Managing conduct issues in the workplace04 Aug 2011
This briefing discusses the management of conduct issues in the workplace. It sets out how the Jersey Employment Tribunal (the "Tribunal") has approached misconduct dismissals, and is accompanied by a summary of the procedure to be followed by employers when managing conduct in the workplace.
The Tribunal was established in 2005. Since then, a significant proportion of the claims heard have concerned unfair dismissal, including dismissal on grounds of misconduct. Reasons for dismissal on misconduct grounds put forward by employers have included:
- insubordination at work (Curtis v Baccata Trustees (2009));
- falsifying records (Edwards v Barclays Private Clients International Limited (2009));
- performing an illegal manoeuvre during take-off (Groothuizen v Flybe Ltd (2009));
- bullying in the workplace (Osbourne v Spellbound Holdings Limited (2009)); and
- poor attendance and time-keeping (Browning v C.I Fire & Security Ltd (2007)).
Many employers fail to defend successfully unfair dismissal claims at the Tribunal. An essential element of the dismissal process is the use of a fair procedure by the employer to justify reliance on conduct as a fair reason for dismissing the employee.
The law: misconduct and unfair dismissal
In order for a dismissal to be fair, the employer must satisfy a two stage test:
- there must have been a potentially fair reason for the dismissal; and
- the employer must have followed a fair dismissal procedure in all the circumstances.
Dismissal for a potentially fair reason
There are a limited number of grounds on which an employer may rely in order to justify dismissing an employee under the Employment (Jersey) Law 2003 (the "Law"). One potentially fair reason is "conduct" (Article 64(2)(b) of the Law).
Fair dismissal procedure
Once it has been established that the dismissal was for a potentially fair reason, in accordance with Article 64(4) of the Law, the Tribunal will consider:
"...whether in the circumstances (including the size and administrative resources of the employer's undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee."
Tribunal guidance on fairness of dismissal
In the case of Brennan v Family Nursing & Home Care (2005), the Tribunal made the distinction between poor conduct and other questionable behaviour, such as a lack of ability on the part of an employee to do the job he or she was employed to do. Citing the UK case of Southern and Gates (Luton) Ltd v Boxhall 1979 ICR 67, the Tribunal noted that:
"…where someone fails to come up to standard through his or her own carelessness, negligence or idleness, that is not incapability but misconduct".
The Tribunal gave guidance on the extent to which employers may need to prove that the employee's behaviour constitutes misconduct. It held:
"When dealing with cases involving…misconduct, the employer only has to show that it genuinely believed on reasonable grounds that the employee was…guilty of misconduct. This belief is generally established over a period of time but can be shown by a single act…"
The Tribunal in Brennan further explained, with reference to the UK case British Home Stores Ltd v Burchall 1980 ICR 303, the three-fold test to be applied to establish that a dismissal was on misconduct grounds. The employer must show that.
- it believed the employee was guilty of misconduct;
- it had in its own mind reasonable grounds to sustain that belief; and
- at the time it formed that belief it had carried out as much investigation into the matter as was reasonable in the circumstances.
In Maina v Empire Catering Limited (2006), the employer sought to rely on the employee's misconduct and poor performance as reasons for his dismissal. Maina was a café worker from Kenya who had been employed as a seasonal worker. The Tribunal explained that there was "plenty of evidence that Mr Maina's work was unsatisfactory", but questioned the employer's procedures. It explained that businesses should:
"… take what amounts to gradual steps towards dismissal, ensuring that the employee understands where his performance/conduct is insufficient, and giving him a chance to change. The employee must understand the consequences of not improving."
Summary of procedure
Given the requirements of the Law and the findings of the Tribunal, it is essential that employers follow a careful and fair procedure when seeking to dismiss an employee on grounds of misconduct. Each situation is different and it is recommended that legal advice is obtained before taking any action which could lead to the dismissal of an employee. The following steps should always be considered:
Review your procedures
The first port of call should be your own disciplinary procedure. Read this and make sure that all relevant steps are being followed. Any action taken by the business in breach of the terms of the contract of employment (the "Contract") could give rise to a future breach of contract claim and/or a claim by the employee that the process followed was unfair. Any person involved in an investigation of alleged misconduct must be aware of and follow the relevant parts of the Contract, including codes and policies, which may be set out in a Handbook, internal IT networks or elsewhere. If the business procedures have not been followed, you may still be able to rectify things by making sure that you go forward in line with your procedures from the earliest possible point.
Obtain guidance/discuss with an independent colleague or adviser
Where the employer has a designated HR officer, he or she should be notified at the earliest opportunity. Specialist legal advice may often also be helpful, particularly in cases where:
- penalties, such as a final written warning or dismissal, are being considered;
- the employee in question is senior; or
- there are risks to the business in terms of reputational damage, for example.
As well as the guidance and knowledge that such a person will be able to dispense, advice from a third party, in confidence, will provide reassurance to the person charged with addressing the matter that they are not doing so alone.
In cases where the misconduct in question is serious (including, for example, allegations of fraud) or where keeping the employee within the business during the investigation could pose risks for the business, an employer should consider suspending the employee.
If the business is to consider suspension, it must first review the Contract. If there is no express contractual right to suspend, then any suspension could be in breach of contract. This may give rise to issues such as constructive dismissal and the potential invalidation of key contractual terms, for example, restrictive covenants.
Any suspension must be managed. The employee must be informed of the reason for the suspension and must be kept up-to-date about the progress of the investigation and workplace issues (including reorganisations and redundancy) whilst he or she is away. The suspension must not be allowed to continue indefinitely as this could give rise to a claim for constructive dismissal.
Suspension should be with pay unless (i) there are wholly unusual and exceptional circumstances; and (ii) there is an express contractual provision enabling the employer to withhold pay.
The person responsible for investigating the allegations must try to ascertain the basic facts of the matter at the earliest opportunity.
In Pereira v Sandpiper CI Limited t/a Cimandis (2009), Pereira worked as a delivery driver. He was dismissed for misconduct in relation to several incidents that occurred whilst on a final written warning. Although the Tribunal held the claimant had not been unfairly dismissed, it criticised the respondent's failure to investigate adequately one of the allegations made against Pereira:
"The Tribunal accepts the Respondent's submission that it would not wish to inconvenience the complaining customer but it cannot understand why, for example, Mr Wright did not pay the owner of the shop a visit, just to asses the situation for himself…In this case, the Respondent was not interested in the other side of this particular complaint."
If new information comes to light during the initial investigation, which indicates that the matter may be more serious than had previously been understood to be the case, the employer may again have to consider suspension.
Investigation: independent officers and obtaining evidence
In an ideal world, those involved with the investigation, any subsequent disciplinary hearing and any appeal will be independent and neutral. (The degree to which this is possible may depend to a great extent on the size of the business in question). This means that those who investigate the allegations (the Investigating Officer), hear any disciplinary (the Deciding Officer) and chair any subsequent appeal (the Appeal Officer) should not have been involved at any prior stage.
Often, however, the employee's line manager or someone else in the line management chain will carry out the investigation. This should be acceptable as long as the Deciding Officer (and Appeal Officer, where applicable) can be shown to be independent. In some cases, it may be possible to ask neutral third parties to take a role in the procedure.
Hard copy documents
The business may need to:
- recover relevant files and paperwork;
- ensure that documents are kept in a logical, manageable order and that original documents are not altered or marked;
- where copies of the documents are sent to third parties (for example, legal advisers, the police, the employee) the business must ensure that it keeps a careful record of the materials that have been sent;
- if the misconduct involves abuse of internal process (compliance, finance, IT procedures), it is important to consider how to ensure that the evidence can be understood by a third party who may not be familiar with the business; and
- the Investigating Officer should not assume that documentation relating to the employee from the line manager constitutes the entirety of the relevant paperwork without checking this.
Obtaining oral evidence from employees (including the employee under investigation)
Evidence should be recorded in writing (by means of minutes of meetings or a witness statement). Minutes of meetings should be kept in any event and they should:
- record the name of the note-taker;
- be signed by the person chairing the meeting; and
- ideally, they will also be signed by the employee to confirm that the minutes are a true record of matters discussed at the meeting.
Witnesses should not be given guarantees that their evidence will be kept confidential, even though in some cases staff will be reluctant to give evidence. This is because such assurances may impact upon the use of such statements in subsequent tribunal and court proceedings.
Instead, employers should explain that the statement is being taken for use in an internal investigation and should try to answer factually any question the interviewee may have. This will need to be done without disclosing sensitive information about others, wherever possible.
In the case of Osbourne v Spellbound Holdings Limited (2009), allegations relating to the claimant's misconduct were assessed by an external investigator instructed by the respondent. A total of 19 people were interviewed. In her report, the investigator explained:
"I have written notes of each interview but as I gave assurances that their statements would remain confidential for the purposes of this report I am giving overall feedback…."
The Tribunal noted that cases of alleged bullying are difficult for employers, which may have to balance competing duties to the victims, the potential witnesses and the alleged bully. However, in this case, the Tribunal found the claimant to have been unfairly dismissed because of the way in which the investigation had presented the anonymised evidence gathered. The Tribunal held:
"Mr Osbourne had a right to a fair hearing. One of the essentials for a fair hearing is that a person knows the allegations against him and has a fair opportunity to answer them…he could not explain that the witnesses, or some of them, had no genuine reason for fear, for he did not know who expressed fear…Mr Osbourne could not meet that allegation without knowing who the alleged victim was."
Raise the issues with the individual: meeting with the employee
Any issues must be raised with the employee before any action is taken. This must be done in a clear and open way. Normally, this will involve a meeting with the individual before any action can be taken, although a formal meeting may not always be required for minor breaches (see below).
In the case of Mozdzen v Sarum Hotel Limited (2009), the claimant failed to return to work on an agreed date following annual leave. During her holiday leave, Mozdzen sent a text message to her manager informing her that she intended to extend her stay in Poland. The Respondent replied explaining that, if the claimant did not confine her holiday to the agreed dates, disciplinary action would be taken. The claimant did not respond. The respondent informed Mozdzen that a disciplinary hearing had been scheduled for a date immediately after the claimant's original return date. As this date was prior to the claimant's extended return date the hearing took place without her. The Tribunal held:
"…it was not fair or reasonable to hold the disciplinary hearing on a date when the Respondent knew that Miss Mozdzen was not going to be in Jersey…a disciplinary hearing should allow the employee to make his/her case, and to fix it at a time when the employee cannot appear is not, as we say, fair or reasonable."
However, the Tribunal did not find the claimant to have been unfairly dismissed. It held that the Respondent had informed the claimant of her right of appeal (under which she would have had an opportunity to challenge the fairness of the disciplinary procedure) but she chose not to. This "lost opportunity through her own decision or fault" influenced the Tribunal's decision.
The employee should be made aware of the disciplinary procedure and his or her rights under it. Some of those rights are discussed below:
- Minor breaches
In the event that the misconduct constitutes a minor breach, the employee should be given a warning about his or her misconduct. This may be given orally and recorded in writing or it may be given in writing.
- Other misconduct
If the issue is more serious, following a meeting with the employee, a written warning may be issued. This will set out the likely consequences of further misconduct.
The written warning should:
- confirm the reason for the warning;
- advise the employee that this is the first stage of the disciplinary procedure (if applicable);
- confirm how long the warning will remain on file (for example, 6-12 months, depending on the employer's disciplinary procedure);
- inform the employee of any changes that need to take place;
- confirm the consequences of further misconduct (for example, a final written warning, demotion or dismissal); and
- inform the employee of his/her right of appeal.
The employer should make a note of the meeting and place it on file.
- Subsequent warnings, including final warnings
If the employee's behaviour does not improve, it may be necessary to move to the next stage of the procedure.
The employee will be asked to attend a meeting and advised that it may result in a (further) written warning or final written warning. The employer should make a note of the meeting and the warning and place it on file.
If it is found that the employee is at fault the information set out below should be provided in writing (for example, in a letter following the recent meeting).
The same requirements will apply to this written warning as above. The fact that any further misconduct may lead to dismissal should be clearly stated.
- Dismissal or action short of dismissal
If the employee's conduct continues to be below the standard expected by the employer, further disciplinary action may be taken. However, employers must apply caution in relation to previous warnings. If the relevant time has elapsed, so that any previous warnings are now "spent", they should not be taken into consideration in subsequent disciplinary proceedings.
Where further disciplinary action is required, the employee should be asked to attend a meeting. The employee should be advised at the time he or she is asked to attend the meeting that the outcome could be dismissal although no final decisions have been taken.
The employer should make notes of the meeting, the outcome and the reasons for the decision and place the notes on file.
If, following the meeting and consideration of all the evidence, it is determined that the employee is at fault, the following should be explained to him or her in writing:
- the reason for the dismissal (or other disciplinary action such as demotion);
- that this is the final stage of the disciplinary procedure;
- if dismissed, the amount of notice to be given and the last date of employment;
- whether notice is to be worked or paid in lieu; and
- that he or she has a right of appeal.
The disciplinary procedure should provide a right of appeal, with any appeal to be lodged and heard within a specified time frame. The employee should state the reasons for the appeal. The employer must hear the appeal at the earliest opportunity and decide the case as impartially as possible, confirming the outcome in writing. Where possible, the appeal should be heard by a person other than the person who made the initial disciplinary decision.