The ageing population is healthier than ever before. While healthier, those approaching their mid-60’s are not necessarily wealthier. In good health but with limited retirement savings, many of us will choose or be forced to continue to work beyond the age of 65. While delaying retirement and continuing to work beyond the traditional retirement age of 65 may increase our income for an extended period of time, doing so does not come without risk to our health and potentially, to our finances.
Issues arise at any age when our health interferes with our ability to work. However, after age 65 the consequences of becoming disabled from work can be far more significant. The reason being that most group Long-Term Disability (LTD) insurance plans end LTD coverage (as well as extended health coverages) once an employee reaches the age of 65. This leaves a void in income protection for many of us who work beyond age 65 and become disabled.
LTD Coverage Can Make All the Difference in the Event of Disability
LTD coverage is an important employment benefit provided by many employers. It aims to protect our incomes should we become disabled from our own occupation and/or from any occupation (depending on the terms of the specific insurance policy). Often the LTD benefit provides income in the range of 50% to 75% of our pre-disability earnings, should we not be able to perform the essential duties of our own/any occupation due to an illness or injury. Depending on our financial situation and stage of life, LTD benefits can be vital to supporting our family, retaining ownership of our home and other assets, obtaining various out-of-pocket medical treatments, preserving savings and even with respect to maintaining our mental health while battling a disabling condition.
The consequences of being ineligible for LTD coverage once reaching the age of 65 are no less significant. Often working at an advanced age is not an option but rather a requirement in order to maintain an adequate standard of living or meet other financial or personal obligations. Without LTD benefits, over the age of 65, we would have no option but to rely solely on employment pension earnings (if we are so fortunate to have a pension), Canada Pension Plan Retirement benefits and/or social assistance. These other options may provide only a nominal income and significantly less than employment income or income that would have been provided by LTD benefits under a group LTD policy. This resulting shortfall in income could have dire consequences if we were to become disabled over the age of 65 and we had been expecting to continue to work well into the future. How then has the law changed to protect older employees from income loss due to the termination of their LTD and other important health benefit coverages at age 65?
LTD Coverage for Employees Over 65 is Not Mandatory
In Canada, the Mandatory Retirement Age of 65 was dispensed with in 2006. This means that we may choose to continue to work beyond age 65 without fear of termination due to our age. It also means that we are no longer “forced” to retire at age 65. However, the provision of extended health care and disability benefits for employees aged 65 and older remained at the discretion of employers and not subject to the discrimination provisions in the Human Rights Code. This left employees over the age of 65 with little or no recourse to successfully dispute the age cap on their extended health and LTD insurance coverage–until relatively recently.
A Teacher’s Human Rights Win Offers Some Hope
In May 2018, the case of Talos v. Grand Erie District School Board resulted in a landmark interim decision by the Human Rights Tribunal. In this case, Wayne (Steve) Talos’ was working full-time as a secondary school teacher when his insurance coverages were terminated at age 65. Mr. Talos argued that he had suffered discrimination based on his age as his compensation had been reduced based solely on his age and not on his ability, performance or any other qualification. The Tribunal found that the provision in the Human Rights Code that allowed employers to terminate some benefit plans for workers 65 and over was unconstitutional.
Unfortunately, the decision only applied to health and life insurance benefits and not to LTD (nor to pension plans and superannuation funds). Although no new legislation has been introduced as a result of this case, some employers are now extending some benefit coverages to employees over 65 years old. Although this is an important step toward ensuring older employees are equally protected as they continue to work (particularly if they become sick or injured and require extended health benefits), it does not go far enough in addressing the issue of providing LTD coverage to older workers.
A Union Succeeds in Extending LTD Coverage for Older Members
While similar complaints under the Human Rights Code aimed to extend LTD coverage to persons over age 65 have proven unsuccessful, the altogether different approach taken in the recent case of Markham Stouffville Hospital v. CUPE Local 1999, resulted in a significant win for many older healthcare workers in Ontario. In this case, an Ontario union (CUPE Local 1999) succeeded in its efforts to extend LTD coverage by arguing that the wording of the Collective Agreement did not explicitly terminate a member’s coverage when the member turned age 65. Rather than arguing discrimination based on age, the union argued that the wording in the Benefit Booklet and not the actual Plan/Policy (which was found to not have been incorporated into the Collective Agreement) did not preclude older workers from LTD coverage.
In its decision, the Court stated that since the Mandatory Retirement Age legislation had been dispensed with, clear and unambiguous language is required in order to provide lesser benefits to employees who work after age 65 and there was no such language in this case. Based on the specific wording of the Collective Agreement and Benefit Booklet, not on Human Rights legislation, the Court found that members aged 65 years and older would not be ineligible for LTD coverage based on their age.
While this case turns on the specific wording of a Collective Agreement and Benefit Booklet, it does have far-reaching consequences. Over 50 hospitals in Ontario who have collective agreements with CUPE, numerous service-employee agreements and several agreements other institutions, will now be required to go to the substantial expense of purchasing additional LTD coverage for their members. The case may also provide a precedential basis and proven strategy for other unions (depending on the wording of their agreements) to successfully argue for extending LTD coverage to members over age 65.
Together, the Talos case and the Markham Stouffville Hospital case should provide hope to not only teachers and hospital workers but to all of us who will choose or be forced to work beyond our 65th birthdays. These cases have provided many employees in teaching and healthcare, across the province with benefits beyond age 65 and will likely serve to open a door to future Court and Human Rights challenges aimed to extend all benefits, including LTD, to all of us who are or expect to continue working beyond the age of 65.
Contact MK Disability Lawyers for Skilled Advice on Your Long-Term Disability Matter
If you are concerned about your LTD coverage beyond the age of 65 or are a teacher or healthcare worker facing the denial of an LTD claim, we can help. The skilled lawyers at MK Disability Lawyers have more than 50 years combined of experience dealing with disability cases. We would be happy to discuss your options with you and answer any questions you may have. To arrange a complimentary consultation with one of our experienced disability lawyers, please complete the online form, or call us at 844-697-4600.
The preceding is not intended to be legal advice. This blog is available for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog, you understand that there is no solicitor-client relationship between you and the blog publisher. The blog should not be used as a substitute for competent legal advice from a licensed lawyer in your jurisdiction. If your employment has been terminated because of your disability and you need legal advice, contact a lawyer specializing in disability law.