You can be dismissed while on sick leave in Australia — but your employer must have a valid reason unrelated to the illness itself. Being on personal leave does not grant you immunity from redundancy, restructure, or performance-based termination. However, dismissal that is genuinely because of your illness or absence may be unlawful.

Key Takeaways

  • Dismissal because of temporary illness or injury is not automatically unlawful — the key question is whether you are still able to perform the inherent requirements of your role.
  • Dismissal because of permanent disability may be unlawful discrimination under the Disability Discrimination Act 1992.
  • Dismissal for exercising a workplace right — such as taking paid personal leave — is a general protections breach under the Fair Work Act.
  • Your employer must follow a fair process before dismissing you, including consulting, considering adjustments, and giving you an opportunity to respond.
  • The Fair Work Commission can order reinstatement or compensation if the dismissal was unfair or unlawful.

When Is Dismissal While on Sick Leave Lawful?

Dismissal while on sick leave may be lawful in these scenarios:

  • Redundancy — your role is genuinely eliminated, and you happen to be on sick leave at the time
  • Performance issues — pre-existing performance concerns unrelated to your illness
  • Incapacity — you cannot perform the inherent requirements of your role, and no reasonable adjustments are available
  • Fixed-term contract expiry — your contract ends while you are on leave
  • Serious misconduct — conduct unrelated to your illness, discovered while you are off sick

In each case, the employer must still follow a fair process. A redundancy during sick leave is not automatically unfair, but consultation requirements still apply.

When Is Dismissal While on Sick Leave Unlawful?

Dismissal may be unlawful if:

  • The reason for dismissal is your illness or absence (a general protections breach)
  • The employer failed to consult with you about your capacity to return
  • The employer did not consider reasonable adjustments that would enable you to return
  • The dismissal is discriminatory — based on disability, medical condition, or an underlying health issue
  • The employer retaliated against you for exercising a workplace right to take personal leave

Under the general protections provisions of the Fair Work Act, an employer cannot take adverse action against you because you have a workplace right — including the right to take paid personal leave.

What About Long-Term Sick Leave?

For extended absences, the line between lawful and unlawful dismissal narrows:

  • If you have exhausted your paid personal leave and your return date is uncertain, the employer may have grounds to consider termination on the basis of incapacity
  • The employer must still obtain medical evidence about your prognosis before making a decision
  • If your condition amounts to a disability under the Disability Discrimination Act, the employer must consider reasonable adjustments
  • Workers’ compensation cases have additional protections — dismissal while on WorkCover is unlawful if the reason relates to the injury

How to Know If Your Dismissal Was Lawful

Ask yourself these questions:

  1. Was the reason for dismissal genuinely unrelated to my illness?
  2. Did my employer consult with me before making the decision?
  3. Did they consider adjustments or alternative roles?
  4. Had I exhausted my personal leave entitlements?
  5. Did they follow the fair process outlined in my award or agreement?

If the answer to any of these is no, you may have grounds for an unfair dismissal or general protections claim.

FAQ

Can I be fired for taking too much sick leave in Australia?

If you have a legitimate medical condition and your absences are covered by medical certificates, dismissal for the absences alone may be a general protections breach. However, if the absences mean you cannot perform your role, the employer may be able to dismiss on capacity grounds — provided they follow a fair process.

Do I need to be at work to be dismissed?

No. Your employer can send you a termination letter while you are on sick leave. However, they must ensure the process is fair, including giving you an opportunity to respond to any concerns.

What if I’m on WorkCover — can I be fired?

If you are on workers’ compensation, dismissal because of your injury is unlawful. Your employer can still dismiss you for reasons unrelated to the injury — such as genuine redundancy or serious misconduct — but the burden of proof shifts to the employer to show the reason was not your injury.

How long does sick leave protect my job?

There is no fixed protection period. Once you exhaust your paid personal leave (10 days per year for full-time employees), further sick leave is unpaid. At that point, the employer may begin the process of assessing your capacity to return. However, the employer cannot simply wait and then dismiss — they must take active steps to consult and seek medical advice.

What should I do if I think my dismissal was unfair?

Contact the Fair Work Commission within 21 days of the dismissal. For unfair dismissal, you generally need at least 6 months of service (or 12 months for a small business). For general protections claims, there is no service requirement but the time limit is also 21 days.

You can take advantage of the free 14 days trial and explore Leave Balance.