Long-term absence and staffing pressures lead to valid dismissal despite medical claim
The Employment Relations Authority (ERA) recently dealt with whether a charitable trust was justified in dismissing a community support worker due to medical incapacity. The worker had been on extended sick leave following a workplace incident that led to trauma.
Through her union, the worker filed a personal grievance claiming unjustifiable dismissal. She argued that delays in specialist appointments and Accident Compensation Corporation (ACC) assessments were outside her control, and that she was actively working to provide the required medical information for a return-to-work plan.
Her case highlighted the challenges of managing extended medical leave, as her ACC claim for Post-Traumatic Stress Disorder (PTSD) was approved shortly before the termination decision.
The worker was employed by a charitable trust that provided care services for vulnerable clients in Oamaru. Her role involved supporting residents with physical and intellectual disabilities to live independently.
On 14 January 2021, she experienced a serious threat from a resident that required police intervention. While she worked briefly afterward and took some pre-arranged leave, she began sick leave on 5 February 2021.
The trust's workforce development manager communicated regularly about staffing challenges, as finding temporary skilled workers in Oamaru proved difficult. This meant existing staff had to cover additional shifts.
From March through July 2021, extensive correspondence occurred between the parties. The charitable trust's general manager wrote in March:
"[The employer] was finding it increasingly difficult to fill [the worker's] shifts... [The employer] needed some certainty about [the worker's] return to full duties in the near future."
By July 2021, after multiple extensions, the trust's lawyers stated: "The fact is that not having someone in [the worker's] position for such a long period of time has put significant stress on our other staff who have needed to cover [their] duties. We are concerned that they are at risk, and have been at risk for some time, and this exposes our clients to risk."
The worker received ACC approval for PTSD on 19 July 2021. The trust issued a dismissal notice on 28 July 2021, citing the six-month absence, pressure on staff, and ongoing uncertainty about a return date.
The ERA examined whether the dismissal met the requirements of the Employment Relations Act 2000, particularly sections 4(1A) and 103A(3).
The Authority found the trust's actions justified: "[The employer] acted as a fair and reasonable employer could in giving [the worker] the time it did to firstly recover and when that was clearly not feasible in a reasonable time frame, then to provide a prognosis on recovery and return to work."
The Authority concluded that the trust had properly weighed competing interests: "[The employer] has properly assessed its business need against [the worker's] needs and the known likely progression of a return to work."
The Authority noted that the worker "continued to suffer from PTSD and this impacted such that she remained eligible for ACC earnings related compensation until she reached the age of retirement."
The parties were encouraged to resolve any costs between themselves, with the Authority suggesting that costs should potentially lie where they fell, given the circumstances of the worker's injury at work and the nature of the dismissal.