Ltd buy out question


I have been receiving Ltd payment through my employer since Dec 2016 and have been offered a buy out. The amount is equivalent to 14 months of Ltd payment. So basically it is 13 months until I hit the 2 yr mark and my disability discription changes from current occupation to any occupation.
As of right now I am waiting for a hearing implant and am not working due to deafness as well as vertigo. My surgeon has stated the implant will be done and I should be able to return to work within 7 months if successful. My surgeon also states the vertigo I continue to suffer with is no longer
caused by my hearing or my inner ear. By taking a lump sum payment I will be terminating my employment and loosing all Ltd future payments. Does it make sense that they would offer a buy out so early in and could this be my employer trying to severe their legal obligation to accommodate once I am able to return to work? Should I take the settlement or wait it out? The insurance company is also saying the settlement is no negotiable but won’t say if they might offer another amount at some point.


Definitely get legal advice and weigh your options. Not likely your best option unless you are sure of recovery and employment. You may also be giving up severance.


So if I am found to not be able to return to my current occupation at the 2 yr mark would I be entitled to severance from my employer? I never considered that in the equation. As far as recovery I will know nothing until after my next surgery which I don’t even have a date for yet. So many unknowns. Thanks for the reply


You’re probably not entitled to it but your employer may offer something.
They may just terminate you for frustrating the employment contract.


There are statatory -federal or provincial-obligations to pay notice pay! They can terminate your employment–but you are entitled to notice pay. They have a heavy burden to say frustration of contract! Individuals who have been off on disability for over 5 years have been successful in wrongful termination claims. Best to review with a lawyer if issue comes up.


This is not correct—You are likely entitled


I heard that somebody at my company was on sick leave for over 20 years and they didn’t terminate her but she tried to go back to work several times and failed. Does it mean that they may keep me employed for as long as I am on LTD?


I would like to hear David’s opinion as to wether an employer is obligated to pay severance when an employment contract is frustrated.


It is possible, it depends on the employer but there is no obligation to.


Absolutely–it is hard to justify terminating a person who is on disability and often not worth the fight. Frustration of the employment contract can be difficult to prove so many employers will just keep you on extended leave.


Seek legal advice if ever your employer is seeking to end your employment due to disability. They may have legal obligations to pay you statutory pay or may be guilty of wrongful dismissal or human rights complaint. Just because you are likely never going back does not mean you should accept that your employer owes you nothing or is not obligated to keep a job for you—even if it is years.


That is really good advice for everyone.


It is never in your favour or to your benefit when insurance company does this. You do not know at this point until after you have surgery how you will be. They however, know that you may have years of rehabilitation and accommodation ahead of you. So they are trying to cut their future losses. Do not buy into this. Keep on your LTD as long as you require and until you are fully capable of returning to work. When and if you return to work you will have a certain amount of time for the same disability (one year for most) to continue your LTD claim if the Return is not working out. Let them know that at this time you are not interested in a buy out and that there are too many unknowns in your future working capability in any occupation. Remember, this insurance is your income safety line, do not sever it until you are confident and capable of returning to any work. Recall that to return to “any” work must be at least at or better than 66% of your current salary.


Thanks so much for all the great input. I think I’ll say no to the buy out and see where I end up at the 2 yr point. In terms of entitlement to severance pay it appears my Ltd would take this as outlined in my policy so I will fight to stay on with my current employer as well.


I’m very surprised that they have entitlement to your severance. If that is the case do not leave the job unless you get LTD forever. (Usually to age 65).

Cherylynn Hunt :grinning: