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Have you been dismissed on medical grounds? Your rights explained.

These days, some jobs are hard to find, and accordingly it becomes important to hold on to a job. As a Workers Compensation and Employment Lawyer, I regularly come across clients, who have had their employment terminated, on medical grounds, or more accurately an incapacity to work due to a medical condition. Loss of employment can create financial upheaval. What are your rights, if dismissed on medical grounds? What are the employer’s obligations?

Your rights may differ, depending on whether the incapacity is due to an illness or injury, which occurred at work, or whether it is due to an unrelated work illness or injury.

There are several pieces of important legislation, and various Court decision, that need to be considered, when your Employment Law lawyer advises you of your rights.

If your injury or illness is work-related, then it is likely, that you may have already submitted a WorkCover claim. The legislation routinely considered in the case of dismissal for incapacity due to such work-related injury or illness, is Fair Work Act (Cth) [FWA], Fair Work Regulations (Cth) [FWR], and the relevant WorkCover Legislation. WorkCover Legislation can be State based (i.e. Return to Work Act SA [RTWA]) or Commonwealth based (i.e. Comcare Legislation). In this article, I will assume the legislation is RTWSA.

If your injury or illness, is not work-related, then the legislation, routinely considered, is FWA, and FWR.

Let us look at each scenario, below:

Scenario 1 – Dismissal on grounds of incapacity due to a work-related illness or injury

  1. One of the fundamental principles of the Return to Work scheme, is to encourage recovery and return to work to the pre-injury employer, or if not practical, to another employer.

  2. Section 18 of RTWA, essentially provides that if a worker is incapacitated for work in consequence of a work injury, and is able to return to work, (on either a full-time or part-time basis), the employer, from whose employment the injury arose, must provide suitable employment for the worker, so far as reasonably practical, being the same as, or equivalent to the employment in which the worker was working, immediately before the incapacity. This is the primary obligation of the employer, subject to the exceptions referred to in the next paragraph.

  3. The exceptions to the above obligation, are: that it is not reasonably practical to provide employment in accordance with section 18 (the employer needs to prove this); or the worker left the employment of that employer before the commencement of the incapacity; or the worker terminated the employment after the commencement of the incapacity; or new or other employment options have been agreed between the worker, the employer and Return to Work Corporation; or finally, the worker has otherwise returned to work with the pre-injury employer or another employer.

  4. It is important to note, that if the employer terminates the worker’s employment, then that is not an exception to the employer’s obligation under section 18. This is therefore one reason that injured workers, should not resign their employment, without seeking legal advice.

  5. Whilst not a topic covered in today’s article, an injured worker can make Application under section 18, for the employer to provide suitable employment, subject to certain criteria, and the South Australian Employment Tribunal has the power to make an Order against the employer to provide such suitable employment. This will be covered in a further article.

  6. Under section 352 of FWA, an employer must not dismiss an employee because the employee is temporarily absent from work, because of illness or injury, of a kind prescribed by the regulations.

  7. Regulation 3.01 of FWR sets out parameters of what is a prescribed kind of illness or injury. In general, this includes situations where a medical certificate is provided within a certain time; or the employee complies with any obligations to notify the employer of an absence from work, and substantiates the reason for the absence; or relevant evidence has been provided for taking personal/carer’s leave.

  8. What is not covered as a prescribed kind of illness or injury in Regulation 3.01, is if, the employee's absence extends for more than 3 months; or the total absences of the employee, within a 12-month period, have been more than 3 months, and the employee is not on paid personal/carer’s leave for the duration of the absence.

  9. If, you are dismissed, then subject to some threshold requirements (relating to period of service, whether covered by Modern Award or Enterprise Agreement, not breaching the salary cap), then under FWA, you can make an Application for Unfair Dismissal, meaning the dismissal was harsh, unjust, or unreasonable. The Fair Work Commission (FWC) will have regard to a number of factors, including but not limited to: whether there was a valid reason for the dismissal related to the capacity; whether you are notified of that reason; whether you are given an opportunity to respond to any reason relating to the capacity; whether you were unreasonably refused by the employer, to allow a support person to be present; the size of the employers enterprise and how that is likely to impact upon dismissal procedures; the absence of dedicated HR management in the organisation, and the likely impact on the dismissal procedures followed; and finally, a catch all provision“any other matters that the FWC considers relevant”.

  10. It is common for the employer to state the reason for dismissal as “inability to perform the inherent requirements of the job”, or similar wording. When defining “the inherent requirements of the job”, this has been held to be the essential features of the job, without which the job would not be essentially the same. It is the requirements of the substantive position or role, not as it may be modified or restricted, in order to accommodate the employee’s injury.

  11. Many cases by the Commission and/or Full Bench, over the years have laid out some principles. These principles when applied, will likely determine whether the reason, was a valid reason.

  12. To be a valid reason, it needs to be sound, defensible and well-founded, and not capricious, fanciful, spiteful or prejudiced. This is considered in the context of the object of ensuring a “fair go all round”.

  13. If it is established, that a dismissal is prohibited by Workers Compensation legislation, or is otherwise unlawful, this fact is a relevant consideration in determining whether there was a valid reason for dismissal.

  14. The Courts consider whether the reason for dismissal, was properly founded upon medical opinions and importantly whether the employer could have made reasonable adjustments to the employee’s role, in order to accommodate any current or future incapacity. The issue of reasonable adjustments, requires consideration of the job or parts of the job that the worker may not have capacity for, the employers size, internal policies of the employer, environmental factors on the work site etc. As an example, if there was only one duty in the job, that the employee did not have the capacity to do, and that was a minor duty in the whole job, which could easily be catered for by another employee doing that duty, then there may be good grounds to argue that the employer had not made reasonable adjustments for the subject employee, if the employee had been dismissed.

  15. FWC has a power to order reinstatement and/or payment of compensation.

  16. Additionally, the dismissed worker can make an Application under section 18 of RTWA, to the employer to provide suitable employment, and thereafter an application to SAET, for an Order for an employer to do so, if the employer fails to provide such suitable employment.

Scenario 2 – Dismissal on grounds of incapacity due to a non, work-related illness or injury

In this scenario, the RTWA, does not apply, and the rights and obligations are set out in the above paragraphs 6 – 12 inclusive, 14, and 15.


The above article has not covered on another avenue of potential remedy under anti-discrimination legislation, which exist both at State and Federal levels. Discrimination due to disability can contravene such legislation.

As you have probably gleaned, this is a complex area of law, where multiple legislation, may be involved. Presenters at legal seminars, can spend hours, discussing the above topics.

If you have been dismissed on medical grounds, contact an employment lawyer here at LawCall, for a free no obligation consultation.

Written by
Graeme Kirkham
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