When is incapacity a valid reason for dismissal?

The guidance note explores critical legal principles regarding dismissal based on employee incapacity, a valid reason recognised under the Fair Work Act 2009 (Cth). Employers must navigate complex considerations including the inherent requirements of the role, procedural fairness, and overlapping protections under discrimination and workers’ compensation laws. This document equips practitioners with essential insights into the interplay between medical evidence, reasonable adjustments, and legal thresholds for lawful termination.

Topics Covered

• Managing employee underperformance at work
• Was the dismissal procedurally fair?
• What are the legal risks involved in managing employee injury/illness?
• Discrimination and harassment
• General protections

Essential Insights

• Assess the employee’s ability to meet inherent job requirements beyond temporary or modified duties.
• Evaluate conflicting medical evidence critically to determine actual incapacity at dismissal time.
• Understand the employer’s duty to consider reasonable adjustments under anti-discrimination laws.
• Recognise key legal thresholds, including absence duration and leave entitlements affecting dismissal validity.
• Ensure procedural fairness with adequate warnings and compliance with performance management protocols.
• Consider overlapping protections from unfair dismissal, general protections, and workers’ compensation legislation.