Poor you Laura. I have walked in your shoes on this one. A number of years ago I was denied a very lucrative position, one that I had been dying for, when the management discovered that I had issues.
Of course it is obvious that once they hear the word "bipolar" it sounds off alarm buttons in their heads. You are carrying enough of a burden dealing with this illness, without the job stressing you further by placing you on leave, and failing to at least give you a chance to prove yourself.
As a dues-paying member of a union, my advice to you is to stand your ground, and fight this one aggressively. That's what the union is supposed to be there for. But, having been a member of a union myself when the dirty was done on me, I am a bit cynical on that score as well.
The other consideration, which is one that my husband raised, is that on the other hand do you want to work in an environment whereby they make life unpleasant for you in order to get you out? So you have some tough decisions here.