Source: https://www.grosman.com/blog/benefits/navigating-the-claim-for-lost-benefits/
Timestamp: 2019-04-26 16:06:03+00:00

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There is no doubt that a claim may be made for lost benefits for the notice period. The quantification of this claim is not, however, straightforward.
The first step is to recall that all benefits are deemed to continue for the minimum statutory notice period. This leads to the conclusion that benefits which are not replaceable such as life insurance and disability insurance remain in place for this time period. A claim for a death benefit may still be made for such a tragic event in this time period. Similarly a disability which has commenced in this period will lead to such a claim to the extent of the disability. These claims will be made against the insurer.
There are three possible ways of assessing the claim for lost benefits in this period. They are (1) basing the case on the employer’s premiums costs, (2) by using a percentage of base salary and (3) by determining the case on the replacement costs in the marketplace.
This valuation makes no sense as it falls far short of looking to the damage suffered by the employee. It is favoured by employers as it leads to a modest number. All this being said, it has been used from time to time in Ontario courts. These cases are stale dated but nonetheless they should be noted.
This claim is based on a percentage of base salary, usually in the range of 8% to 15%. It has been used on numerous occasions. This process is an expedient one. Often employers may present in promotional literature that the benefit plan is valued at a certain percentage to demonstrate the inherent value of the benefit package.
This theory would make more sense where the employee actually buys replacement benefits. This does not happen frequently. Certain benefits, such as long term disability, are often not privately replaceable. This method has been used.
The basic question to be asked is “what would have happened had the employment continued for the notice period” ? This could lead to a claim for the loss of a vested pension, or lost stock options, had the time period of notice produced such a result. One case awarded to a financial advisor the value of the sale of his book of business which would have followed in the notice period. A claim for the value of lost disability benefits to age 65 could also be paid, where the disability commenced in the common law period.
For this reason, the three alternatives presented above are each overly simplistic.
This issue, particularly with respect to the disability question, can lead to dramatic liability, often quite innocently. Legal advice prior to termination is very important.
Employees must be aware of the alternatives in the valuation process and how to present their claim, both in court and in settlement negotiations. They must also be aware that a release is a release, once the deal is done. A sudden medical trauma two days later will not only be uninsured but also leave the employee completely vulnerable.
 Life insurance is usually replaceable within a set period such as 30 days without the need for a new medical examination.
 Alpert v. Les Carreaux Ramca Ltée, 1992 CanLII 7748 (ONSC) at p. 16; and Orlando v. Essroc Canada Inc.,  O.J. No. 4056 (QL) (Gen. Div.) at para. 25.
 Mikelsteins v. Morrison, 2018 ONSC 6952 Camaganacan v. St. Joseph’s Printing Ltd., 2010 ONSC 5184 at para. 23; and Nemirovski v. Socast Inc., 2017 ONSC 5616 at para. 14.
 Ryshpan v. Burns Fry Ltd., 1995 CanLII 7278 (ONSC) at paras. 36-29; and Gutierrez v. Kohler Ltd., 2009 CanLII 593 (ONSC) at paras 17-19.

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