The short answer; yes, but in very limited circumstances.

The law attempts to strike a balance between appropriate protections for employees being dismissed when they are temporarily unable to work and for employers to have the ability to dismiss an employee who can no longer perform their job.

For example, one of these very limited circumstances could be where an employee;

  1. whose absence from the work place has totalled more than 3 months in the previous 12 months; and
  2. who is not on paid personal (sick)/carer’s leave; and
  3. has been receiving worker’s compensation payments.

In this instance the employee can be terminated, after 12 months from the date of injury.

However, employees have a number of protections under the law from being dismissed where they are on sick leave, so employers need to exercise great caution and seek legal advice before taking any action.

Even where an employer may be able to terminate an employee, they’re still required to follow procedural fairness requirements.

Protections for Employees

An employee may take paid personal leave if the leave is taken because the employee is not fit for work as a consequence of a personal illness, or personal injury.

An employer must not dismiss an employee because the employee is temporarily absent from work because of illness or injury for which they can provide a medical certificate.

However, if an employee’s absence extends for more than 3 months, or totals more than 3 months in the previous 12-month period, and the employee was not on paid personal leave, they are not protected.

Of note, paid personal leave does not include a period when the employee is absent from work while receiving workers’ compensation payments.

Finally, within 12 months after a worker sustains an injury, an employer must not dismiss the worker solely or mainly because the worker is not fit for employment in a position because of the injury.

Valid Reason – Capacity

A key consideration for the Fair Work Commission in assessing whether a dismissal was harsh, unjust or unreasonable is whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees).

Capacity is the employee’s ability to do the job as required by the employer.  Capacity also includes the employee’s ability to do the work they were employed to do.

Inability to perform the inherent requirements of the position may be a valid reason for the termination of an employee. The issue of capacity to perform the inherent requirements is assessed on the substantive position or role of the employee and not “some modified, restricted duties or temporary alternative position”.

Unfair Dismissal Requirements

Notwithstanding the fact that, legally, the employer’s position may be correct, dismissals of this nature will almost always be challenged by a employee making an unfair dismissal claim. In consideration of this, an employer should prepare themselves to be as defensible as possible.

It is important to observe the relevant procedural fairness elements that the Fair Work Commission would consider in deciding whether a dismissal was unfair:

  1. whether the person was notified of that reason in advance; and
  2. whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
  3. any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
  4. the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
  5. the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
  6. any other matters that the FWC considers relevant.


If there is conflict in the medical evidence the law was that the employer was to weigh up the evidence and make an informed decision. However, in recent cases, it is now the position that the ultimate decision would be in the hands of the Fair Work Commission or Court. A Court’s investigation would usually involve the opinion of 2-3 medical experts, which may be required if the employee presents conflicting medical evidence.

If you require any assistance in managing your employees, call our office today on 07 5444 1022 to book an appointment.





Harry McDonald

 Harry McDonald is a solicitor admitted to practice in the Supreme Court of Queensland, practising in the Commercial and Property Law team at Greenhalgh Pickard Solicitors. Within commercial law, Harry has a keen interest in employment law and enjoys assisting commercial clients in all areas of their employment & industrial relations with experience in employment contracts, sub-contractor agreements, restraint clauses, unfair dismissals, general protections, workplace policies and guidelines and general HR advice.

 The material contained in this publication is of a general nature only and is based on the law as of the date of publication. It is not, nor is intended to be legal advice. If you wish to take any action based on the content of this publication we recommend that you seek professional advice.