|
Identifying and managing disability fraud |
|
|
|
|
|
Written by By Malcolm MacKillop and Laurie Jessome
|
New considerations after Keays v. Honda
 As human resources professionals, you know that managing and minimizing absenteeism has always been a priority for employers. One of the most complex challenges to minimizing absenteeism is employee disability fraud. Disability fraud refers to a situation where an employee falsely claims a workplace injury or disability. It can also refer to a scenario where an employee initially suffers a genuine injury or illness but then malingers, refusing appropriate treatment and staying out of the workplace for longer than is necessary.
 Managing absenteeism due to disability is a tricky proposition. Many managers freeze when confronted with anything other than a very straightforward disability issue. There are good reasons to be wary. Courts and human rights commissions in Canada are very hard on employers who put undue pressure on sick employees to return to the workplace. Keays v. Honda is a particularly well-known example of an employer paying a high price for falsely accusing an employee of malingering, but there are many other court decisions in which an employer has suffered serious consequences for mismanaging a disability issue. So what can you do if you suspect that your employee has filed a false claim?
1. Seek legal advice. If it is an alleged workplace injury that you’re dealing with, then consult a lawyer who specializes in workers’ compensation cases and find out what documentation needs to be filed with the provincial workers’ compensation board or agency and how to file your objection. If the alleged disability arises from a non-workplace injury, then your focus will be on determining whether a fraudulent claim can be proven.
2. Conduct a proper investigation. So how should you proceed? In a word: cautiously. Avoid making a quick decision or jumping to conclusions. You must do a proper investigation. Although filing a false claim for sick pay or disability benefits is akin to theft or dishonesty, dismissing an employee who has a bona fide disability can result in serious legal liability. It is essential that you are in a position to justify any such termination with objective proof of fraud.
3. Review company policies. Always review the provisions of your company’s policy or practice manual on handling disability claims. If your company allows employees to leave work without any confirmation of illness or to reenter the workplace without adequate medical documentation confirming the illness, you have established a precedent that employees are not necessarily required to support sick days with medical notes. This will make it much more difficult for you to argue that your employee’s failure to adequately support his time off for illness is just cause for dismissal.
Your company should have a clear policy with respect to leaving the workplace, calling in sick, and returning to work after an illness. Requesting satisfactory medical evidence is always a good idea. The medical evidence should confirm the date the employee was seen by the doctor, the employee’s prognosis, and the time required for recovery. Having your employee sign a prior written authorization to allow you to communicate directly with his doctor is also helpful. In addition to having a clear policy in place, your company should also have a system for tracking employee absenteeism. A pattern of absenteeism can often provide evidence of a false claim.
4. Keep communicating. While an employee is off work due to disability, keep the lines of communication open. The level of communication that is appropriate may vary depending on the nature of the illness. Advise the employee that the company cares about him and wants to be kept updated about his prognosis. You should also be clear that it is important to you that employees attend regularly at work unless they are unable to do so due to sickness or other urgent situations. It is advisable to document all of your conversations with the employee regarding his absence. If there are issues regarding the employee’s credibility or inconsistencies in his claims, these notes will be very useful.
5. Use surveillance very cautiously. Surveillance is an extraordinary measure and should be used sparingly. Even though the employee would only be monitored while he is out in public, surveillance is likely to be viewed by the courts as an intrusive action. Therefore, you should always be prepared to demonstrate that you had reasonable suspicion of fraud before ordering surveillance. Surveillance is also problematic because it can invite employers and managers to substitute their own judgment for that of the employee’s doctor. If you see an allegedly disabled employee engage in what looks like heavy lifting, you may be tempted to assume that he is lying about his back problem. In reality, you may have very little information about his limitations or even the object he is moving (not all large objects are heavy). Consider having a physician review any surveillance before forming an opinion about whether or not the activities recorded are inconsistent with the employee’s alleged disability.
Before any decision is made, you must provide the employee with an opportunity to respond to your suspicions. This should be in the form of a face-to-face meeting and you must notify the employee of any facts you are relying on to support your allegations. Be prepared to postpone termination or take it off the table entirely if you receive a reasonable explanation or even an expression of remorse. You should always consider possible mitigating factors such as the employee’s length of service, absenteeism record, position with the company, or family circumstances. Occasionally, mental health issues may be in play. Feigning disability or failing to justify absence from work could be a manifestation of depression or serious issues in the employee’s home. Employers should be careful not to terminate employment when the employee is in an exceptionally vulnerable situation.
If you do decide to proceed with termination, the termination should be for just cause. To minimize risk, you may wish to consider providing a "without prejudice" payment in exchange for the employee executing a release in favour of your company. The release should contain an express acknowledgement by the employee that there has been no violation of his statutory rights.
Disability fraud is uncommon. However, since it can be very expensive it is important to incorporate fraud detection strategies into your disability management practices. The key is to approach potential disability fraud cases with caution and careful attention to detail. By properly managing this challenge, you can avoid the costly consequences of wrongfully terminating an employee who suffers from a legitimate disability.
Malcolm MacKillop is a partner with the firm Hodgson Shields DesBrisay O’Donnell MacKillop Squire LLP of Toronto. He can be reached at
This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
. Laurie Jessome is a lawyer with the firm Hodgson Shields DesBrisay O’Donnell MacKillop Squire LLP of Toronto. She can be reached at ljessome@ hodgsonshields.ca.
|
