For employers and HR managers in Queensland, managing personal or sick leave is less about avoiding absence and more about responding to it confidently, consistently, and within the law. Decisions around medical evidence, extended absences, workplace injuries, and termination require careful handling to avoid unnecessary business risk. 

With the right process, clear communication, and an understanding of employee protections, employers can manage prolonged absences fairly while protecting their business. 

Here’s what you need to know to stay compliant with personal leave obligations. 

Paid personal leave: A legal baseline, not a perk 

Under the National Employment Standards (NES), full-time and part-time employees are entitled to 10 days of paid personal/carer’s leave per year, accruing progressively. 

Key employer obligations: 

• Allow access to leave for genuine illness, injury, or caring responsibilities  
• Accept reasonable evidence (medical certificates, statutory declarations) if requested
• Ensure unused leave rolls over year to year 

Refusing legitimate leave or placing barriers in the way of access can expose the business to claims.

Once paid personal leave expires, employees can still access unpaid personal leave for other circumstances. When unpaid personal leave does not apply, then absences due to personal illness or injury may be considered as unpaid leave (also often referred to as leave without pay or unauthorised absence), rather than personal leave.

The 3 month rule: Where dismissal risk spikes 

A common misconception is that employees on extended personal leave can be dismissed once they have been absent for more than 3 months. The law is tighter than that.

Under the Fair Work Act, an employee is protected from dismissal due to illness or injury if their absence is:

• Less than 3 consecutive months, or
• Less than 3 months total within a 12-month period

This protection applies only if the employee provides evidence when required. 

If you terminate an employee within this protected period, you are highly exposed to: 

• Unfair dismissal claims  
• General protections (adverse action) claims  
• Discrimination claims 

Once the absence exceeds 3 months of unpaid leave, the protection is no longer automatic, but termination is not automatically safe either. 

Beyond 3 months: Proceed with caution 

Employees are still protected from dismissal or other adverse action when utilising personal leave for longer than 3 months in circumstances where they are still producing medical certificates and still utilising paid personal leave. 

Once an employee has exhausted their accrued personal leave and their absence extends beyond three months of unpaid leave, employers may begin assessing whether the employee is likely to be fit to return to their role, and if so, within what timeframe. 

This is typically done by obtaining up-to-date medical evidence, consulting with the employee about their capacity and expected recovery and considering whether the inherent requirements of the role can be performed safely and effectively, with or without reasonable adjustments.

In some cases, if the medical evidence shows there is no capacity for the employee to be able to perform the inherent requirements of the role, medical retirement will need to be considered. 

Risk remains high if you: 

• Fail to obtain up-to-date medical evidence  
• Don’t explore reasonable adjustments  
• Cannot demonstrate a fair and documented process  

At this stage, claims may shift from unfair dismissal into: 

• Disability discrimination 
• Adverse action under the Fair Work Act

The Fair Work Commission will look closely at process, not just outcome, and decisions need to be made on factual medical evidence such as an Independent Medical Exam (IME) or a Functional Capacity Assessment.

If termination is being considered, employers must still follow a procedurally fair process. This includes meeting with the employee to discuss the medical evidence, consulting with them about any additional medical information, and considering whether reasonable adjustments may enable a return to work. After genuinely considering the employee’s response and all available information, if termination remains the only viable outcome, the employer will typically proceed through a formal show cause process before making a final decision. 

Workplace injury obligations

If the absence relates to a workplace injury, a different framework applies. 

In Queensland: 

• Workers’ compensation obligations (e.g. via WorkCover) are triggered  
• Employers must support return to work and rehabilitation plans
• Employees injured at work are generally protected from dismissal because of their injury for up to 12 months from the date of injury, although this protection does not extend to other dismissal reasons (e.g. unable to fulfil the inherent requirements)

Termination in these cases may breach: 

• Workers’ compensation laws  
• General protections provisions  
• Anti-discrimination legislation  

Before considering termination, employers should ensure they have actively supported the employee’s recovery process, complied with workers’ compensation obligations, and obtained appropriate medical and legal guidance. Only after the employee’s workers’ compensation claim is over and they have been absent on unpaid leave for a period of more than 3 months should medical retirement be considered.

Casual employees may have lower entitlements, but not lower risk 

Casuals are not entitled to paid personal leave but that does not remove employer obligations. 

They are still entitled to unpaid personal leave and protected from: 

• Adverse action for exercising workplace rights  
• Discriminatory treatment  
• Unlawful termination linked to illness or injury  

While casual employees have fewer leave entitlements than permanent staff, employers should still approach illness related absences carefully and consistently.  

The focus should remain on clear communication, fair decision making, and ensuring any action taken is based on legitimate operational reasons rather than the employee exercising a workplace right or managing a genuine illness or injury.

Evidence and process are your best defence 

Across all scenarios, the same principle applies: documentation and consistency are critical. 

Employers should: 

• Clearly communicate leave and evidence requirements – best practice would be via a Leave policy 
• Request medical updates where absences are extended  
• Maintain records of all communications and decisions  
• Apply policies consistently across the workforce  

A well-managed absence process is often the difference between a smooth return to work or medical retirement and a messy dispute.  

Employers who focus on clear policies, consistent communication, and properly documented decisions are better placed to support employees while also protecting the organisation.  

When expectations are set early and applied consistently, most absence situations can be resolved constructively and without escalation. 

Managing extended personal leave is not just about eliminating disruption in the workplace, it’s about navigating it lawfully.

As a general rule, terminating an employee who has been absent for less than three months is high risk and likely unlawful. After three months, termination may become possible, but only where employers can demonstrate a fair, evidence-based process and genuine operational justification.

Where a workplace injury is involved, additional statutory protections significantly increase legal exposure. Even casual employees, despite having fewer entitlements, remain protected under workplace laws when taking unpaid personal leave.

How can Business Chamber Queensland help?      

Business Chamber Queensland’s Workplace Advisory team provides practical, real-time support to help employers navigate personal leave protections with confidence.

From clarifying employer obligations and managing workplace risk to supporting sensitive employee conversations, our team helps organisations respond appropriately and in line with workplace laws. Whether you need clear policies, manager training, or case-by-case guidance, we can help you manage personal leave matters consistently, fairly, and compliantly.