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Can we dismiss someone who is on annual leave?

Can we give an employee notice of termination while on annual leave?
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Can we dismiss someone who is on annual leave?

Can we dismiss someone who is on annual leave?

9 June 2021

Can we give an employee notice of termination while they are absent on annual leave?

Q We have an employee who is absent on four weeks' annual leave. The employee has received a number of warnings during their two years of employment with the company and is on a final written warning. We have discovered the employee has transgressed on the same issue. Management want to dismiss the employee by sending notice by registered mail to his home address.

Our HR manager has questioned whether this is legal. Can an employer dismiss an employee who is absent on annual leave?

A While this circumstance is not considered by the Fair Work Act, or in awards or agreements, generally the answer is 'no'. The employer would need to wait until the employee returns from annual leave before giving notice of termination of employment (or payment in lieu). The right of an employer to terminate an employee absent on paid leave is dependent on the type of leave.

Industrial tribunals have usually determined that notice of termination by the employer will not be effective if it seeks to terminate the employee’s employment prior to, or at the same time as, a previously granted period of annual leave. See Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia and others v Silcar Pty Ltd [2013] FWC 856.

In this case, the Fair Work Commission used an example to illustrate the point. "For example, if an employer gives an employee four weeks’ notice of termination and after one week the employee is on approved annual leave for two weeks and returns to work out the notice for one week, then the two weeks on annual leave must be absorbed by the notice period and the employee re-credited with the annual leave or they must be given an additional period of notice.”

The FWC established that the right to notice and the right to annual leave are independent and cannot be used to cancel out the other right.

Another potential issue for an employer, in terminating an employee due to misconduct or poor performance while they are absent on annual leave, is complying with the procedural fairness requirements under unfair dismissal law. This may result in the employee not being given the opportunity to defend the employer's allegations and a denial of natural justice.


Long service leave

It is presumed a similar situation exists where an employee is absent on long service leave – that the employer must wait until the employee returns from long service leave before giving notice of termination. See Swingler v Methodist Ladies College [2002] WAIRComm 5170.


Personal/carer’s leave

While notice cannot be given during a period of paid annual leave or long service leave, this may differ when an employee is absent on personal/carer’s leave. Industrial tribunals have usually determined that an employer is entitled to give notice to an employee because the period of such leave is necessarily uncertain. However, this may differ where the employee is absent on a quantified period of sick leave.

It should be noted an employer should not terminate an employee on the grounds the employee is absent on personal/carer’s leave: the employee could bring a claim of unlawful dismissal to the FWC on the grounds the dismissal was due to the temporary absence from work of the employee due to personal illness or injury.

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