An Employment Relations Authority (ERA) member has ruled that Tautoko Mai Sexual Harm Support Services Trust was justified in dismissing a staff member who remained on sick leave for eight months without providing a medical diagnosis or a return-to-work date. Authority member English found the employer acted in good faith by offering mediation and multiple opportunities for engagement before terminating the contract.
Why the ERA ruled the dismissal was justified
The dismissal of the employee, Watkins, followed an extended period of absence that placed significant operational and financial strain on the trust. According to the ERA determination, Watkins stopped attending work on February 7, 2024, following an internal investigation into her conduct regarding an unplanned client trip. While the investigation cleared her of disciplinary wrongdoing in March 2024, she did not return to the workplace.
Member English noted that the trust had repeatedly requested information regarding her medical capacity. Despite providing certificates stating she was “medically incapacitated,” Watkins later provided evidence claiming she was not actually incapacitated. The ERA found the trust acted reasonably by attempting to facilitate a return to work through mediation and by adjusting reporting lines, which Watkins ultimately rejected.
Did you know? Employers are legally required to provide a safe workplace, but they are not obligated to hold a position open indefinitely when an employee fails to provide evidence of a medical prognosis or a clear timeline for returning to duty.
How medical incapacity claims impact employment law
The case highlights the threshold for medical incapacity as a grounds for termination. Under New Zealand employment law, an employer must prove they have provided the employee with a fair process, including opportunities to discuss their health and potential support. In this instance, the trust informed Watkins in July 2024 that it was considering termination due to the lack of communication regarding her return.
The trust stated it could no longer sustain the operational impact of the ongoing vacancy. English concluded that because the trust provided multiple opportunities for engagement and the employee remained absent without a clear diagnosis or return plan, the dismissal met the requirements of being a fair and reasonable process.
Case contrast: When is a dismissal considered “unjustified”?
Employment tribunals often contrast cases based on the level of consultation provided. In this matter, the authority contrasted the trust’s active attempt to facilitate mediation against the employee’s refusal to engage unless specific conditions—such as managers admitting to “collusion”—were met. Because the trust agreed to some requests, such as changing reporting lines, but refused to force managers to make statements they disagreed with, the authority determined the employer’s actions remained within the bounds of good faith.
Frequently Asked Questions
- Can an employer fire you while on sick leave? Yes, if the employment is frustrated by long-term medical incapacity and the employer has followed a fair process, including consultation and providing the employee a chance to present medical evidence.
- What is “good faith” in an employment investigation? It requires both the employer and employee to be communicative, transparent, and fair. In this case, the trust was found to have met this standard by attempting mediation.
- What happens if an employee refuses to return to work? If an employee refuses to return without a valid medical reason, the employer may initiate a process to end the employment relationship, provided they have warned the employee of the consequences.
Pro tip: Always maintain clear, written documentation during long-term leave. For both employers and employees, documenting every request for information and every response is essential if the situation moves to the Employment Relations Authority.
Have you navigated a complex employment dispute, or are you interested in learning more about workplace rights? Subscribe to our newsletter for the latest legal updates and analysis of recent ERA rulings.
