I handled the virtual paperwork for all leaves of absence at my last job, and there were multiple cases of medical leaves being extended indefinitely. There was something like several months to a year of extended absence before the company would even be allowed to consider firing, and other restrictions over handling medical LOA could make it almost impossible to get in contact with the employee to verify their recovery status.
Should a business be allowed to stop paying for medical coverage they promised to someone who in turn has a medical accident that puts them in a coma? Can the business legally or ethically assume they will never return or provide additional value to the company? Does your business give a shit about ethics?
You could view it as the employee gaming the system or taking advantage of a loophole, but the gray area definitely leaves more than just OP confused about what to do. In the longest case I remember, the reason they were able to stay employed for so long was nothing to do with how the employee was tolerated before leaving. From conversations, I got the impression that management would rather not have them return anyways
Lawyers: "Generating music using a machine learning model trained using real artists' music (without permission) does not violate those artists copyright!"
Therefore
Big Data: "Generating a black box replication of your identity trained on your private personal information and activity (without permission) does not violate your privacy!"