Take care when dismissing employees due to illness

A recent decision by the Federal Circuit Court is a reminder to employers of the need to be careful when considering dismissal of employees who have been absent from work due to illness for an extended period of time.

The Court has confirmed that even if an employee has been away from work due to illness or injury for an extended period of time and the employee’s dismissal is not prohibited under section 352 of the Fair Work Act 2009, the dismissal may still amount to unlawful adverse action or discrimination against the employee.

The case involved an employee who had been absent from work for a period of around 10 months as a result of stomach and liver cancer.  During this period, the employee maintained communication with his employer and in 2013 he informed his employer that he was looking to return to work.   The employer responded with a termination letter, stating that the employee’s extended period of absence left it no choice but to terminate his employment.  The employer said that it had made a number of large-scale changes in the workplace during the employee’s absence.

Generally, the Fair Work Act  protects employees from being dismissed because they have been temporarily absent from work due to illness or injury for a period of up to 3 months in any 12 month period.   However, if the employee has been absent from work for more than 3 months and is not on paid personal/carers leave for the duration of the absence, the employee does not receive this protection.  

The Court in this case made the express point that although a dismissal may be authorised due to the extended period of absence (ie the dismissal is not specifically unlawful under section 352 of the Fair Work Act), it may still constitute an unlawful dismissal under Commonwealth or State anti-discrimination legislation.   In cases where an employee is ill or injured, the employee may be entitled to protection from discrimination or adverse action on the ground of a disability.

In this case although the employee had been absent from work for 10 months, was on unpaid leave and was no longer protected from dismissal because of temporary absence due to illness he retained his rights to pursue a claim for unlawful adverse action on the grounds of disability discrimination.  The case was referred to mediation.

Whenever considering dismissals, particularly where an employee is ill, injured or has exercised workplace rights, employers should obtain proper legal advice and thoroughly consider the variety of protections available to employees under State and Commonwealth legislation before making a decision to terminate employment.