Can You Fire An Employee For Calling In Sick In NZ?

Most small business owners have had that sinking feeling: your roster is tight, your deadlines are stacked, and an employee texts in that they’re sick.

Your first thought might be operational (“how do we cover this shift?”), but the bigger risk is legal: what are your employee’s sick leave rights, and what can you (and can’t you) do in response?

In New Zealand, you generally can’t dismiss someone just because they took sick leave. But there are situations where illness-related absences can still lead to a lawful dismissal - if you handle it carefully, act in good faith, and follow a fair process.

Below, we unpack the key sick leave rights NZ employers need to understand, the common dismissal traps, and the practical steps you can take to protect your business from day one.

What Are Sick Leave Rights In New Zealand (And When Do They Apply)?

In New Zealand, sick leave entitlements are mainly set by the Holidays Act 2003 (and then built on through your employment agreements and workplace policies).

At a high level, sick leave is there to support employees when they’re unwell or injured, or when they need to care for a dependent who is sick or injured.

How Much Sick Leave Do Employees Get?

Most employees become entitled to sick leave after 6 months of continuous employment, and then receive an annual entitlement (which can accumulate up to a cap).

The rules can get technical depending on work patterns and anniversary dates, so it’s worth having a clear reference point handy. This is why many employers keep a simple internal guide or payroll note that aligns with the legal minimums.

If you want a quick refresher, sick leave entitlements are a useful benchmark for what the legal minimum looks like in practice.

What Counts As “Sick Leave”?

Sick leave usually covers:

• the employee being sick or injured
• the employee needing to care for a spouse/partner, dependent child, or another dependent person who is sick or injured

Importantly, if your employee is genuinely sick and has entitlement available, taking sick leave isn’t a “favour” you’re granting - it’s a legal minimum right.

What About Mental Health Sick Leave?

From an employer perspective, mental health absences can feel harder to manage because the symptoms aren’t always visible and the timeframes can be unpredictable.

But in most cases, mental health can absolutely fall within “sickness” for sick leave purposes. Practically, that means you should treat mental health-related sick leave as you would any other illness: with consistency, privacy, and a process you can justify.

It can also help to understand how mental health sick leave commonly shows up in workplaces, so you can manage it fairly and confidently.

Can You Be Fired For Calling In Sick?

Usually, no - you generally can’t dismiss an employee just because they used sick leave, or because they told you they’re too unwell to work.

If an employee has sick leave available and is genuinely unwell, taking sick leave is part of their legal entitlements. Dismissing them because they exercised that right can put you at real risk of a personal grievance (for example, for unjustified dismissal or disadvantage).

That said, the real-world situations that lead to dismissal risk are often more complex. As an employer, you’re usually dealing with one of these scenarios:

• You suspect the sick leave isn’t genuine (e.g. patterns around Mondays/Fridays, or social media posts showing other activity)
• The employee is frequently absent and it’s affecting the business, but they keep providing medical certificates
• The employee is on long-term sick leave and you don’t have clarity on when (or if) they can return
• You’ve got performance or misconduct issues and sickness is happening around the same time

The key point is this: you can’t shortcut the process. Even if your business is under pressure, any action you take needs to be both substantively justified (good reason) and procedurally fair (good process).

When Can Sick Leave Lead To A Lawful Dismissal (Without Breaching Sick Leave Rights)?

There are situations where dismissal may be justified even where illness is part of the story - but the reason for dismissal must be lawful, and the process must be fair.

1) Misuse Of Sick Leave (Dishonesty Or Misconduct)

If an employee claims to be sick but is actually working elsewhere, travelling, or otherwise not being truthful, the issue isn’t “they took sick leave”. The issue is honesty and misconduct.

Even then, you should be careful. A photo of someone at a café doesn’t automatically prove they’re fit to work (or that they aren’t sick). Many illnesses still allow some activity, and you don’t want to jump to conclusions.

In practice, a defensible approach includes:

• gathering information calmly (not interrogating or publicly accusing)
• giving the employee a genuine opportunity to explain
• considering medical information appropriately (and privately)
• following your disciplinary process before making any decision

2) Ongoing Absences That Create “Incapacity” To Do The Job

If an employee is frequently absent due to illness over a long period, you may reach a point where you can say they are not able to perform their role on an ongoing basis (sometimes called “medical incapacity” situations).

This is one of the most misunderstood areas for employers. You’re not dismissing them for being sick - you’re considering whether:

• they can perform the job now (or in the near future)
• reasonable adjustments could help them return
• the business can continue to operate with the role unfilled or unstable
• medical information supports a likely return-to-work timeframe

These are fact-specific decisions, and they can go wrong quickly if you rush or assume.

3) Long-Term Illness With No Clear Return Date

Long-term sick leave can be incredibly tough on a small team - especially if you’re also covering shifts, paying overtime, or turning away work.

However, an employee being away for a long time doesn’t automatically mean you can dismiss them. You’ll generally need to show that:

• you sought appropriate medical information (with the employee’s consent)
• you consulted with the employee and considered their feedback
• you considered reasonable alternatives (adjusted duties, hours, workplace supports, or temporary solutions)
• the business impact is real and ongoing
• there is no reasonable prospect of a return within a reasonable timeframe

This is exactly where a strong Employment Contract and clear documentation habits make a big difference - not to “help you fire someone”, but to ensure you manage absences consistently and lawfully from day one.

4) Red Flags Around “Sick Leave” During Performance Management

Sometimes sickness overlaps with performance concerns. For example, you start raising issues about attendance, quality, customer complaints, or missed targets, and then the employee begins taking regular sick days.

You should be careful not to treat sick leave as “bad behaviour” - but you also don’t have to ignore unrelated performance issues indefinitely.

The safest approach is to keep the topics separate and process-driven:

• If the employee is unwell, pause any meetings that they can’t reasonably participate in.
• When they return, resume the process fairly, with clear expectations and support.
• If the employee says health is affecting performance, consider whether medical input or adjustments are needed.

If you’re unsure how to structure that, using a consistent Performance Management Process can help you avoid common procedural mistakes.

What Can You Ask For When Someone Calls In Sick? (Medical Certificates, Proof, And Privacy)

As a small business employer, you’re allowed to ask reasonable questions to manage staffing and verify leave - but you need to do it in a way that respects entitlements and privacy.

Can You Ask For A Medical Certificate?

In many cases, yes.

Under the Holidays Act 2003, you can require an employee to provide proof of sickness or injury (for example, a medical certificate). If the employee has been sick or injured for 3 or more consecutive calendar days, you can generally require proof at the employee’s cost.

If you require proof within the first 3 consecutive calendar days, you can do so - but you generally need to pay the reasonable cost of obtaining that proof.

Practically, it’s best to:

• have a written policy explaining when proof may be requested
• apply it consistently (avoid targeting one person)
• keep the request neutral and operational (not accusatory)

A well-drafted Workplace Policy is often the simplest way to make sure managers handle sick leave requests consistently across your business.

How Much Medical Detail Can You Request?

Be cautious here. You generally don’t need (and often shouldn’t collect) detailed diagnoses. Usually, you need confirmation that the employee is unfit for work and the expected timeframe.

Health information is “sensitive” personal information. You should limit collection, store it securely, and only let the right people access it.

If you’re building better internal systems around health and leave information, an Employee Privacy Handbook can be a helpful framework for handling sensitive workplace data.

Common Employer Mistakes That Increase Dismissal Risk

Most unjustified dismissal claims don’t happen because an employer wanted to do the wrong thing - they happen because the employer was under pressure and acted quickly.

Here are common traps we see for small businesses dealing with sickness-related absences.

1) Treating Sick Leave Like Misconduct

If you discipline someone for being sick (without evidence of misuse), you’re stepping into risky territory. Remember: sick leave exists to be used.

2) Inconsistent Treatment Between Employees

One employee gets asked for medical certificates every time, while another doesn’t. Or one team is allowed to “text in sick” while another must call. Inconsistency is a big red flag in disputes, because it suggests unfairness or bias.

3) Skipping Consultation And Process

Even if you think the outcome is obvious, you generally need to:

• raise your concerns clearly
• give the employee a chance to respond
• consider their explanation genuinely
• take time to assess options before deciding

“We didn’t have time” is understandable in a busy business - but it’s rarely a legal defence.

4) Using The Wrong Type Of Leave As A Workaround

Some employers try to “fix” ongoing sick leave by forcing annual leave. That can create a second legal problem on top of the first.

If you’re considering directing leave (for example, during a shutdown or where entitlements are high), it’s worth checking whether annual leave can be directed in your situation, rather than assuming it’s a quick solution.

A Practical Step-By-Step Approach For Employers Managing Sick Leave Issues

If you’re dealing with frequent absences, suspected misuse, or long-term illness, a calm and structured approach will usually give you the best legal protection (and the best chance of an outcome that works for the business).

Step 1: Check The Basics First

• How much sick leave is the employee entitled to right now?
• Have they followed your usual notification process (e.g. calling before shift start)?
• Is there a pattern, or is this an isolated absence?

Step 2: Document What Happened (Without Editorialising)

Keep notes like:

• date and time of the sick call/text
• who received it
• what was said (briefly and factually)
• any operational impact (e.g. shift unfilled)

Avoid emotional language (e.g. “obviously lying”). Documentation is most useful when it’s objective.

Step 3: Request Proof Only If It’s Appropriate

If you’re requesting a medical certificate, do it consistently and in line with your policy or agreement.

Step 4: If Concerns Continue, Start A Formal Process

Depending on the issue, that could be:

• a disciplinary process (for suspected misuse/dishonesty)
• a performance management process (where attendance is a performance expectation)
• a medical incapacity process (for long-term or repeated illness)

This is the point where getting advice early can save you a lot of cost and stress later.

Step 5: Only Consider Dismissal As A Last Resort

If you ultimately reach dismissal, you want to be confident you can show:

• there was a genuine business reason
• you followed a fair and reasonable process
• you considered alternatives
• you treated the employee consistently and in good faith

Many employers also find it helpful to use a structured set of documents when ending employment, so the process is consistent and properly recorded. That’s where an Employee Termination Documents Suite can be useful, especially if you’re managing multiple people or sites.

Key Takeaways

• Sick leave in New Zealand is protected by law, and you generally can’t dismiss an employee just because they took sick leave.
• You may be able to lawfully dismiss where there is a valid reason (e.g. proven misuse/dishonesty, or genuine long-term incapacity), but only if you follow a fair process.
• Requesting medical certificates can be lawful, but you should do it consistently, avoid unnecessary medical detail, and store health information securely.
• Common mistakes include acting too quickly, treating sickness like misconduct without evidence, applying rules inconsistently, and skipping consultation steps.
• A clear Employment Contract and Workplace Policy help you manage sick leave consistently and reduce disputes before they start.
• If you’re moving toward a formal process (disciplinary, performance management, or medical incapacity), getting tailored legal advice early can reduce your dismissal risk significantly.

Disclaimer: This article is general information only and does not constitute legal advice. For advice about your specific situation, consider getting legal advice.

If you’d like help reviewing your sick leave process, updating your employment documents, or managing a tricky absence situation, you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.