- Jim Roberts, Partner, Hesketh Henry
Most employers won’t relish the idea of having to fire someone. However, sometimes an employee’s actions (or inactions) may be so serious that the decision to terminate the employee’s employment might not appear to be a difficult one.
Can you simply channel your inner Donald Trump (or Arnold Schwarzenegger for that matter) and in the heat of the moment say “you’re fired”? No matter how good that may have felt for Donald, the answer is no. Like every other aspect of employment law, a lawful process must be followed, even for very serious behaviour where you are ‘certain’ that the conduct occurred.
What conduct are we talking about?
Summary dismissal, that is, dismissal without notice, may arise in relation to serious misconduct, and sometimes where misconduct is repeated. While some employment agreements or policies specify behaviour amounting to serious misconduct, this is not determinative. The focus is on whether, as a result of the conduct, the employer has lost trust and confidence in the employee. Usually this requires deliberate conduct of such gravity that an employer can swiftly conclude that its trust and confidence in the employee was destroyed.
What constitutes serious misconduct will depend on the nature of the business to some extent, but certain behaviours, for example physical or sexual assault, acts or omissions seriously affecting health and safety (particularly in a safety sensitive workplace) theft or fraud, would likely reach the threshold.
What process must be followed?
While some incidents might be so flagrant or reckless and easily evidenced (for example by security footage) that they appear to justify termination on the spot, it is important that the alleged behaviour is properly investigated and a lawful process is carried out.
As with any other disciplinary investigation, the employer must follow a fair and reasonable process:
- Consider whether suspension is lawful and appropriate.
- Investigate the allegations including putting the allegations of serious misconduct (or repeated misconduct) and all information to employee, provide employee with opportunity for a representative and/or support person to be present, and advise of possible sanctions.
- Provide employee with reasonable opportunity to respond to allegations.
- Consider any feedback from employee, investigate further if required and reach a decision on whether serious misconduct has occurred. Remember that the evidence in support of the allegations must be as convincing in its nature as the charges are grave – i.e. the more serious the allegations, the stronger the evidence needs to be.
- Advise employee of proposed sanctions and put this to the employee to provide feedback on proposed sanctions.
- Consider any feedback from the employee on the proposed sanctions.
- Reach a decision on the sanction and implement.
If having gone through the process above the employer determines serious misconduct has occurred and that summary dismissal is justified, the “summary” aspect refers to the termination of employment without payment of the employee’s contractual notice period or the ability to work out their notice period. The contractual notice period can be significant, particularly for senior or specialist roles, so as well as the obvious loss of future income, this has substantial repercussions. The sanction of summary dismissal should be applied cautiously.
Ultimately the legal test is whether the employer’s actions, and how the employer acted, were what a fair and reasonable employer could have done in all the circumstances at the time the dismissal or action occurred. That includes, at a minimum, the consideration of the factors outlined above.
On discovering an apparent incident of serious misconduct don’t be too hasty or jump to conclusions – the matter must be fully investigated and a fair and proper process carried out.
There have been many cases where what appeared, at first blush, to be serious misconduct had a perfectly plausible explanation. If, on the other hand, there is clear evidence of the alleged conduct, the process is likely to be swift and without too much palaver.
About Jim Roberts:
Jim helps his clients at Hesketh Henry, who are from a range of industries, develop their employment strategies which include collective bargaining, personal grievance processes, disputes, human rights, health and safety and accident compensation. As well as providing strategic legal advice, Jim has been involved in collective bargaining in industries as varied as aviation, maritime, dairy, meat, finance, electricity, telecommunications and insurance.
Jim will be a key speaker at the upcoming Employment Law Matters Forum New Zealand in March. See which session he is speaking on here: www.elf-nz.employmentlawmatters.com. Another great article by Jim can be read here.