Worker on LTD entitled to sick leave accrual

When a long service worker returned to work, her sick leave credits were not restored according to the formula set out in the collective agreement
|Canadian Labour Reporter|Last Updated: 05/13/2013

R.A. began working for Ontario Hydro in 1990. She went on long-term disability (LTD) in December 2003, her 13th year of employment.

Under the sick leave plan negotiated in the collective agreement, workers were entitled to eight days sick leave per year paid at 100 per cent of salary.

Workers were also entitled to 15 days sick leave per year paid at 75 per cent of salary. Under the plan, the entitlement to eight days per year at 100 per cent was unlimited. However, the entitlement to 15 days at 75 per cent of salary was limited to 200 days.

Beyond the annual refreshment of the eight-day entitlement, the plan also contained a formula to restore sick leave credits for long-service workers.

Under the plan, workers with between six and 14 years’ service had the sick days that they used in the calendar year five years previous restored to them.

Sick leave restoration

Workers entering their 15th year received an extra bonus. For those workers, their used sick leave for the previous four years was restored to them.

After 16 years’ service — and from then on — a worker’s used sick leave credits from the year two years previous were restored.
R.A. returned to work on Oct. 7, 2005. Based on her original start date, her next sick leave accumulation date was Jan. 1, 2006. R.A. was then in her 16th year as her service credits (or seniority) continued to accrue while she was on LTD.

As she was in her sixteenth year, the plan reached back two years to restore the sick leave she had used in that year. However, R.A. had used no sick leave in that year because she was on LTD. Consequently no sick leave credits were restored.

Moreover, R.A. missed out on the four-year credit restoration that should have occurred in her 15th year.

The employer said that because of the timing of her LTD, R.A.’s sick leave credit restoration entitlement was frozen at her 13th year. She skipped over years 14 and 15 and then returned in year 16 and was awarded the credits for the sick leave she used two years previous, i.e. zero.

The union grieved.

Arbitrary and discriminatory

The union argued that R.A. was entitled to the sick leave restoration due to her according to her total service credits, which continued to accumulate while she was on LTD. The union said that the employer’s interpretation of R.A.’s entitlement to sick leave restoration was implausible, arbitrary and discriminatory.

As the union calculated it, after R.A. returned from LTD, she was due the 34.65 days of sick leave credit — for the sick leave she used in her tenth year — for her 15th year of service as spelled out in the plan. Also, according to the plan, she was entitled to the top-ups for years 11 through 13, for a total of 83.57 days.

The employer argued that the service credits, or seniority, acquired during periods of LTD did not count for determining benefit entitlements but instead were calculated solely for the purpose of representing years of service. The employer said that sick leave restoration for employees returning from LTD worked in the same way that vacation entitlements were handled for returning workers.

In these circumstances, the employer said, while a worker’s service credits would continue to accumulate while they were on LTD, their vacation credits would only start to accumulate after they had returned to work. The employer also said that the collective agreement granted it much discretion in applying its sick leave plan.

The Arbitrator found for the union.

The Arbitrator agreed that the employer had significant discretion in applying the terms of the plan. However, the employer was obliged to observe the results that flowed from applying the clear provisions as laid out in the plan.

The formula for using service credits to calculate sick leave restoration was clearly distinguished from the process for calculating vacation credits for workers on LTD, the Arbitrator said.

“[T]he parties do not say that restoration of sick leave credits ‘will start’ based on the total service credit. They say [in the collective agreement], ‘restoration of sick leave credits will take place based on the total service credit.’ The hiatus in vacation credit is recognized by the parties. The grievor did not get any vacation credits for the years while on LTD. But, that is not the same for the restoration of sick leave credits. The restoration ‘will take place based on the total service credit.’ The credits are not just based on the final number, but on all of the service credits that were accrued during the LTD period.”

Rational labour relations purpose

The Arbitrator said that the employer’s application of the formula created an arbitrary and contingent result that was arrived at based on when R.A.’s LTD occurred. That was not what the parties could have intended, the Arbitrator said.

The Arbitrator also said that the union’s interpretation served a more rational labour relations purpose in that it provided workers returning from LTD with a cushion of restored sick leave credits to assist them in their readjustment to work.

“Accordingly, I conclude that the impact of the unbroken service accrual for an employee returning from LTD, for sick leave restoration, is not a renewal or revival of the entitlement (as with vacation credits), but an accumulation of the entitlement during the period on LTD.”

The employer was ordered to restore 92.37 days of sick leave credits to R.A.

Reference: Ontario Power Generation and Power Workers’ Union, Canadian Union of Public Employees, Local 1000. Christopher J. Albertyn — Sole Arbitrator. Andrew K. Lokan for the Union. William J. Hayter for the Employer. Nov. 20, 2012. 21 pp. Full Decision Order No. LVI4047-1.