Introduction
The key question is can we terminate an employee on a long sick leave?
The quick answer to this question is yes. However, such termination would amount to an unfair dismissal if it was done without careful consideration. There must be a balance between the need of the employer for work to be completed and the essential recovery period required by an employee.
This article will explain the legal right of an employer and the practical steps to terminate the employment of an employee for long ill absenteeism.
Doctrine of Frustration
An employer has the right to terminate an employee who is on a long absence due to ill health as the employment contract is frustrated. An employment contract is frustrated when the employee is unable to fulfill the work or tasks assigned to them by the employer due to their medical condition.
The concept under the Doctrine of Frustration is that, without the fault of either party, a supervening event occurs that was not reasonably foreseeable at the time the contract was made and this renders further performance of the contract either totally impossible or something radically different from what the parties bargained for, then the contract is forthwith discharged by operation of law.
In simple terms, a contract is frustrated when the performance or execution of the contract is impossible due to an event that occurred without the fault or default of any party.
The Employer must consult the Employee to ascertain the medical condition.
Although an employee has the legal right under the doctrine of frustration to terminate the employment contract, the employer cannot unilaterally terminate the employee on the grounds of excessive absenteeism. The employer must take reasonable steps to consult with the employee to ascertain their medical condition, including the nature of the illness, the possibility of recovery, and the expected period for recovery.
The employer must ensure that they are adequately and accurately informed about the medical condition, and they must make sure that the decision to dismiss the employee is made based on this information.
Only after confirming the medical condition can the employer fairly decide whether it is justified to terminate the employment of the employee. In doing so, they must consider the employee's medical condition along with other relevant factors, such as the length of absence and the urgency of the assigned work/task.
Bear in mind that the employer cannot solely rely on the Medical Board to ascertain the employee's medical condition. The employer must also approach the employee and consider any evidence that may be favorable to the employee. Therefore, before acting on the medical opinion, the employer must also properly listen to the employee.
Case Analysis
The principle above is incorporated in the case of MHS Aviation Sdn. Bhd. v. Zainol Akmar Mohd Noor
Briefly on the facts of the case, the Company terminated the Claimant's services as a helicopter pilot on the ground that he is diagnosed with "acute inferior and posterior myocardial infarction”. Due to his health condition, he was on medical leave and no flying duties for six to nine months and reassessment of his flying status after this said period.
The Company’s reason for his termination was centered around Dr. Dalbir's Report that the diagnosis is a serious medical condition and likely to be permanent. The company admitted they made no inquiries, merely issued the termination notice based on Dr. Dalbir's certification, assuming that it was of a permanent nature. The company did nothing more, stating that the claimant should have come back to them.
The Court held that the Company had unfairly dismissed the claimant without just cause on the ground that the Company had not weighed or assessed the situation properly between the conflicting needs of its business and the needs of the employee, more specifically the employer's need for the work to be done and the employee's need for time in which to recover his health.
The Court further held that the Company failed to show understanding of the situation or predicament the claimant was in, and sought no consultation with him but unilaterally and capriciously issued the termination notice with a preconceived or predetermined mind that his medical incapacity was likely to be permanent, which, if that had been so, the medical board would certainly have medically boarded him out.
Henceforth, it can be derived that it is important that an employer consults the employee and ascertain the medical condition so that they can fairly weigh between the employer's need for the work to be done and the employee's need for time in which to recover his health.
The employer must take into account any alternatives jobs scope.
The employer must also consider whether the employee can be retained through alternate employment, be it by way of a change of job scope or transfer to another department. The employer is expected to act reasonably in accordance with its obligations of social consciousness and should attempt to offer alternative employment to the employee, even if it might be a lower paying job.
However, there is no requirement for the employer to create a new job to assist the employee. The Guideline is laid down in 'Unfair Dismissal Case' by John McGlyne, 1976 Edition, and on page 90 it reads as follows:
(ii) Sickness and unfair dismissal
“If an employee is incapacitated by ill health and is no longer able to perform the job for which he was employed, his employer should consider whether or not the employee could be kept in employment in another capacity. If there is an existing job, even if it is paid lower, the employer should offer the alternative employment to the employee. If the employee refuses any such offers, then it seems reasonable for the employer to dismiss the employee. It should be noted that the employer is only required to consider the employee's ability to perform existing jobs - there is no duty on the employer to create a new job or modify an existing one, in order to continue the employment.”
Case Analysis
The above is portrayed in the case of Dapat Hotel Sdn. Bhd. (holiday Inn, Johore Baru) v. D Kesatuan Kebangsaan Pekerja-pekerja Hotel,bar & Restoran.
Briefly on the facts of the case, the Claimant was an Assistant Headwaiter at $350.00 per month with 4 points. However, the Claimant was later diagnosed with bronchial asthma, and it was discovered that the Claimant has an allergic skin condition affecting his forearm which is recurrent and can be attributed to an inherent atopy.
The Company offered him alternative appointment as a Doorman with a salary of $180.00 plus 2 points which is deemed suitable for him as he is exposed to fresh air, away from smoke, and good for his health. However, the Claimant rejected the offer.
The Industrial Court in this case quoted with approval ‘Unfair Dismissal Case' by John McGlyne, 1976 Edition and dismissed the Claimant’s claim for unfair dismissal.
Recommendation
In light of the above, an employer is recommended to follow the practical steps below:
Implement a medical board out policy or guideline.
It is important to have a Company policy or guideline to clearly provide for internal mechanisms where employees fall critically ill. This gives clarity to both employer and employees in such an unfortunate event occurs.
Discussion between the employer and employee.
It is the responsibility of the employer to take the first step and approach the employee in understanding the medical condition of the said employee as to the seriousness of the illness, the prospect of recovery and the estimated period of recovery. The employer cannot simply rely on medical opinion and must gather such information from the Claimant himself.
Offer alternative employment.
It is expected from the employer to offer alternate employment to the employee although it may involve different job scopes or lesser payment. Nevertheless, it is not expected from the employer to create a specific job merely to cater to the needs of the employee.
Conclusion
The employer indeed can terminate an employee on the ground of ill absenteeism given that the employer must fairly weigh between the employer's need for the work to be completed and the employee's need to recover their health.
This has often led to a moral debate. It would be unfair to terminate an employee and disregard his possibility for recovery. On the other hand, it would also be detrimental to the employer and its business if they must wait indefinitely for a potential recovery.
Therefore, it is recommended for employers to take practical steps to ensure a fair dismissal process that protects the interests of both parties.