Was it a sackable offence? The grey area of misconduct

Hard work deserves reward and celebration. But when do festivities cross the line? The Federal Court of Australia recently heard a case where a commercial leader paid more than $400,000 was fired for swearing at the owner of a house the employer had rented for a project.

The incident occurred around 1am, when the property owner asked the partiers to keep the noise down. Festivities had kicked off at 6pm.

The sacked worker argued that the employer’s investigation was flawed, his conduct did not amount to serious misconduct, and that proper termination procedures were not followed.

A worker who misbehaves away from the office might claim in their defence that they weren’t at work, but when an event is related to work the rules are clear.

“There is no difference between conduct that occurs within the workplace as compared to conduct that’s afterhours at a Christmas party or social event,” said Baker & McKenzie partner Kellie-Ann McDade. “It is about whether that conduct has an impact upon the ongoing employment relationship and the seriousness of that impact.”

Assessment of credibility

For summary termination to be justified, the employer must clear a high threshold to demonstrate serious and wilful misconduct, she said.

“[Summary termination of employment] requires a fundamental breach or repudiation of the employment contract,” McDade said, adding that isolated incidents are usually not sufficient to justify serious misconduct. “It requires an assessment of the objective facts of what’s occurred.”

Investigation of complaints or allegations is a difficult process and sometimes requires specialised skills, she said.

“Even if there are competing stories it is OK for an HR manager or an investigator to come to a view on whether something did or didn’t occur based upon their own assessment of the credibility, biases or potential interests they perceive the people they’ve investigated to have,” McDade said. “It’s not necessary to always have a smoking gun.”

HR’s role when investigating misconduct

When competing views and unclear evidence make it hard to determine whether serious and wilful misconduct has occurred, McDade suggests in some instances it is preferable to terminate with notice if the conduct still justifies a sacking. “That can help mitigate any potential claims,” she said.

HR managers involved in investigations will need to honestly assess their own biases. “It may be that you’re not the appropriate investigator,” McDade said.

The process of substantiating – or not substantiating – an allegation of misconduct can be made tremendously difficult when there are opposing views on something that has occurred in or outside the workplace.

For McDade, the starting point is to assess whether there may be grounds for a claim of unfair dismissal.

“The procedural fairness of the investigation process and the validity of the reason for termination will be much more in the spotlight if someone is making an unfair dismissal claim as compared to, for example, a general protections claim,” she said.

How training can reduce misconduct

To reduce the opportunities for claims of unfair dismissal, employers should provide appropriate training, proper induction programs and monitor workers during their employment.

“That is done better in certain industries than other industries,” McDade said. “Organisations that lead from the top often find their incidents of misconduct are minimised. A culture of good behaviour starts with your leaders.”

Good employers have realised a different standard of conduct now applies and have put in place good policies and procedures to ensure people are not leading themselves into error, McDade said, “by drinking too much or acting inappropriately.”

It doesn’t matter if bad behaviour happens at work or at a work-related event away from the office. “If there is any string of connection with work, there is going to be the potential liability imposed on the employer for what’s occurred,” she said.