Can We Terminate an Employee Who Has Been Away on Prolonged Medical Leave?

How Long Are We Supposed to Keep Doing This?

When the employee went on a prolonged medical leave, the employer’s concern was whether everything would be all right. The employee had worked for the company for almost six years and occupied an important operational role in a small Alberta business. The first medical note said the employee would be unable to work for several weeks. Management rearranged the workload, told the employee to concentrate on getting better and assured the rest of the team that the disruption would be temporary.

People stepped in. One colleague took over the employee’s most urgent files. The manager absorbed some of the supervisory work. The team divided other responsibilities among themselves. It was not ideal, but people wanted to help.

Several weeks became several months. The employee remained in contact, but there was still no firm return date. Another medical note arrived. The employee continued to be medically unable to work and the doctor scheduled another reassessment in several months.

So the employer adjusted again. The company brought in a temporary worker, but that person could not perform all aspects of the role. The manager continued carrying some of the responsibilities. Another employee began working additional hours.

The arrangement was costing money, but the more significant problem was what was happening inside the business.

The employee covering part of the absent employee’s work was becoming exhausted. Deadlines were getting harder to manage. The manager was effectively doing two jobs. The temporary employee wanted to know whether the position might become permanent, and management could not provide an answer.

Still, nobody wanted to be unfair. The employee was sick. So the company kept going.

By the time the absence had stretched much further, the tone of management meetings had changed. The question was no longer simply how to redistribute the work until the employee returned.

Management wanted to know whether the employee was coming back at all and the employer recently requested updated medical information. The response confirmed that the employee remained unable to return to regular duties. There was no definite return date. The clinic expected to conduct another reassessment in several months.

For months, the business had tried to make the arrangement work. Nobody wanted to terminate someone because they were ill. But the operational consequences were becoming increasingly difficult to ignore.

Eventually, the owner asked the question that many employers in this situation are afraid even to say out loud: “How long are we legally required to keep this position open?”

Then came the question underneath it: “Can we ever terminate an employee who is still on medical leave?”

The answer is not simply yes or no. And it certainly is not, “Once the employee has been away for six months, you can terminate.”

The real legal question is what the employer has done during those months, what the medical evidence says now, whether the employee remains protected by a statutory leave, whether the absence relates to a disability protected by human rights legislation, whether reasonable accommodation remains possible and, ultimately, whether continuing the employment relationship has reached the point of undue hardship or, in an appropriate case, whether the employment contract has become frustrated.

That is where the legal analysis begins.

Prolonged Medical Leave and Disability Accommodation Are Not the Same Legal Question

One of the easiest mistakes for an employer to make is to treat the end of a statutory medical leave as though it automatically ends the employer’s legal obligations.

It does not necessarily work that way.

There are at least two legal frameworks an Alberta employer may need to consider. The first is Alberta’s employment standards legislation.

Effective January 1, 2026, an eligible Alberta employee who has worked for the same employer for at least 90 days can take up to 27 weeks of unpaid long-term illness and injury leave per calendar year. The leave is job-protected. Alberta’s current guidance states that employers must grant the leave to eligible employees and return them to the same or an equivalent position when they return, subject to the legislation. Employers cannot terminate or lay off employees while on job-protected leave except in the circumstances permitted by the legislation, such as suspension or discontinuance of the business.

But the statutory leave is only one part of the analysis.

Physical and mental disability are protected grounds under Alberta human rights law. An employer has a duty to accommodate disability to the point of undue hardship. The Alberta Human Rights Commission specifically cautions that an employer cannot simply discipline or terminate an employee because of a disability-related absence record.

That distinction matters enormously.

The fact that an employee has exhausted a statutory job-protected leave does not automatically mean that the employer can terminate the employee the next day.

Human rights obligations may continue beyond the statutory leave period. So the employer in our story cannot simply circle week 27 on the calendar and treat week 28 as permission to terminate.

The analysis is much more individual than that.

There Is No Automatic “Maximum Medical Leave” Rule

Employers understandably want certainty. As a medical absence stretches from weeks into months, the question naturally becomes how long the business is expected to keep the position open. At first, six months may have seemed like a long time. Then six months arrives and there is still no return date. The employer begins looking ahead. What if the absence reaches a year? What if another year passes after that? At what point does an arrangement that began as a temporary accommodation become something the business can no longer reasonably sustain?

It is tempting to believe that somewhere in the law there must be a number that answers the question. A point on the calendar after which the employer can say, we have waited long enough. But human rights law does not provide that kind of universal countdown.

The problem is that human rights law does not operate through a universal countdown. The duty to accommodate requires an individualized assessment. What creates undue hardship for a very small employer may not create undue hardship for a large organization with hundreds of employees and significant flexibility in its workforce.

The Alberta Human Rights Commission describes undue hardship as hardship that is substantial in nature. Relevant considerations can include intolerable financial cost, serious disruption to the business, the size and resources of the employer, the interchangeability of the workforce and facilities, and health and safety concerns. The employer bears the burden of demonstrating undue hardship when relying on it.

The duty to accommodate recognizes that accommodation may require something from the employer. There may be inconvenience. Other employees may have to adjust their routines for a time. The business may incur additional costs or have to operate in a way that is less efficient than it would prefer. Those difficulties do not necessarily mean that the duty to accommodate has reached its limit.

But as the months pass, those difficulties can begin to accumulate. The colleague who agreed to cover additional responsibilities temporarily may be struggling under the extra workload. Overtime costs may be increasing. Retaining a temporary replacement may be difficult when the employer cannot say whether the position will exist in six months. Clients may be experiencing delays, and the manager who initially absorbed part of the workload may no longer be able to continue doing two jobs.

At some point, the employer may reasonably begin to wonder whether what started as manageable disruption has become something the business can no longer sustain. That is where the question of undue hardship begins to matter. The difficulty, however, is that an employer cannot simply say, “This has become too much.” If the employer intends to rely on undue hardship, they must demonstrate the impact on the business with evidence.

The Employer Is Allowed to Ask Questions, But Not Every Question

This is another area where employers sometimes become unnecessarily cautious.

Respecting an employee’s medical privacy does not mean that the employer must remain completely in the dark.

An employer managing a prolonged medical absence may reasonably need medical information to understand whether the employee remains unable to work, the approximate duration of the absence, whether a return is anticipated, what functional restrictions or limitations exist and what accommodation might permit a return to work.

What the employer usually does not need is unrestricted access to the employee’s medical history.

The Alberta Human Rights Commission states that employers may request information confirming that an absence is for medical reasons, an approximate return-to-work date and information relevant to workplace operations and job duties. For accommodation and return-to-work planning, an employer may also need information about functional restrictions and limitations and their expected duration. Employees generally do not have to disclose a specific diagnosis except in limited circumstances. That distinction is important.

The employer’s question should usually not be: “Exactly what is wrong with you?”

It is more likely to be: “What do we need to know about your functional abilities, restrictions, prognosis and anticipated return so that we can understand whether and how you can return to work?”

For the employer in our story, another medical note simply saying “unable to work until further notice” may eventually be insufficient to answer the questions the business legitimately needs answered.

That does not give the employer permission to demand a complete medical file.

It may, however, justify a careful request for updated and more useful medical information.

Accommodation Is a Process, Not Just a Waiting Period

There is another danger in thinking about long-term disability solely in terms of how long the employee has been absent.

An employer could wait twelve months and still have done very little to accommodate.

Another employer might have spent those same twelve months communicating with the employee, obtaining appropriate medical information, modifying duties, exploring reduced hours, considering a graduated return to work and investigating other reasonable arrangements.

Those employers are not necessarily in the same legal position simply because the calendar shows the same number of months.

The accommodation process is supposed to be collaborative. Alberta’s Human Rights Commission states that employers and employees must act reasonably and cooperatively, and that accommodation may involve changes to rules, duties, schedules or workplace arrangements.

Depending on the medical information and the workplace, possibilities might include modified duties, altered hours, a graduated return, temporary redistribution of certain functions or another reasonable arrangement that allows the employee to perform productive work.

But accommodation also has limits.

An employer is not necessarily required to eliminate the essential purpose of the position or indefinitely maintain an arrangement that causes undue hardship.

That boundary is where these cases become difficult.

What Does “Undue Hardship” Actually Mean?

The Supreme Court of Canada’s decision in Hydro-Québec v. Syndicat des employé-e-s de techniques professionnelles et de bureau d’Hydro-Québec, 2008 SCC 43, remains important in understanding the limits of disability accommodation.

The employee in that case had experienced extensive disability-related absenteeism over a period of years. The Supreme Court rejected an approach that effectively required an employer to prove that accommodation was impossible.

The duty is accommodation to the point of undue hardship, not accommodation at any cost and forever.

The Court explained that where an illness prevents an employee from working for the reasonably foreseeable future despite the employer’s attempts to accommodate, or where the proper operation of the business is excessively hampered, the employer may reach the point at which its accommodation obligation has been satisfied.

That does not create a formula. Rather, it creates a question.

Looking at the medical evidence and the accommodation efforts at the time the employer is considering termination, is there a reasonable prospect that the employee can return and perform the essential obligations of the employment relationship, with reasonable accommodation?

That question is much more useful than asking how many months have passed.

The Size of the Employer Can Matter

Return to the small business in our story.

Suppose there are only eight employees.

The absent employee occupies a specialized role. For many months, another employee has been performing substantial additional work. The employer has tried temporary staffing, but qualified candidates are unwilling to accept an indefinite temporary position. Overtime costs are mounting. Service levels are beginning to suffer.

Those facts may matter.

Now imagine the same absence in an organization with 5,000 employees, multiple locations, substantial financial resources and several employees capable of performing the relevant functions.

The accommodation analysis may look very different. The Alberta Human Rights Commission expressly recognizes that size and resources, workforce interchangeability, serious business disruption and health and safety considerations may be relevant to undue hardship. It gives the example that a very small business may face accommodation constraints that a larger employer does not.

That is why an employer should be wary of copying another company’s answer.

“My friend’s business terminated someone after nine months” tells us almost nothing about whether your business can lawfully do the same.

What If the Employee Cannot Return to the Original Job?

This is often the point at which the conversation becomes more complicated.

Suppose the employee’s doctor eventually confirms that the employee can return to work, but can no longer perform a significant part of the original role.

The employer then needs to understand the employee’s restrictions and limitations and assess whether reasonable accommodation can permit the employee to perform productive work.

That does not necessarily mean the employer must return the employee to the identical arrangement that existed before the disability.

Nor does it automatically mean that the employer must invent an entirely new permanent job.

The analysis is fact-specific.

The central question remains whether reasonable accommodation can permit the employment relationship to continue without imposing undue hardship.

And importantly, the employee also has responsibilities in this process.

Employers do not perform accommodation entirely on an employee. Employees are generally expected to cooperate in the accommodation process, provide reasonably necessary information and participate in reasonable accommodation efforts.

A refusal to participate can therefore affect the analysis.

What About Frustration of the Employment Contract?

There is another concept that sometimes arises when a medical absence becomes exceptionally prolonged: frustration of contract.

Frustration and undue hardship are related to the practical reality of whether the employment relationship can continue, but they are not concepts employers should casually treat as interchangeable.

At common law, frustration can arise where circumstances beyond the parties’ control fundamentally alter the employment relationship so that continued performance of the contract is no longer reasonably possible.

In the disability context, the question can involve whether the employee’s incapacity has become sufficiently prolonged or permanent that there is no reasonable prospect of returning to the employment relationship contemplated by the parties within a reasonable time.

And this is an area where Alberta employers now have particularly timely guidance.

In Lai-Terke v. EFW Radiology, 2026 ABCJ 114, the Alberta Court of Justice considered an employee who had been away from her sonographer position for more than three years. Reporting on the decision indicates that the medical evidence eventually showed permanent restrictions that prevented her from performing the core ultrasound work that made up most of her position, even with modified work. The Court concluded that the employment contract had become frustrated. Bow River Law LLP

That decision is useful precisely because it demonstrates why employers should resist turning frustration into a calendar rule.

The conclusion did not arise merely because three years had passed.

The medical evidence, the employee’s ability to perform the essential work, the permanence of the restrictions and the accommodation analysis mattered.

Frustration is therefore not shorthand for: “This employee has been away too long.”

Employers should reach this legal conclusion carefully and on appropriate evidence.

Before Considering Termination, Ask These Questions

When a medical absence has become prolonged, an employer should stop thinking only about elapsed time and take a structured look at the file.

The important questions include:

• Is the employee currently on a statutory job-protected leave?
• Does the absence involve a disability protected under human rights legislation?
• What current medical information does the employer actually have?
• Is there an approximate return-to-work date or meaningful prognosis?
• What are the employee’s functional restrictions and limitations?
• Has the employer explored reasonable accommodation?
• Could modified duties, reduced hours or a graduated return reasonably work?
• Has the employee cooperated in the accommodation process?
• What operational or financial hardship has the employer actually experienced?
• Can that hardship be demonstrated with evidence rather than frustration or assumptions?
• Is there a reasonable prospect of the employee returning to productive employment within a reasonably foreseeable period?
• Is the employer considering undue hardship, frustration of contract, or another basis for ending employment, and does the evidence actually support that legal position?

This is also the point at which legal advice before termination can be considerably less expensive than legal advice after a human rights complaint or wrongful dismissal claim has begun.

What Employers Should Document During a Long Medical Leave

The file should tell the story of the accommodation process.

That does not mean recording an employee’s confidential medical information more broadly than necessary.

It means maintaining an appropriate record of communications, medical-information requests, restrictions and limitations relevant to the workplace, accommodation options considered, accommodations offered, the employee’s response, return-to-work discussions and the actual operational consequences of the absence.

It is important to note the following:

1. When the employer claims that continuing the accommodation has become financially unsustainable, they must include evidence of the cost.
2. In situations where the employer says the arrangement is seriously disrupting operations, they need evidence of the disruption.
3. Should temporary staffing fail, document what management tried.
4. Whenever other employees are working substantial overtime, record it.
5. If management considered a particular accommodation but it could not reasonably work, document why.

Undue hardship is not simply a feeling that the business has waited long enough.

It is a legal position the employer may have to prove.

What the Employer Should Not Do

There are several shortcuts that can create significant risk.

• Avoid automatically terminating an employee simply because they used the full 27 weeks of statutory illness and injury leave.
• Creating a company rule that everyone is terminated after a fixed number of months of medical absence is risky, as it ignores the human rights analysis.
• Never demand a diagnosis simply because management wants to know what is wrong.
• Employers must not stop communicating with the employee for months and then complain that nobody knows whether the employee will return.
• Refrain from assuming that inconvenience equals undue hardship.
• Most importantly, do not decide to terminate first and then begin building an accommodation file to justify a decision management has already made.

The chronology matters.

Back in the Management Meeting

The owner still has a business to run. The manager is still tired. The team is still carrying additional work. The temporary staffing arrangement is still imperfect.

Human rights law does not require the employer to pretend those realities do not exist but neither does the existence of those difficulties automatically answer the legal question.

So instead of asking only: “Has the employee been away long enough that we can terminate?”

the employer asks a different set of questions.

• What does the current medical evidence actually tell us?
• Is there a reasonable prospect of return?
• If the employee can return with restrictions, what accommodation is reasonably possible?
• What have we already tried?
• What has the absence actually cost or disrupted?
• Are we experiencing hardship, or has the hardship become undue?

And if the medical evidence indicates that the employee cannot return to the essential employment relationship within a reasonable foreseeable period, does the situation raise frustration of contract?

Those questions may ultimately lead to termination.

They may instead lead to updated medical information, a graduated return-to-work plan, modified duties or another accommodation.

The correct answer depends on the evidence.

That is why there is no date on the calendar that automatically tells an Alberta employer when compassion has lasted long enough and termination becomes lawful.

The law asks a more difficult question: Has this particular employer, dealing with this particular employee and this particular disability, reached the point at which reasonable accommodation can no longer continue without undue hardship?

That is the question that should be answered before the termination letter is written.

If This Sounds Like a Situation Your Business Is Managing

A prolonged medical absence can be difficult for everyone involved.

The employee may be dealing with a serious health problem and uncertainty about whether or when returning to work will be possible.

At the same time, the employer still has clients to serve, work to distribute, employees to support and a business to operate.

Those realities do not have to be treated as competing moral positions.

They are precisely why accommodation law requires an individualized process rather than an arbitrary deadline.

If your business has been carrying a prolonged medical absence and you are no longer sure what you are required to do next, reach out to our employment law services at KedgeAnchor Law before making the termination decision. We can review where the accommodation process stands, the medical information available, the steps already taken and the options that may now be available to the business.

Sometimes the next step is termination.

Sometimes it isn’t.

The important thing is knowing which situation you are in before you act.

This article provides general information about Alberta employment and human rights law and does not constitute legal advice. Medical leave, disability accommodation, undue hardship and frustration of contract are highly fact-specific. Employers should obtain advice about their particular circumstances before terminating an employee whose absence or limitations may relate to a disability.

Key Alberta resources: Alberta long-term illness and injury leave guidance and Alberta Human Rights Commission duty to accommodate guidance.