Warning on terminating injured or sick employees


Terminating an injured or sick worker is a complex area for employers and HR professionals, with overlapping legislation offering various protections for employees.  

The MPGA warns that you exercise caution and obtain advice before terminating any employee to ensure the dismissal is not unfair or unlawful.  

Under the Fair Work Act, an employee who takes a period of sick leave that is paid the whole time is protected from dismissal regardless of how long they are on leave.

This means that the employee is protected by the general protections provisions of the Fair Work Act, and harsh penalties will apply to the employer and an individual if they terminate an employee for this reason.  

What happens when an employee has exhausted their sick leave entitlements and is absent for a further three months?

The protection for an employee does not apply if the employee's absence on unpaid personal or carer's leave extends for more than three months, or total absences of three months within a 12-month period.

However, employees still have protections under unfair dismissal legislation, workers compensation laws, anti-discrimination laws and disability discrimination laws.

Therefore, employers must still follow the appropriate rules for carrying out a dismissal and employees may challenge the termination of their employment by:

  • Making an unfair dismissal application if the reason for the dismissal is harsh, unjust or unreasonable; or
  • Making a general protections claim if the reason for the dismissal is another protected reason, or
  • Making a claim under a state or federal anti-discrimination law.

General Protections penalties

Employees who have been terminated due to a workplace right (such as accessing or attempting to access leave while they are ill or injured) can lodge a General Protections application with Fair Work Australia.  The Fair Work Ombudsman can also investigate allegations of contraventions of general protections provisions and initiate legal action for penalties.

Penalties for terminating an employee who is absent due to illness or injury are up to $12,600 for an individual and $63,000 for a corporation.

HR professionals can also be held liable as an accessory if they are involved or knowingly concerned in a breach of any civil penalty provision of the Fair Work Act.

Employers and HR professionals should always be careful when considering the termination of an employee who has been absent due to sick leave and members are encouraged to seek advice from the MPGA before terminating an employee for any reason.

For further assistance please contact Rebecca Cutler – Industrial Relations Manager on 9471 6670.

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