Sick Employee NSW

An employee on long term sick leave can create considerable uncertainty for an employer.

  • Are they going to return to work?
  • Can I put someone else on to replace them?
  • If I replace them, what happens to the new employee once the sick employee returns to work?

These are just some of the issues employers struggle with.

This employment law article won’t get rid of those issues for you, but it may help you bring the issue to a head more quickly.

To place yourself in the best position to deal with this type of issue, as an employer, you need to have, at least, a basic understanding of what your restrictions and rights are.

Your key restrictions are:

  1. It’s unlawful to terminate an employee on a temporary absence from work due to illness.
    – A “temporary absence” from work essentially is an absence of greater than 3 months of paid “sick” leave. The 3 months can be either continuous or cumulative over a 12 month period.
  2. It’s unlawful to discriminate against an employee due to their disability.
    – An employee who is sick, at least temporarily, has a disability.
  3. It’s unlawful to terminate an employee due to their incapacity to work within 6 months of the employee receiving the incapacity, if the incapacity is caused by a work injury.
  4. In relation to any termination of employment, you will generally be required to forward the employee procedural fairness (or natural justice).

Your key rights are:

  1. The employee is required to provide you with reasonable evidence of the reason for the absence from work.
  2. If the absence is due to a work injury and subject of a workers compensation claim, the employee is required to provide you with medical certificates in accordance with the workers compensation legislation (for example, in NSW, WorkCover medical certificates).
  3. Notwithstanding the employee is on approved leave, the employee is still required to comply with your reasonable directions.
  4. Notwithstanding the employee is on approved leave, they are still required to comply with your behavioural and conduct standards during such leave.
  5. Generally, it will be a fundamental obligation of the employee, pursuant to his or her agreement with you, that he or she is fit to perform the inherent requirements of their position.

In my experience, employers whose decisions are guided by the rights and restrictions set out above are generally able to effect the termination of employment of a sick or injured employee’s employment, in a timely and efficient manner. The termination would generally be effective for one of the following reasons:

  1. due to misconduct of the employee by failing to follow the reasonable directions of their employer or to behave in accordance with their employer’s code of conduct; or
  2. due to the employee’s inability to perform the inherent requirements of his or her position.

Procedural fairness

Notwithstanding you may have a valid reason to terminate the employee’s employment due to the employee’s inability to perform the inherent requirements of his or her position, or due to the employee’s misconduct, you still need to ensure that you comply with the requirements of procedural fairness in the processes leading up to, and effecting, the termination.


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