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Medical incapacity – is it just too hard for employers?

Crutches2It is well known that the Department of Corrections has a big shortage of staff. According to figures provided by Corrections last month 76 of the 1438 community corrections jobs are vacant and 415 of the 4060 prison-based roles are vacant.

It is also fairly well known that it is difficult for an employer to justify terminating the employment of an employee for medical incapacity. In the recruitment void that Corrections has been in it is hard to understand why Ms Tyer, a Corrections Officer with 28 years experience, was dismissed on medical grounds.

The recent Employment Relations Authority decision of Tyer v Chief Executive of the Department of Corrections found that the dismissal of Ms Tyer was unjustified. The Authority awarded her 3 months lost remuneration and $20,000 compensation.

Ms Tyer suffered a non-work injury when she fractured her ankle in 2019 after she fell on some stairs. Rehabilitation was not straight forward and there were various medical interventions to address a series of issues that hindered her recovery. After two years, she was advised that ankle fusion surgery was her best treatment option and also her best chance at getting back to her full duties. It was during this period while Ms Tyer was awaiting surgery that she was dismissed.

At the time of her dismissal, Ms Tyer had been on light duties for eight months in the Kaupapa Māori Pathway Unit. Ms Tyer said Corrections could have awaited the outcome of her ankle fusion surgery and estimated recovery time before making a final decision.

The Collective Employment Agreement that Ms Tyer was employed on required a decision to dismiss on medical grounds be based on two medical assessments from independent medical practitioners. Corrections relied on letters from Ms Tyer’s surgeon and a report from her general practitioner. Ms Tyer thought that the information they provided was positive because the ankle fusion surgery provided the best option to be able to get back to work fully within four to six months. She said that it was usual practice to be allowed approximately 12 months after a return to light duties, to pass the Physical Readiness Test (a requirement for all Corrections staff in a custodial environment).

Corrections on the other hand formed the view that the medical information supported its decision to medically retire Ms Tyer on the basis it was likely her medical condition would continue into the foreseeable future, there was no certainty as to when Ms Tyer would return to work, and an absence of a further six months could no longer be sustained.

Dismissing an employee for medical incapacity is fraught with difficulties. The starting point is an old vague caselaw driven test as to whether an employer “can fairly cry halt”. More recent cases have provided some guidance on what that might mean. Some factors include the type of position held by the employee (is it a key position); the nature of the illness or injury, how long the incapacity has continued and the prospects of recovery; the possibility of a graduated return to work; the length of service of the employee; and whether reasonable interim arrangements can be made (such as light duties or employing a temporary worker).

Corrections said it was in a position to “fairly cry halt” in all the circumstances including Ms Tyer’s inability to do her job for a lengthy period, her upcoming operation and further necessary rehabilitation. Further, she was accommodated on light duties for a three month and then eight-month period and redeployment was open to her through a contestable recruitment process. She applied for one position but was unsuccessful. Corrections was in the position of needing to fill her substantive role and faced challenges that impacted on the running of the prison in finding cover for her in her substantive role. Read more....

Ms Tyer said she could still perform work for Corrections while she was injured given the nature of the organisation, and the practice of time allowed to do the Physical Readiness Test should have meant she was allowed extra time from the point she was signed off as fully fit. She said the medical evidence indicated she would be able to return to full duties within a reasonable time after her ankle fusion surgery.

The medical prognosis was said to be central to Corrections decision making. The Authority said the advice provided needed to be carefully and objectively considered given the decision to terminate Ms Tyer’s employment predominantly turned on that advice. The Authority agreed with Ms Tyer that the medical prognosis could be viewed as favourable, despite Corrections’ view that it was not.

In reaching its decision concluding that Ms Tyer was unjustifiably dismissed, the Authority also took into account the nature of Corrections as an employer and Ms Tyer’s length of service. The Authority said Corrections is a large employer with such size and resources that it could have accommodated Ms Tyer and considered her more carefully for redeployment before deciding to terminate her employment.

With 28 years of experience and so many vacancies surely Corrections could have found an alternative role for Ms Tyer. However, the irony in this case is that even six months after her surgery Ms Tyer still was not fully fit to return to full duties. There surely must be an easier and more certain path for employers to “fairly cry halt”?