Depression is not a sackable offence

Depression affects around one in six Australians at some stage in their lives. In any given year, more than 1 million Australian adults experience the symptoms of depression, meaning this is an issue Australian employers cannot ignore.


Many people with depression are members of the workforce but in some cases depression can affect a person’s ability to work, as symptoms may change or worsen at times, impacting on productivity and engagement.

Untreated depression causes more than 6 million work days to be lost in Australia each year. This is the equivalent of a $10.9 billion reduction in economic contributions.

When depression, or another mental health condition, begins to impact on an employee’s performance, it may be tempting to an employer to terminate the worker in favour of a person in good mental health, who may be perceived as more reliable.

However, letting someone go due to a mental health condition contravenes workplace law and would likely be considered an unfair reason for dismissal. This was demonstrated recently when the Federal Circuit Court fined an employer and ordered the reinstatement of a terminated lawyer.

While the employer claimed the worker had been dismissed for misconduct, the court found that the employee was afforded protection from adverse action under the Fair Work Act. Judge Burchardt stated: “[The employee] is not the first, and will not be the last, person to suffer ill health interrelated with misconduct. The FW Act gives people in [the employee’s] position the benefit of protection. It is important that the nature of this protection be generally understood.”

The employer was ordered to pay the lawyer more than $90,000 in compensation along with a fine of $10,000 and was further required to reinstate the lawyer to his former position or a suitable equivalent.

Cases such as this show how important it is to support employees affected by mental health conditions; the judge in this instance noted that the employer was aware of the employee’s mental health issues, yet still acted inappropriately.

Employers concerned about the impact of depression and anxiety in their business are encouraged to seek advice and guidance from Heads Up, a workplace mental health campaign.


If a mental health condition has begun to impact on an employee’s work, it is prudent to seek advice from a specialist workplace relations or HR consulting firm. Furthermore, when investigating inappropriate behaviour or misconduct, engaging an independent workplace investigations provider who can make recommendations based on the investigation’s findings, will assist employers with ensuring subsequent action is appropriate and lawful.