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An Employer’s Continuing Obligations When Outsourcing Disability Management to Third Party

An Employer’s Continuing Obligations When Outsourcing Disability Management to Third Party

By September 28, 2019March 9th, 2022No Comments

Employers across Canada are well-versed in their duty to accommodate under human rights legislation. Outsourcing disability management to outside experts is one strategy employers are using to separate such duties from their main work functions, thereby increasing concentration on core business and maintaining confidentiality in the workplace.

In Knight v. Surrey Place Centre, the Ontario Human Rights Tribunal considered employer human rights obligations and issues surrounding delegation of the duty to accommodate. The Tribunal held that while it is acceptable for employers to outsource disability management, such an arrangement does not change employers’ obligations to disabled employees:

“If the employer decides to outsource the management of accommodation of a disabled employee to an agent, the actions or failures of the agent do not lessen or alter the employer’s obligations.”

The Tribunal awarded the employee $15,000.00 in monetary compensation for “injury to dignity, feelings and self-respect”. Below are the facts described in Knight v. Surrey Place Centre.

The employee occupied a middle-management position for a long-term period. She was placed on stress leave in December 2014. The employer outsourced management of disability claims to an insurance company. There were delays in obtaining medical information from the employee’s physician. When the records did arrive, they confirmed that the employee was experiencing stress-related symptoms. The insurance company advised the employer that her medical evidence was insufficient to support her absence. By that time, the employee’s physician had recommended a return to work with the accommodations of a maximum of 40 hours of work per week and that she was working from home. Apart from a brief note, no medical evidence was provided to
explain the basis for the accommodations. The employer asked the employee to provide medical information to justify the accommodation. The employee took the position that she was not required to provide further medical information. The employer directed the employee to return to work, after which she was fired for failing to do so.

The Tribunal found that the adjudication of the employee’s stress leave was flawed. The employer failed to perform its duties under the Ontario Human Rights Code (the “Code”). The Tribunal stated that the failure to clarify and acknowledge medical evidence and the untimely decision-making process resulted in significant deficiencies in regards to the procedural duty to
accommodate. The Tribunal made it clear that outsourcing disability management to third parties does not lessen an employer’s obligations under the Code.

With respect to the employee’s requested accommodation that she works from home, the Tribunal found that the employee did not adequately participate in the accommodation process when she refused to provide further medical information. Therefore, the employer did not infringe the employee’s right under the Code with respect to this issue.

In navigating the issues surrounding outsourcing disability management, it is clear that the employer must actively perform its duties under the Code. The employer cannot turn a blind eye or fail to act as a result of its method of delegating disability management to third parties. The Human Rights Tribunal of Ontario puts employers on notice that it is prepared to award monetary compensation for injury to feelings, dignity, and self-respect when an employer violates its duty to accommodate under the Code. The Tribunal also touches on the responsibility of the employee to participate in the accommodation process.

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