Dismissing An Employee On Sick Leave

It is a common misconception that employees that are on sick leave cannot be dismissed.


James Rowland

Commercial Director James leads Account Management, Sales and Marketing at Neathouse Partners.


11 September 2018


11 July 2024
6 min read
Dismissing An Employee On Sick Leave

Can You Dismiss An Employee On Sick Leave?

It is a common misconception that employees that are on sick leave cannot be dismissed.

Legally they remain an employee until they are dismissed, or they resign, so it is in an Employers best interest to take action as soon as possible.

Why Employees Need To Address Sickness Absence

Employees on sick leave continue to accrue holiday pay and have employment rights so it is crucial for an employer to address long-term sickness, as it can pose a significant cost to businesses. Employees very often cease keeping their employers informed of their absence (i.e. by sending fit notes) when they're entitled to Statutory Sick Pay (‘SSP’) so it is vital to a business to ensure that they have a robust Absence Notification Procedure that ensures that employees continue to keep you informed during their absence. It is prudent to ensure that your Absence Notification Policy enables you to make periodic contact with the employee while they are off sick.

Where possible, you should hold welfare meetings to discuss when your employee may potentially be able to return to work and to ascertain if there is any support that the company can give during their sickness absence. Your Sickness Policy should set out what employees are entitled to during their sick leave. If you do not pay full company sick pay (which you are not legally obliged to do), employees will be entitled to be paid SSP a period of up to 28 weeks (subject to qualification).If you fail to pay an employee SSP, you could face a Claim of Unlawful Deduction of Wages.

Can You Dismiss An Employee On Sick Leave?

An employer can dismiss an employee on sick leave on the grounds of ill health capability, but they must ensure that they not only follow a fair procedure but they also consider whether the employee’s medical condition is likely to fall within the definition of a disability as defined by the Equality Act 2010. Disability is not defined in the ordinary sense of the word, but is defined by the Equality Act 2010 which states that:

  • ‘A disability is a physical or mental impairment which has a substantial and long-term adverse effect on your ability to carry out normal day-to-day activities’.
  • ‘Substantial’ is described as something that is not ‘minor’ or ‘trivial’, and ‘long-term’ refers to a condition that has lasted or is likely to last for 12 months or more.

If an employee’s illness could fall within this definition, employers should exercise caution as the Equality Act 2010 also places a legal obligation on an employer to make reasonable adjustments.

What Is 'Long Term' Sickness?

There is no legal definition of what could be considered as long-term sickness, so realistically, it is a matter of common sense, and the size of business could also be taken into consideration. For example, it may be considered reasonable for a larger company to hold an employee’s position open for longer than it would be considered reasonable for a smaller business. As a general rule of thumb, anything longer than one month could be considered to be ‘long-term’ which would enable an employer to start capability proceedings with the employee.


The Process Of Dismissing An Employee On Grounds Of Sickness Absence

1) Make Sure You Have An Audit Trail

In the first instance, an employer should ensure that they have kept copies of all documentation, including fit notes and minutes of any meetings or correspondence with the employee. If it is looking increasingly unlikely that the employee will be returning to work in the foreseeable future, an employer can start to consider whether they may be able to terminate the employees’ employment on the grounds of ill health capability.

2) Get The Employees Consent

The first step would be to write to the employee and ask their consent to obtain a medical report from their G.P. and/or consultant. A consent form should be sent to the employee explaining their rights under the Access to Medical Reports Act 1988.It should be made clear to the employee that you are not seeking to view all of their medical records but rather, you want to ask their doctor about their current prognosis and the likelihood of returning to work.

3) You Will Need An Experts Opinion

When you have the consent form back, you should write to the doctor asking them specific questions about the employees’ diagnosis and prognosis, including:

  • Whether or not they are taking any medication;
  • How long they are likely to remain off work;
  • Whether the doctor considers their condition to fall within the definition of disability as defined in the Equality Act 2010;
  • Whether there are any reasonable adjustments that you can make as an employer that would enable the employee to return to work.

It is advisable to summarise for the doctor what the employee's job role entails so that they can advise better on whether or not the employee is capable in the short or long term to carry out that role. There may also be other specific questions that you need to ask. It is advisable to put as much detail in the letter and specify your questions clearly so that you obtain a report that will enable you to move to the next step of the process. Furthermore, it should be noted that doctors will charge for providing such reports and it can take some time for the reports to be returned so ideally, you want to get as much information as you can in the first report to avoid having to go back to the doctor to ask further questions. Once you have the report, you should have a better idea of whether you are going to be able, potentially to terminate the employee on sick leave on the grounds of ill health capability.

4) Capability Meeting

You should then invite the employee to attend a capability meeting, ensuring that they are provided with a copy of the medical report, giving them adequate notice of the meeting and advising them of their right to be accompanied by a trade union representative or work colleague. It is best practice when an employee is on sick leave to offer to hold the meeting at their home or a neutral location.

Often employees will also ask if they can be accompanied by a family member or friend. While there is no legal obligation for you to agree to this, it is best practice to consider the request, particularly given that the employee may not have had contact with work colleagues for some time if they have been absent from work.

At the meeting, you discuss the contents of the medical report with the employee and ask if they agree with the doctor’s view. If it is the doctors view that they will not be able to return to work in the foreseeable future, and the employee agrees, you may consider whether it would be reasonable to terminate their employment. If the employee has a potential disability, it is essential that you discuss thoroughly any possible reasonable adjustments that could be made; this may include, for example, a phased return to work, reducing their hours, or even doing an entirely different job. You do not have a legal obligation to create a role for the employee, but it is essential to ensure that you explore all possible options to protect yourself against a potential disability discrimination claim. You should ensure that you have someone with you who can take minutes of the meeting so that you have a clear record of what was discussed, again to protect your position if the employee subsequently makes a Claim.

5) Disability – Use The Legal Definition Over Your Opinion

It is also important to note that the definition of disability is a legal definition. So whether or not a condition is classed as a disability is ultimately a decision for an Employment Tribunal to decide and while a Tribunal will consider the doctors view as to whether the condition falls within the definition, they are not obliged to do so. If a doctor states the condition isn’t considered a disability, but you are uncertain, it is always best to err on the side of caution and treat the condition as a disability.


Absences As A Result Of Accidents At Work

Again, it is a common misconception that where an employee is absent from work as a result of an accident at work, which an employer may or may not be held liable for, they cannot be dismissed. In these circumstances, an employer can still consider terminating the employees’ employment where they have been absent for some time and are unlikely to return in the foreseeable future, as long as the requirements set out above are met. It is always advisable for employers to consult with their insurer who provides their Employers Liability Insurance in such cases, regardless of whether the employee has made a personal injury claim at that time. While most insurance companies will not object to the dismissal, if the employee loses their employment, it can impact on the number of damages that they can recover in a personal injury claim so your insurer should be notified before you dismiss to avoid any unnecessary complications with your cover.

Dismissing An Employee On Sick Leave - Take Away Notes

If you decide to terminate the employee’s employment, you must confirm your decision in writing, and you must give the employee notice. You should also give the employee the right to appeal against the decision.

If an employee has been absent from work for some time and it is unlikely that they will be able to return in the foreseeable future, as long as you have the medical evidence and a full and proper procedure to back up your decision, the dismissal should be considered fair.

It is important to note that an Employment Tribunal will also look at the size and resources of a company, so larger companies may be expected to hold jobs open for longer periods of time than smaller companies and likewise may be expected to go further when considering whether they can make reasonable adjustments.

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