How frustrating! – dealing with long term sickness absence

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Posted in:HR and Employment|May 29, 2014 | Join the mailing list

Where an employee’s ill health results in them being off work long term, this will undoubtedly be a major problem for the employee themselves. Even if their contract of employment provides for payment
of sick pay beyond the minimum statutory entitlement, that contractual sick pay will almost always be time limited and there will come a point where it runs out and the employee has to survive on whatever they are entitled to by way of state benefit. This,
together with the physical and/or mental hardships caused by the ill health itself, can place a huge burden on the employee and often he or she would dearly love to able to return to work rather than having to remain absent.

However, the problems caused by long term sickness absence are, of course, not limited to those suffered by the employee. Where an employee is absent from the workplace through long term ill health, this
will often be a major concern for their employer as well, as they struggle to deal with the issues caused by the fact that the employee is not there. The employer may need to take someone on to cover for the employee, but may then have the difficulty of not
knowing how long they will manage to keep that person in post, given the possible temporary nature of the job and the fact that the person providing cover may want a position with greater security for the longer term.

There’s also the fact that even where an absent employee has exhausted their entitlement to statutory and contractual sick pay, they may, under the Working Time Regulations, still be entitled to take
at least four weeks’ each year as fully paid holiday entitlement if they decide that they wish do so. Also, if they do not take their holiday entitlement in any holiday year, they will be entitled, again under the Working Time Regulations, to carry forward
at least some of it into the next holiday year, which can result in them then building up an entitlement to accrued holiday pay which then has to be paid out if their employment is eventually brought to an end.

Sometimes employers, faced with the problems arising from an employee being off work long term, have tried to argue that the employee’s absence has resulted in their employment coming to an end by reason
of the legal concept of frustration. This is where a contract ends without either the employer or the employee having to actually bring it to an end – it simply terminates by reason of it no longer being possible for the contract to be performed by the employee
because of their ill health.

If an employment contract ends by reason of frustration, then this will mean that although the employee’s employment has terminated, there has not been a dismissal and so there can be no claim of unfair
dismissal or claim that there has been a dismissal which amounts to disability discrimination.

However, employment tribunals are generally very reluctant to accept that an employment contract has ended by reason of frustration and employers who try to rely upon this argument risk a Tribunal finding
that the employment actually ended by way of dismissal.

The safer route for an employer to take when faced with possibly wanting to end the employment of someone who is on long term sickness absence is to accept that to end the employment relationship, they
will have to dismiss the employee and therefore they need to take all reasonable steps to ensure that that dismissal, if it happens, will not be unfair or discriminatory. The employer will need to ensure that before taking any decision as to whether or not
to dismiss, it has gathered as much evidence as it reasonably can regarding the employee’s current and likely future state of health and regarding what the employee can and cannot do in terms of work related activities. Usually this will involve the employer
obtaining (or at least trying to obtain) medical evidence regarding the employee’s health and prognosis, often from an occupational health specialist as well as from the employee’s own GP. The employer will also need to meet with the employee to discuss their
health and what they can and cannot do and the employer will have to look into whether there are reasonable alternatives available to dismissing the employee, such as moving him or her into another possibly less demanding role, where their health problems
would not be so much of a hindrance in terms of performing the duties of that role.

“It’s crucial for employers in these circumstances to tread very carefully when deciding whether or not to end the employment relationship”, says Nigel Crebbin of the Berg Employment Team, “as
getting it wrong can prove to be an extremely costly mistake to make.”

“While unfair dismissal compensation is capped at whichever is the lesser of one year’s pay and the statutory compensatory award limit (which is currently £76,574), there is no such cap when it comes
to successful claims of disability discrimination and awards in successful discrimination claims can therefore amount to very significant sums.”

For more information about any of the above or for practical commercial advice on this or any other aspect of employment law, please contact Nigel Crebbin of the
Berg Employment Team on 0161 833 9211 or email him at
nigelc@berg.co.uk.

Follow us on Twitter @Berg_HR

(The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Berg or
any of its partners or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.)

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