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Terminating an employee on workers compensation in NSW – is it Legal?

If you’ve been terminated while you were on workers compensation, you’re not alone – it’s a fairly common occurrence. However, it’s not legal for your employer to terminate you within the first six months of your injury purely because you’re unfit to resume work.

Terminating an employee on workers compensation in NSW – is it Legal?

After the first six months an employer can terminate an injured worker, but only after they’ve met all their obligations to the worker. And even if the worker is terminated, they may still be eligible for workers compensation benefits, and there are avenues for seeking reinstatement – if that’s what the worker is looking for.

In this article we explain everything you need to know about termination of employment while on workers compensation, including an outline of the NSW rules, worker entitlements, and options available to workers facing redundancy while on workers compensation.

Your employer’s responsibilities to you when you’re on workers compensation/WorkCover.

Before an employer considers terminating you, even after the ‘protected period’ (six months from the date of injury), they’re obliged to do everything possible to help you get back to work.

Your employer is required to:

It’s in employers’ best interests to help injured workers get back to work, maintain the skills and knowledge of their experienced workers, reduce recruiting and training costs, and generally do the right thing by their staff. So, working with your employer to get back to work is always the preferred option.

However, when employers fail to adhere to their obligations, workers have the option to refer them to the workers compensation insurer and the State Insurance Regulatory Authority (SIRA). Failure to adhere to their obligations could see employers at risk of fines in excess of $11,000.

Termination of employment whilst on workers compensation/WorkCover – what happens to your entitlements?

If you’re terminated for not being able to do your job due to your injuries, your eligibility for workers compensation benefits doesn’t stop. In other words, if you’re receiving workers compensation benefits and your employment is terminated, you’ll still keep receiving your workers compensation benefits as long as your doctor certifies that you’re unfit to carry out your pre-injury duties.

Once you’ve left your employment, if your employer was previously paying your weekly benefits, this will now stop, and the workers compensation insurer will pay your weekly benefits directly to you.

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Termination of employment whilst on workers compensation/WorkCover – can you be reinstated?

If you’ve been terminated or made redundant purely because you were unfit for work due to your work injuries, you may be able to apply for reinstatement when you’re fit again.

Can you sue if you’re terminated whilst on workers compensation/WorkCover?

You don’t need to sue your employer to receive your reasonably necessary treatment expenses and weekly benefits if you’re injured at work – these are covered by workers compensation insurance, which all employers pay for.

However, being terminated doesn’t stop you from suing for work injury damages if your injury was caused by your employer’s negligence. A work injury damages claim is for a lump sum payout for past and future loss of earnings, lost because you’ve been unable to work or are unable to work into the future. To qualify for this lump sum your whole person impairment rating will need to be assessed at 15% or more.

Where can you get legal advice if you’ve been terminated whilst on workers compensation/WorkCover?

If you’ve been terminated or made redundant whilst on workers compensation and you have questions or concerns about your entitlements, you can call 13 15 and get free legal advice from a specialist workers compensation lawyer.

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