It is possible for an employer to fire an employee who is out on medical leave. However, according to the law, the termination cannot be because of the medical leave or because of the underlying disability or medical condition.

Federal laws protect employees with disabilities from discrimination based on their medical conditions. They also provide for annual medical leave for employees with medical conditions. These laws include: the Family Medical Leave Act (FMLA) and the Americans with Disabilities Act (ADA).

The FMLA 

The FMLA grants eligible employees 12 weeks of unpaid medical leave for the birth and care of a new born, the adoption of a foster child, care for an immediate family member with a serious medical condition and personal medical leave because of a serious health condition.

The Act covers businesses with 50 or more employees, all located within 75 miles of each other. Additionally, not all employees in these businesses are eligible for leave. Only employees who have worked for at least one year for an employee or for at least 1250 hours in the immediately preceding year can apply for leave. (http://www.disabilitysecrets.com/resources/disability/long-term-disability/can-i-be-fired-while-leav )

During the time an employee is on FMLA medical leave, he/she is protected from undue termination. Upon completion of the medical leave, an employee can return to work to the same position or a substantially similar position, with equivalent pay and benefits.

The US Department of Labor defines an “equivalent” position as one that is virtually identical to the original position in terms of pay, benefits, and other employment terms.

There are, however, certain instances when an employer can legally terminate the employment of an employee during medical leave. These are the circumstances when an employee is not entitled to reinstatement after medical leave. They include:

• When an employee would have been laid off even if he/she had not taken the medical leave. If an employee is laid off in the course of medical leave, an employer’s responsibilities to maintain group health plan benefits and reinstate the employee effectively cease. The burden is on the employer to show that the employee would have been laid off even if he/she had not taken the leave. However, should the evaluation for workforce reduction be found to be suspect, the employee will have a cause for wrongful termination. In Cutcher V Kmart Corp. (http://www.ca6.uscourts.gov/opinions.pdf/10a0063n-06.pdf ) the 6^th circuit court held that layoff on medical leave on the grounds of poor performance where an earlier evaluation had indicated the employee had exceeded expectations was suspect and seemed to discriminate the employee exercising his FMLA rights. Restoration to a position that is slated for lay off will not meet the requirements of an equivalent position as per the Act.
• When an employer had already made a conscious decision to terminate the employee on grounds not related to the medical leave and at a time prior to the leave.  If a shift had been terminated or overtime work erased, the employee will not be entitled to reinstatement after leave.
• If the employee was employed for the performance of a specific contract or for a specific period of time, the employer has no obligation to reinstate the employee after the specific term is over and the employer would otherwise not have renewed the contract.
• If the employee had wrongfully applied for medical leave, the employer is not obligated to reinstate the employee.
• If the employer discovers major violations, acts of insubordination and acts of dishonesty done by the employee before the medical leave, he can terminate the employee during medical leave.  In Cracco V Vitran Express, Inc., the 7^th circuit court held that a service manager for a trucking company whose acts of document falsification and poor handling of deliveries were discovered during his medical leave, was not entitled to reinstatement.
•  If an employee extends medical leave, the employer may terminate him/her. (http://www.nolo.com/legal-encyclopedia/can-you-be-fired-from-job-while-leave-with-disability.html )

Duties of employer before termination

Before an employer can terminate an employee on sick leave for nondiscriminatory reasons, he/she is bound to comply with notice requirements of the FMLA (http://employment.findlaw.com/family-medical-leave/walking-the-fmla-termination-tightrope.html ). A covered employer should provide notice to employees of their rights and obligations under the FMLA. This can be done by:

• Posting notices in conspicuous places in the work area.
• Including a detailed and informative notice and explanation in employee handbooks.
• Specifically designating leave as FMLA leave
• Informing employees that taking leave will count against their available FMLA leave time.

Duties of employee

An employee on the other hand, is duly required to provide notice to the employer of at least 30 days before commencing the FMLA leave, or such notice as may be “practicable.”  If the employee fails to provide adequate notice, all protections under the FMLA may lapse.

Conversely, if the employer fails to give sufficient FMLA notice, the employee may be excused for not giving adequate notice for FMLA leave.

Even after exhausting the 12 weeks of FMLA leave, under the Americans with Disabilities Act (ADA), an employer with 15 or more employees may find it difficult to fire an employee on sick leave. This Act provides that employers should reasonably accommodate their disabled employees before deciding to fire them. (http://www.disabilitysecrets.com/resources/disability/long-term-disability/can-i-be-fired-while-leav )

Courts determine reasonable accommodation on a case by case basis and it can extend to giving employees additional unpaid sick leave as long as that does not cost the employer undue hardship.

An employee is not legally entitled to pay while on medical leave. However, there are benefits they are entitled to. (http://business.financialpost.com/executive/management-hr/can-a-company-fire-an-employee-who-is-on-sick-leave )Disabled employees should check their health insurance cover and benefits plan with a professional employment lawyer to determine just how much they are entitled to.