved for and/or receiving..

Depending on the terms specified in your LTD plan, you may be eligible for disability benefits until the age of 65, or for a specified number of years (usually 2, 5 or 10 years).  However, after two or more years of becoming disabled, your LTD insurance provider may require you to prove that you are still ‘totally disabled’ and unable to perform any work to which you are suited in any occupation.

If your disability benefits were unfairly denied or terminated, talk to an experienced ILO disability lawyer to find out how we can help get you the benefits you are owed.