Terminating an Employee Without Reasonable Notice Results in Employer Paying for 26 Years of LTD Benefits:

In Pasap v Saskatchewan Indian Gaming Authority and Bear Claw Casino ( 2022 SKQB) Justice McMurtry had a situation where there was an issue as to whether the employee was fired or resigned. Having found that the Defendant had given him an ultimatum to quit or be fired, the Court found that he was fired and should have received 8 months notice.

Two months after his termination, the Plaintiff ( who was only 38 years old) suffered an serious medical event which the Judge found made him disabled for the rest of his working life. Because the Defendant had not continued his LTD coverage through the notice period, they became liable for 26 years of LTD benefits ( until he turns 65) , which came to $1,216,764 plus 8 months notice, plus $25,000 in aggravated damages plus $25,000 in punitive damages plus costs.

Comment: This case illustrates the massive risk that an employer takes when they improperly cut off important benefits prematurely like LTD or life insurance. If this was simply a LTD denial case with an insurer the Court would not order the payment future benefits as a lump sum, rather the Court would award past benefits and put the Plaintiff back on claim. This could not be done in this case because the defendant was not an insurer.

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