We have an employee absent for 18+ months with a genuine condition and the advice I have received is that we could be seriously exposed if the Company moves to dismiss on the grounds of ‘capability’ because we would be in breach of contract, and potentially open to be sued at common law. There is no PHI in place but would that change the situation?

The existence of PHI would make it more difficult to terminate an employee who has been absent for 18+ months with a genuine condition. The fact that there is no PHI in place means that the employee has no additional contractual entitlement which could give rise to a common law claim for breach of contract in circumstances where the employee is dismissed.

However, dismissal by reason of incapability must always be carried out in a fair and reasonable manner in order to avoid any claim under the Unfair Dismissals Acts 1997-2007 (the "UD Acts”). In this respect, the UD Acts provide that dismissal will not be unfair if it results wholly or mainly from the capability of the employee for