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Dismissals: Beyond the Investigation

April 23, 2018

By Alex Millman and Lindsay Carroll, NRA Legal

When an employee has done the wrong thing, it is natural to feel aggrieved. However put-out you may be, you must always remember to step back from the situation and be objective when responding to misconduct in your business and if appropriate, determining a disciplinary outcome.

It is commonly believed that once an investigation into alleged misconduct has been concluded, and you have proven that the employee has committed an act of misconduct, you are free to proceed directly to dismissal.

In this article, we will discuss the essential elements of due process that need to occur between an investigation concluding and a dismissal.

What good is an investigation?

 A fair and thorough investigation is essential, especially in more complicated cases, for you to be able to show that there is a valid reason for dismissal, and that you as the employer have a reasonable basis for taking disciplinary action.

 If the Fair Work Commission ends up scrutinising a dismissal, they will be looking to see if you have any evidence to support the reason for dismissal. In the absence of such evidence, you will fall at the first hurdle.

What comes after the investigation?

Section 387 of the Fair Work Act 2009 (Cth) sets out a number of criteria which the Fair Work Commission will consider when evaluating whether a dismissal was harsh, unjust or unreasonable.

The first of these – whether there was a valid reason for the dismissal – is where the investigation itself comes into play.

The remaining criteria relate to the process through which the employee proceeds to dismissal, and it is here where employers tend to mix things up, to their detriment.

Procedural fairness under the Fair Work Act 2009

If you read section 387 of the Fair Work Act 2009, you will see that the procedural elements all have one thing in common – they talk about the employee being told of, and having an opportunity to respond to, the reasons for dismissal.

This is typically known as a “show cause” process – that is, the employer is of a mind to dismiss the employee, and is asking the employee for one good reason why they should not follow through with this course of action.

 An employee may use the show cause process to assert their innocence, or a flaw with the investigation process  and so, the show cause process is a useful tool for an employer as a means of risk assessment.

“Any other matter”

In determining whether a dismissal is harsh, unjust, or unreasonable, the Fair Work Commission has a broad discretion to consider “any other matter” relevant to the case.

For example, in a recent case where an employee had verbally abused and threatened violence against his co-workers following an investigation – by his own admission, he had “done something horribly wrong” – a Full Bench of the Fair Work Commission held, by majority, that his dismissal was nevertheless harsh.

In deciding this, the Full Bench considered that, among other matters:

  • the employee had a mental health condition which resulted in increased alcohol consumption (the employee was intoxicated at the time of the conduct);
  • the employee’s medication had been increased shortly before the conduct, and he had been having trouble adjusting to it;
  • the employee had recently lost a close family member and was struggling with grief as well as depression;

all contributed to the dismissal being harsh, and resulted in the employee being reinstated to his former employment.

While investigations into conduct are very good at determining what actually happened, they are not so good at delving deeper into the reasons why the conduct happened.

If the employer in the above case had knowledge of the other relevant matters considered by the Full Bench, it may have altered their decision making process when determining whether to dismiss the employee.

So what should I do?

If you have a policy or procedure in your business that prescribes how performance counselling and disciplinary action is to occur, in all circumstances, follow the process prescribed by that procedure and seek advice where required.  

In the absence of any formal disciplinary process and where you have investigated misconduct by an employee, and determined that they are in fact guilty, take the time to discuss the matter further with the employee. This discussion should occur by reference to the relevant evidence gathered as part of the investigation and the standards of behaviour in place at the workplace (which may also be prescribed by policies and procedures).

In circumstances where dismissal is an appropriate disciplinary response to misconduct, tell the employee that you are thinking of dismissing them, and invite them to tell you why they should not be dismissed.

This is where the employee may raise personal or other circumstances which you ought to take into consideration when weighing up whether to dismiss the employee.

Too often, we see employers skipping this step, only to be taken by surprise when these considerations are before the Commission.

Accordingly, if you would like our assistance to prepare a performance counselling and disciplinary procedure for your business, please contact us. Above all, in circumstances when you need to respond to instances of alleged misconduct in your business, we recommend that you call NRA Legal on 1800 RETAIL (738 245) to seek advice on how to manage the process and to properly understand the risks.

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