The employee was assured he would be eligible for the benefits after he had completed the three-month probation period. (Photo: iStock)
Employers should be very cautious when making promises to employees, because they could end up causing problems down the line.
That is the situation in a recent court case in which a company was found to have wrongly assured an employee, who has a genetic disorder, about long-term disability benefits.
The employee suffers from cystic fibrosis, which is a fatal genetic disease that mostly affects the lungs and the digestive system and presents many health challenges.
Before the employee was hired in 2012, he wanted to know whether he was eligible for LTD benefits. Though the company offered him employment after the second interview, the employee was more cautious due to his illness, and said “he would not accept employment unless it offered sufficient and appropriate long-term disability benefits.”
The employee was assured he would be eligible for the benefits after he had completed the three-month probation period.
Six months after the employee had been hired, he started getting complications from his disorder and missed work. A few months after he returned to work, he got sick again and started inquiring about his LTD benefits, especially as he was being assessed for a double lung transplant because of his deteriorating condition.
Eventually it came out that he was only eligible for a limited amount of coverage because he didn’t fill out a health questionnaire. That greatly reduced his benefits and he ended up receiving little more than $36 per month. In addition, his employment also terminated in late 2013 but that didn’t affect his LTD entitlement.
In 2014, he sued his former employer for damages, due to misrepresenting his LTD eligibility, which caused him financial loss.
The court ruled in the employee’s favour, by accepting that the employer had made these assurances that he would be eligible for LTD benefits after the probationary period. The employer’s assurances proved to be untrue and that caused him financial loss.
As a result, the court awarded the employee $93,336.80 in lost benefit coverage, which included $10,000 for mental distress.
The employer is appealing this decision.