When and how can an employer terminate an employee due to a long-term absence? To avoid being on the receiving end of an unfair dismissal claim, employers must ensure that a proper assessment has been made of (i) the reason for termination and (ii) the procedure in deciding whether or not to dismiss.

Pursuant to the Employment Act 2000, a valid reason for termination is one connected with, inter alia, the ability, performance or conduct of the employee. A temporary absence due to sickness or injury is not a valid reason unless it is frequent and/or the employee exceeds their allocated leave entitlement. Further, it is not enough to show that there is a valid reason. The employer must also ensure that a proper investigation and termination procedure is followed.

Generally, a fair procedure involves consulting with the employee, establishing the employee’s medical position and considering reasonable accommodations or the availability of alternative employment. If the employee consents, a medical opinion should be obtained which will allow the employer to ascertain the nature of the employee’s illness, the likely length of absence, and whether the employee is suffering from a disability. The onus is on the employer to take reasonable steps to ascertain the employee’s medical position but the employer cannot compel an employee to share medical reports. If the employee refuses to cooperate then they risk decisions being made without the benefit of medical evidence.

If it is established that the employee is suffering from a disability, the employer is under a duty to make reasonable adjustments so that the employee may carry out his duties as well as a duty not to discriminate. If reasonable adjustments cannot be made then it may be necessary and acceptable to terminate the employee.

There are certain factors which are likely to be relevant in considering the reasonableness of the decision to dismiss. These include (i) prospects of the employee returning to work and the likelihood of the recurrence of
the illness; (ii) the impact of the absence on the employer’s business; and (iii) the employee’s length of service. Other factors may be relevant in deciding such reasonableness include: (a) the availability of temporary cover, (b) whether an employee has exhausted his sick and vacation pay, (c) the size of the organisation and (d) the administrative consequences of keeping the employee hired. It is best practice is to warn the employee that their termination is being considered and invite them to a meeting to discuss these issues and the medical evidence.

If it is determined that an employee will be terminated, the employer must ensure that proper notice is given to the employee. The relevant notice depends on the contract of employment, or if silent, would depend on the timing of the employee’s pay period with the maximum being one months’ notice. It should also be noted that a notice of termination may not be given to an employee who is on sick leave unless it has been at least four weeks.

Type

Insight

Locations

Bermuda

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