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Termination of Employment on the grounds of continued ill health

Termination of Contract on the grounds of continuing Ill Health

If an employee indicates that they are unfit to return to their post or any other suitable alternative post then termination of contract on the grounds of continuing ill health can be discussed at a long term Formal Absence Review meeting with their line manager.

The line manager should confirm to the employee any outstanding annual leave. The Working Time Directive allows a maximum statutory amount of 28 days to be paid, deducting any annual leave already taken within the leave year entitlement.

The employee should also be advised that they are entitled to notice of termination which is paid over a period of up to a maximum of 3 months or they may wish to choose to have this payment paid as lieu of notice and therefore would receive a lump sum.

Notice of termination is one week’s pay per completed years of service, up to a maximum of 12 week’s pay. Annual leave continues to accrue if the employee chooses to be paid notice of termination.

The employee should be advised that a formal hearing with a manager who reports directly to a Director or Chief Officer with authority to dismiss can be arranged for a decision to be made regarding their future employment.   However, if the employee declines the opportunity to meet with the appropriate manager with authority to dismiss the following process must be followed:

  •          The line manager writes to the employee confirming the details discussed at the Formal Absence Review meeting advising that a recommendation for the termination of contract on the grounds of continuing ill health will be made to the appropriate manager with authority to dismiss and any agreed proposed termination dates as well as confirming the employee’s decision regarding payment in lieu of notice as a lump sum or paid over the termination notice period.
  •          The line manager writes to the appropriate manager with authority to dismiss detailing the background to the case, enclosing the relevant supporting documentation seeking consideration for the termination of contract on the grounds of continuing ill health. 
  •          Following a review of the relevant supporting documentation the appropriate manager with authority to dismiss will write directly to the employee to provide confirmation of their decision. The letter, if applicable will detail the termination date, any pay in lieu of notice or payments over the termination notice period, outstanding annual leave and the right of appeal.

 It is essential an up to date Occupational Health report is obtained for any employee who is potentially unable to return to work due to ill health. If an employee is intending to submit an application to the Scottish Public Pensions Agency the Occupational Health Service will, if applicable, complete an AW8/MED form to support the application. However, it is important to note that any decision regarding the release of a pension rests solely with the Scottish Public Pensions Agency and will not impact of the Board’s decision to terminate an employee’s contract on the grounds of continuing ill health.

Termination of Contract on the grounds of continuing Ill Health

If an employee remains unfit to return to their post or any other potential suitable alternative post but does not agree to termination of contract on the grounds of continuing ill health, the case should then be referred to the appropriate manager with authority to dismiss for further consideration at a disciplinary hearing.