Is there clause for concern? The importance of getting employment agreements right when managing ill and injured employees

In this article, we consider the recent decision in Mr Bertus Moers v The Trustee For Williamson Family Trust [2025] FWC 1344, where the Fair Work Commission highlights the strategic value of well-drafted employment agreements, particularly when managing ill and injured employees (for example, in relation to directions for medical assessments, requests for medical evidence, return to work processes, etc.).

The background

Mr Bertus Moers (Employee) was engaged as an employee of The Trustee For Williamson Family Trust (Employer) from March 2021.

In early October 2024, just one week before a planned trip to New Zealand, Mr Moers met with the Employer’s General Manager and requested approval to work remotely from overseas (the Request). The Employer declined this request due to the short notice and practical difficulties associated with remote international work, and instead directed Mr Moers to apply for annual leave. However, Mr Moers advised that he would be taking carer’s leave to care for his ill mother.

The day before his departure, Mr Moers called in sick, prompting the Employer to request a medical certificate and supporting documentation evidencing the need to provide care, warning that without this, the absence would be considered unauthorised. Mr Moers submitted a medical certificate, followed by additional certificates, confirming that he was unfit for work until 31 December 2024. However, he did not provide any documentation specifically supporting his claim for carer’s leave.

In November 2024, concerned by inconsistencies in the reasons for Mr Moers’ absence and the vague information in the certificates, the Employer directed him to attend a capacity review with his treating practitioner. This included completing a form containing various questions about his condition, fitness for duty, and anticipated return to work, and returning it to the Employer. Mr Moers refused to comply, citing concerns including those related to his privacy. The Employer, noting that the employment contract permitted such medical assessments when relevant to the employee’s role, issued a final warning on 6 December 2024, stating that failure to sign a consent form for the capacity review by 9 December 2024 could result in termination.

Mr Moers did not respond, and the Employer dismissed him for serious misconduct the following day. On 1 January 2025, Mr Moers filed an application (Application) for unfair dismissal with the Fair Work Commission (FWC) under section 394 of the Fair Work Act 2009 (Cth).

The decision

The Employer responded to the Application and submitted that the dismissal was based on the Employee’s refusal to comply with a lawful and reasonable direction, pursuant to the employment contract. Specifically, the Employer relied upon the decision in Grant v BHP Coal Pty Ltd¹, where the Full Bench upheld Commissioner Spencer’s decision that:

1. it is permissible for an employer to direct an employee to undertake a medical assessment; and
2. failure to comply can constitute a failure to follow a lawful and reasonable direction.

The Employee contended that the direction was unlawful, claiming it contravened the Privacy Act 1988 (Cth) by seeking to access his “personal and medical information”. Further, the Employee submitted he believed the communications between the Employer and the Employee’s treating practitioner "may not be restricted to information solely related to his employment, and his current and future fitness to work".

Previously, it has been accepted that there is an implied common law right under State work health and safety laws for an employer to reasonably require an employee to attend a medical assessment.² However, Commissioner Chris Simpson found that the request made by the Employer for a capacity review was lawful and reasonable, on the basis that the employee’s employment agreement explicitly required participation in medical assessments. Specifically, Commissioner Simpson held “If it were not for the contract of employment, such a direction would not be lawful and reasonable in the absence of the Applicant’s consent”.³

The FWC accepted that the Employer acted to satisfy its workplace health and safety obligations and the Employee was dismissed because of his failure to follow a lawful and reasonable direction, rather than due to illness, injury or disability. The Commissioner held that Employer’s decision to summarily dismiss the Employee was fair and made on reasonable grounds, due to the Employee’s conduct being adequately serious to justify immediate dismissal. As a result, the Application was dismissed.

Tips for employers

To mitigate the risk of liability, employers should consider the below.

1.  Ensure employment agreements are up to date: The above decision, in addition to other recent decisions (for example, Elisha v. Vision Australia Ltd [2024] HCA 50), highlight the importance of ensuring employment contracts contain clear and comprehensive terms. Further, employment contracts should be regularly reviewed to confirm the provisions are valid, enforceable and support the business.
2.  Review policies to ensure they are clear and consistently applied: The employer’s actions in the above decision were supported by internal policies and procedures (including for taking leave, performance management, work health and safety, etc.). Recently, there has been an increased need for employers to implement policies and procedures. For example, recent changes to the Work Health and Safety Regulation 2011 (Qld) require employers (as PCBUs) to prepare, consult and implement a Sexual Harassment Prevention Plan.

¹. [2014] FWCFB 3027.
². Thompson v IGT (Australia) Pty Ltd [2008] FCA 994.
³. Bertus Moers v The Trustee For Williamson Family Trust [2025] FWC 1344 at 89.