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Medical grounds for terminating employment – what is the process? (Law)

The Wānaka App

Aspiring Law

24 February 2019, 4:42 PM

Medical grounds for terminating employment – what is the process? (Law)

When your employee becomes ill, or has an injury, with long-term effects, it takes not only a toll on them of course, but also on you as their employer as there is sometimes quite a disruption to your business.


How long must you wait for your employee to return to work? Answering this question is not straightforward. Every situation will have its own unique circumstances that will influence timeframes around your staff member returning to work.

If your staff member is unlikely to return within what you consider to be a reasonable time, or is taking long periods of leave for similar reasons, you may be considering terminating their employment. Before making this decision, it’s essential that you undertake a fair and reasonable enquiry – both from a legal standpoint and also to simply be a fair and reasonable employer.


The first step in this enquiry process is to write to your staff member:

  • Explaining your reasons for the enquiry
  • Explaining the possible outcomes, such as reduced duties or termination
  • Asking for relevant medical information
  • Offering an independent assessment by another medical professional, and
  • Providing an opportunity for your employee to respond


Once you have the above information, you should liaise with your employee to establish whether they can return to work full-time or on reduced, light or alternative duties. If, after hearing their response, you believe there is no suitable alternative to termination, you need to provide appropriate termination notice to them.


Your employment agreements should address the entire process from the first sick day to the notice of termination. If they don’t, or if you are unsure, we recommend you talk with us before making any move to talk with your employee.

Please remember, this information is designed as a general guide, and should not replace specific legal advice on a particular issue.


© NZ LAW Limited, 2019. Aspiring Law is proud to be a member of NZ LAW Limited, an association of 55 law practices working together to proactively share ideas and expertise for the benefit of our clients.