Ter­mi­nat­ing employ­ees on sick leave can be a recipe for disaster.

One of the biggest issues for an employ­er is deal­ing with under­per­form­ing staff mem­bers who abuse their sick leave enti­tle­ments or access their sick leave for a stress claim imme­di­ate­ly ensu­ing dis­ci­pli­nar­i­ly meeting.

Whilst an employ­er is not to be pre­vent­ed from ter­mi­nat­ing an employ­ee whilst on sick leave if the ter­mi­na­tion is attrib­uted to per­for­mance-based or oth­er law­ful rea­sons, it leaves the employ­er exposed to a claim. In the event that an employ­ee then lodges a gen­er­al pro­tec­tions (unlaw­ful ter­mi­na­tion) claim the onus will be on the employ­er to prove that the dis­missal was not asso­ci­at­ed with the employ­ee tak­ing sick leave (or oth­er unlaw­ful reasons).

What often hap­pens is that an employ­er sees an under­per­form­ing employ­ee and, whilst frus­trat­ed does not take dis­ci­pli­nary action against them because of chal­leng­ing demands of oper­at­ing the busi­ness. The employ­ee will then take their fourth instal­ment of sick leave at an incon­ve­nient time, which dri­ves the employ­er to dis­trac­tion feel­ing that they are being tak­en advan­tage of, they move rapid­ly (often too rapid­ly) to dis­miss them.

The case of Kavas­si­las v Migra­tion Train­ing Aus­tralia Pty Ltd [2012] FMCA 22, was a good exam­ple of this. Kavas­si­las (‘the appli­cant’) was dis­missed by her employ­er, Migra­tion Train­ing Aus­tralia (‘MTA’), after tak­ing two days of sick leave (which she was enti­tled to under her con­tract). The appli­cant informed MTA that she would pro­vide a med­ical cer­tifi­cate upon return­ing to work. How­ev­er before she returned to work, she received a let­ter from MTA ter­mi­nat­ing her employment.

The let­ter attrib­uted her dis­missal to sev­er­al per­for­mance based-rea­sons including:

  • Fail­ure to car­ry out her duties in a sat­is­fac­to­ry manner
  • Dis­rupt­ing the activ­i­ties of the com­pa­ny, result­ing in the loss of income
  • Harass­ment and bul­ly­ing of fel­low staff members
  • Fail­ure to dili­gent­ly and con­sis­tent­ly apply her­self to the dis­charge of her duties
  • Fail­ure to keep the direc­tors of the group of com­pa­nies aware of her absences from work

How­ev­er under cross-exam­i­na­tion, the evi­dence giv­en by MTA’s direc­tors was high­ly con­tra­dic­to­ry and did not jus­ti­fy any of the above rea­sons. MTA’s direc­tors also acknowl­edged that they had knowl­edge that the appli­cant was on sick leave and was going to pro­duce a med­ical cer­tifi­cate upon return.

Fed­er­al Mag­is­trate Smith was of the belief that the true rea­sons for ter­mi­na­tion were impul­sive and irra­tional” and that her dis­missal was trig­gered by her absence from work”.

FWA found that the ter­mi­na­tion of the appli­cant con­tra­vened s352 of the Fair Work Act, which pro­tects employ­ees from dis­missal whilst on sick leave because of ill­ness or injuries pre­scribed by the Fair Work Reg­u­la­tions.

It was also not­ed that MTA may have held an incor­rect view that an employ­ee can could be ter­mi­nat­ed whilst absent on sick leave at any time until a med­ical cer­tifi­cate was actu­al­ly submitted.

Although the reg­u­la­tions require that a med­ical cer­tifi­cate be pro­duced with­in 24 hours of the start of the leave, an employ­ee may take a longer peri­od of time pro­vid­ed it is rea­son­able in the cir­cum­stances”. This reaf­firms the intent of the Fair Work Act on pro­tect­ing employ­ees against dis­missal in rela­tion to an employ­ee’s exer­cise of rights to take sick leave.

What does this mean for employ­ers? It means that employ­ers must take extreme cau­tion when dis­miss­ing employ­ees who are cur­rent­ly tak­ing sick leave. If an employ­er is found to have con­tra­vened s352, they will be liable for the pay­ment of wages and compensation.

There is also a pre­sump­tion that if an employ­ee has been dis­missed whilst tak­ing sick leave, the dis­missal was under­tak­en due to the fact that the employ­ee was on sick leave. In dis­prov­ing this pre­sump­tion, employ­ers must have clear evi­dence show­ing that the dis­missal was not con­nect­ed to the employ­ee tak­ing leave, and that there was no unlaw­ful moti­va­tion for the dis­missal. The author­i­ties to this point high­light that prov­ing that some­one was not enti­tled to take sick leave verges on the impossible.

It is our view that dis­ci­pli­nary process­es should nev­er touch on issues of absen­teeism, as the law is weighed against so heav­i­ly against the employ­er on this issue there is often a con­nec­tion between absen­teeism and poor per­for­mance. We strong­ly rec­om­mend that employ­ers focus on the poor per­for­mance and make sure that all such dis­ci­pli­nary meet­ings are fol­lowed up by a warn­ing memo or letter.