Recent unfair dismissals breach laws

Dismissals for theft, safety breaches and deliberate misconduct found unfair

March 2010

Three recent decisions of Fair Work Australia have found that dismissals for misconduct have breached unfair dismissal laws. The following cases highlight that employers need to follow proper procedures and to consider all of the circumstances, even in the event of serious misconduct.

1. Dismissal for theft was unreasonable
A manager at a transport company was summarily dismissed for stealing from his employer to fund social events. Fair Work Australia found that the employee had been ‘deliberately dishonest’ and that he had ‘conspired to defraud’ his employer. Nevertheless, an inadequate and inequitable investigation meant that the dismissal, while ‘inevitable’, was unreasonable.

In particular, the employer was criticised for:

• failing to take action against two other employees involved in the misappropriation of funds; and
• conducting a cursory investigation that relied heavily on the information provided by the other employees implicated in the misconduct.

2. Dismissal for safety breaches was harsh - ‘personal circumstances’ were relevant
Fair Work Australia found that an employee’s repeated failure to wear safety glasses, and his abusive response to managements’ directions to do so, amounted to ‘relatively serious misconduct’ but that the resultant dismissal was harsh.

The decision focused heavily on the employee’s personal circumstances and the ‘disastrous’ effect that the dismissal would have on his life. In this regard, the tribunal noted that he was 44 years of age, had no qualifications, two young children and a mortgage, and that his wife suffered from depression and did not earn a large income.

Taking these factors into account, Vice President Lawler found that the employee should have been warned that a failure to wear safety glasses could result in disciplinary action.

Given the employee’s genuine contrition shown at the hearing, the employee was reinstated.

3. Dismissal for deliberate misconduct was harsh
In this matter, a senior member of staff at a leagues club with 33 years of service was summarily dismissed for emailing documents containing clearly commercially sensitive information to her husband, who worked for a competitor.

The Commissioner accepted that the action was deliberate misconduct, a breach of the employer’s policies, and had the potential to cause serious harm to the business. However in finding that the conduct was not serious misconduct, the Commissioner noted that the employee had not intended to harm her employer but was attempting to assist her husband with his work.

Accordingly, given the employee’s length of service, the dismissal was harsh and the employer was ordered to pay 12 weeks pay in compensation.

4. Lessons Learnt
Instances of dishonesty, theft and deliberate misconduct are valid reasons for termination. However the concept of ‘fairness’ requires more from employers. The above cases illustrate the need to:

• conduct a proper investigation;
• treat staff equitably; and
• consider any mitigating circumstances (including, potentially, an employee’s personal circumstances).

Inevitable, justified and understandable dismissals may still be deemed unfair.

For further information, please contact Roland Hassall.  Roland has over 17 years' litigation experience and is a Partner in the Workplace Relations and Safety Group in the Sydney office of national law firm Sparke Helmore.