An employment contract is said to have been frustrated when the law recognises that the contractual obligation has become incapable of being performed because of a radical change in circumstances. For example, a change in the law or where events make it physically impossible for the contract to be performed, such as imprisonment or prolonged, indefinite absence due to illness or injury.
A common cause of frustration of contract is medical incapacity. In this situation the employee becomes unable to continue their employment because of ongoing disabilities caused by injury or illness.
The employer must be seen to take into account prevailing human rights, Health & Safety, Accident Compensation and employment legislation before acting to terminate an employee’s contract for reasons of frustration. Whilst such dismissals can be justified in some circumstances, they require careful handling on a case by case basis. Seek expert advice before terminating for reasons of frustration.
Contact the Help Desk for specialised assistance.
Also refer to Medical Incapacity Guidelines
Use the Certificate of Service Template
Note: Ensure you advise Payroll.
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