Employers are always looking for ways to boost attendance at work. One way that employers try to accomplish this goal is by offering incentive programs, such as bonuses, for meeting attendance thresholds.

What happens if an employee falls short of the attendance threshold because he or she is on some form of medical leave, such as short-term disability or workers’ compensation?  Must the employer pay the bonus?

The answer might be no – provided that the employer treats all similarly absent employees in the same way.

Attendance Bonus May Not Be Discriminatory

In Halltech Inc. v United Steelworkers of America Local 3-01, the employer gave a $500 bonus to employees who were never late or absent throughout the year (with some narrow exceptions).

The employee had perfect attendance with the exception of two days when he was absent and receiving Workplace Safety and Insurance Board (WSIB) benefits. The employee was denied the attendance bonus.

The employee’s union grieved the decision, and argued that denying the bonus was unfair and discriminatory, particularly because the employee was only absent due to a work-related injury. However, the arbitrator sided with the employer, and found that the denial was neither discriminatory nor unfair.

The arbitrator pointed to past rulings, in particular the Ontario Court of Appeal’s decision in  O.N.A v Orillia Sodiers Memorial Hospital  where an employer was allowed to deny compensation to disabled employees where the compensation was directly tied to doing work, or to being present in the workplace.

This denial does not breach the Ontario Human Rights Code  as long as every employee in the same situation – every employee who misses work, for example – is treated the same way, and is not discriminated against for reasons prohibited under the Code.

What Happens When the Employees are Not Treated Equally?

In Cameco Corp. v U.S.W.A, Local 13173,[1] an employer denied attendance bonuses to employees on maternity, parental, and short-term disability leaves, yet paid bonuses to employees who were temporarily laid off.  Both groups of employees missed work, yet only the second group received a bonus.

An arbitrator ruled that the employer’s actions amounted to discrimination against the first group, based on prohibited grounds under the Code (sex, family status and disability).  The employer, therefore, had to pay damages to the first group of employees.

Cameco Corp. demonstrates how an attendance bonus program can go offside.

In the Halltech Inc. case, the arbitrator noted that the employer equally denied the bonus to all employees who missed work.  Moreover, the employer had previously denied the bonus to another employee who had a WSIB-related absence, showing that its practices were consistently applied.  In contrast, in Cameco Corp., some employees who missed work received bonuses while others did not, and discrimination was found.

Conclusion

The decision in Halltech Inc. provides reassurance to employers that as long as an attendance bonus program is applied consistently to similar groups of employees, and does not violate any collective agreement, denying attendance bonuses to employees who miss work may not be discriminatory.

Nonetheless, employers must remember that statutory leaves are usually protected and should not be used as basis for withholding an attendance bonus.

Thank you to Joel Kom for his assistance in preparing this posting.

[1] (2007), 164 L.A.C.(4th) 155 (Surdykowski).