Understanding what constitutes gross misconduct, what isn’t and the process a business needs to follow to minimise their risks.
According to Fairwork Australia, gross misconduct, also known as serious misconduct, is any “conduct by an employee that is intentional and causes serious immediate risk to the health and safety of a person, or the reputation, viability or profitability of the business as well as deliberate behaviour that is inconsistent with continuing their employment”.
In essence, it is conduct that is considered so serious that, under the Fairwork Act, an employer is entitled to dismiss an employee for a first offence without notice, also called summarily dismissal.
Sounds simple? So why does this go so wrong for employers?
Fairwork describe gross misconduct to include theft, fraud, assault, or refusing to carry out a lawful and reasonable instruction that is part of the job. Gross misconduct can also include serious or continued breach of the terms of the Employment Agreement, any acts of dishonesty, breach of company policy such as code of conduct, workplace behaviour or IT and security polices, any conduct which is likely to negatively impact the company reputation or business, as well as a criminal conviction. However this is not an exhausted list, although these are several behaviours that would normally amount to gross misconduct, there is no definitive comprehensive list.
It is for this reason, it is essential that employers protect themselves and their entitlement to dismiss for gross misconduct by ensuring that they have policies in place or provisions in the employment contracts that outline examples of what is considered gross misconduct.
In addition to this, not only it is important to have documented what behaviours constitute gross misconduct, but also what the consequences could be for engaging in them. Whether by including this in the employment contract or by ensuring appropriate polices are readily available and agreement to conduct oneself in accordance with these written in the contract, clearly communicating that the consequence could potential be up to and including instant dismissal is key to ensuring you can follow through if required.
All too often, companies risk potential costly unfair dismissal claims when trying to terminate an employee for gross misconduct. Without proper documentation and communication, it can be deemed unreasonable or unfair for an employer to assume an employee knew their conduct was in fact misconduct, or that a consequence was potential dismissal.
This could be a very costly and time consuming mistake that could lead to both large fines and potentially having to reinstate the employee. It is important to consider the risk of unfair dismissal as well as constructive dismissal.
It is also important to remember that unfair dismissal claims have an eligibility criteria, such as minimum employment period as well as high income thresholds. Employees in businesses with more than 15 employees must have worked continuously for at least 6 months before they are eligible to make a claim. Likewise, employees whom earn over the high income threshold (currently $136,700) are exempt from making a claim unless they are covered under an award or applicable enterprise agreement. That is not to say a company is risk free from these groups – either could explore civil action for damages.
Unfortunately for companies, it is still not as simple as ticking the box. Even once an employer has documented and communication this expectation, if this is not followed through and maintained, an employee could potentially claim that it would be unreasonable or unfair to dismiss the employee as this was not consistently enforced, or even that the Company ‘culture’ is such that the behaviour in question is accepted.
For example, an offensive email sent by an employee, depending on the severity of it could potentially constitute gross misconduct. However, perhaps in the Company employees send these types of emails to each other in jest with varying degrees of ill humour. However on this occasion, the Company has decided they need to act. Although alone, this was a breach that could constitute gross misconduct, an employee could potentially argue that this sort of banter in internal emails was common place, without prior reprimanded in similar cases and considered by employees an accepted part of the culture. Therefore, although polices state that this is constituted misconduct, as the Company has not acted on this for other like offences, it could be reasonable to assume it is accepted behaviour and potentially unreasonable to terminate?
Another area in which companies often make costly mistakes, is not having a fair hearing with the employee. Employers must be fair and reasonable and investigate the incident and provide the employee with an opportunity to respond before dismissal.
It is essential that an employer still ensure that they have established that the employee has in fact engaged in gross misconduct, and that the employer has done the correct process to investigate and come to a decision based on fair and reasonable principle.
With the festive time of year upon us and company Christmas parties fast approaching, now is the time to ensure you that you have clearly documented and communicated policies, consistently maintained behaviour and a fair and reasonable process to investigate so that you are best placed to act on gross misconduct if and when it occurs!