Handle with Care: Making Allegations of Serious Misconduct

We understand that when business owners have a strong hunch regarding an employee’s dubious behaviour, their instinct can be to act in a fast and decisive manner. Often angered and sometimes caught off guard by what appears to be serious misconduct, employers can be tempted to deal with a worker’s blatant misconduct at once – including via summary dismissal.

However in the recent matter of Platypus Shoes, Commissioner Iain Cambridge of the Fair Work Commission (FWC) demonstrated that a lack of fairness during an investigation into allegations of serious misconduct can irreparably affect the quality and acceptability of the outcome.
The commissioner found that the employer in this matter had misrepresented the nature of the employee’s behaviour, and had tainted possible future actions due to the manner of the investigation.

facts of the case

The applicant, Mr Jimenez, worked for the respondent as a shoe store manager. In October 2015, the applicant was summarily dismissed from his role with Platypus Shoes, on the basis of allegations that he had committed theft and fraud. Colleagues reported that Mr Jimenez had engaged in inappropriate behaviour such as wearing shoes that were on layby, not accounting for some $200 until after a week had passed (later described by the FWC as a retail ‘mortal sin’), taking four pairs of shoes from the shop, and providing a friend with the 20% family discount.

In response, the employer invited the applicant to a meeting on September 21, 2015, on the basis of wanting to discuss positive and favourable issues. Mr Jimenez attended the meeting alone and was promptly met with the allegations of theft and fraud. He was given the information in writing and told to respond within one day. After the applicant received legal advice, this period was extended. A further meeting was then called for October 9, 2015. After some discussion, Mr Jimenez was summarily dismissed from his employment in writing during a break in proceedings.

the right to be heard

On hearing from the parties, the commissioner pointed to certain fatal deficiencies in the manner in which the employer had acted against the applicant. Primarily, the employer appeared to have formed a clear opinion as to the nature and extent of Mr Jimenez’s alleged serious misconduct well before any opportunity was provided for the worker to properly receive and respond to the allegations.
And in calling the worker to the September 21 meeting alone and on the pretext of a positive discussion: “…[the employer] took steps to deliberately deceive him about the purpose of the meeting”.

It was noted by the commissioner that where allegations are particularly serious, decision-makers must ensure that the investigative process and resultant findings are of sufficient quality to meet the exacting standard set out in Briginshaw v Briginshaw (1938) 60 CLR 336.

evidence of a closed mind

The letter that the employer handed to the worker during a recess in the meeting of October 9 also demonstrated a high degree of pre-determination, for example with certain names being evidently inserted some time earlier.

Commissioner Cambridge noted that decision-makers must operate: “…with an open mind such that the opportunity represented some practical and realistic potential to persuade the decision-maker to a particular view.”

Of interest was the finding of the FWC that the employer might well have been able to establish a case of serious misconduct in relation to the seemingly misappropriated monies. Such behaviour indeed appeared to constitute a ‘mortal sin’ in the world of retail cash-handling. However, the unfortunate manner in which the allegations were pursued by the employer effectively tainted the evidence and precluded an otherwise reasonable course of action.
Before finding in favour of the worker and provided a small quantum of compensation, the commissioner made the sobering observation that:
“The procedural errors made by the employer have rendered what would have otherwise been an entirely fair dismissal with notice, to be an unreasonable and unjust summary dismissal.”

getting it right – every step of the way

It can be a fine line indeed between decisive action in the workplace against misconduct allegations and ensuring that the procedure is fair. Our years in working with businesses to ensure the best investigation possible have shown us many of the challenges that employers face in situations like Platypus Shoes. To avoid getting to mediation or court with a ‘tainted’ investigation, it is important that businesses understand the contours and potential pitfalls of a serious misconduct investigation.

Conducting proper workplace investigations would have made the outcome of this case a different story. If you handle allegations of serious misconduct or other workplace elements that require a proper investigation process then check out our course, Conducting Workplace Investigations (Advanced).