What if your employee can’t make it to work due to suffering from, or being in quarantine from, the Coronavirus? In this short article we explain your obligations.
There are three ways employers can manage absences due to the Coronavirus. First, if your employee presents a certificate from a medical practitioner that he/she is suffering from or is in quarantine due to the Coronavirus, you can allocate available paid personal leave to the absences. Second, if your employee is casual or does not have available leave, you can allocate leave without pay to the absence. Although you may not have an obligation to agree to leave without pay, if the period is temporary, and the alternative is your employee coming into contact with staff and patients, then utilising leave without pay seems both sensible and less risky. Third, where your employee requests to use available annual leave for continuity of payment, you may also choose to agree to this request.
The situation becomes complicated where your employee has extended time off or does not return to work. The law currently provides that employers cannot take action against an employee due to temporary illness. Temporary illness means up to 3 months of absences in a year. This is obviously a lot more than the 10 days personal leave. You will generally have more options once your employee is absent for 3 months or more, and we suggest you take legal advice if you want to act on this.
What if your employee is not able to return to work at all? Fundamentally and historically, employment law derives from contract law. It is a basic principle of contract law that where one or both parties are prevented from meeting their obligations due to an unforeseen event, the contract can be frustrated and come to an end. A simple example is where there is an earthquake and the Practice cannot be accessed and used anymore. Another example is where your employee’s visa to work in Australia is revoked and he is required to leave the country. Over the years, this principle has been tested in its application to employment contracts. In the NSW decision of Mahoney v White, the Fair Work Commission considered whether the employee’s employment was frustrated, and therefore came to an end naturally, as a result of new legislation being effected which prevented the employee from working with children, which was an essential requirement of his role as a teacher. In this case, the employer argued the employment was frustrated and ended naturally, and the employee argued he was unfairly dismissed at the initiative of the employer.
This case was eventually decided on appeal to the Full Federal Court, which noted the new legislation would frustrate an employment contract if it effectively revoked the employee’s licence to work in the role. However in this case, the employee was first suspended from work due to allegations of inappropriate conduct, and remained suspended for 6 months after the new legislation came into effect. His employment was then terminated as a result of the allegations, rather than at the time the legislation came into effect. The Court decided the employment was terminated at the initiative of the employer and the unfair dismissal laws apply.
This decision sets a high bar for employers to successfully rely on frustration for an employment contract to naturally end. However it also clarifies that contracts can be frustrated, including through the introduction of new regulations that prevent an employee from carrying out his/her role, but illustrates that the termination has to be processed in a timely manner.
In this situation, it would have been better for the employer to communicate the reason for the employment ending was due to new legislation which frustrated the contract. Again this case reiterates the importance of following a proper process when effecting a termination or when taking disciplinary action.
In addition to the options outlined above, if your employee contracts the Coronavirus and becomes unable to work at all any more, it is possible the employment may be frustrated and come to an end naturally. Given the complexities as explained above, separate legal advice should be sought for individual circumstances.