Gross or Serious Misconduct

What is gross misconduct?

Gross or serious misconduct in the workplace is a critical issue that significantly affects employment continuity. This type of behaviour often includes illegal or dangerous activities that pose a threat to individuals or the business.

Instances of serious misconduct can warrant immediate dismissal without notice or pay in lieu of notice, even for a first-time offence, if proven. Understanding what constitutes serious misconduct is essential for employers to maintain a safe and compliant workplace environment.

Fair Work regulations on gross misconduct

Under the Fair Work Regulations, serious misconduct encompasses actions that fundamentally breach the employment contract's core terms. This includes acts like theft, fraud, assault, or being intoxicated at work. Another key aspect is failing to comply with lawful and reasonable instructions that align with the employee's job role. These actions not only jeopardise the safety and well-being of individuals but can also severely damage the reputation and financial health of your business.

For Australian business owners, distinguishing between general misconduct and serious misconduct is crucial. While general misconduct might involve less severe infractions and can lead to warnings or disciplinary actions, serious misconduct can lead to immediate dismissal - also known as summary dismissal. This means an employee can be let go without notice or pay in lieu of notice due to the gravity of their actions.

Types of gross misconduct

The perception of misconduct can vary depending on the industry and company culture. What might be considered normal behaviour in one sector could be seen as unacceptable in another. This is why it's crucial for businesses to clearly outline acceptable behaviour and conduct standards in their employee handbook. These guidelines often include disciplinary procedures for breaches, providing a clear framework for both employees and employers.

Misconduct vs. gross misconduct

• General Misconduct includes actions like using inappropriate language, minor policy breaches such as lateness, or wearing inappropriate clothing. While these actions may not immediately lead to termination, repeated offences, especially after corrective actions like a written warning, could escalate to more severe consequences.
• Gross Misconduct is a more serious offence and includes behaviours that are intentionally improper and significantly breach employment standards. Gross misconduct can warrant summary dismissal – immediate termination without notice. This is reserved for severe cases where the act is intentional, significantly impacts the health and safety of individuals, or jeopardises the company's finances, reputation, or client relationships.

When considering summary dismissal, evaluate the severity and intent of the misconduct. Questions to consider include:

• Was the act done on purpose?
• Does it make the continuation of employment untenable?
• Does it pose a risk to health and safety, or harm the company's financial stability, reputation, or client relations?

As an employer contemplating dismissal for serious misconduct, it's essential to follow a structured disciplinary procedure. Ensure that the reasons for dismissal are valid and that the process leading to the decision is fair and transparent.

Examples of gross misconduct

Gross misconduct in the workplace encompasses behaviours that severely undermine company policies, safety, or integrity. Here are some examples that could lead to summary dismissal, provided the process is procedurally fair:

1. Damage to company property and vandalism are deliberate actions to cause significant damage or deface company property. This includes graffiti, tampering with machinery, and damaging the commercial property.
2. Fraud where employees engage in deceitful activities for personal gain or advantage, such as altering financial documents, personal information, or insurance details.
3. Theft including stealing company property with the intention of keeping it. This might involve taking company supplies, equipment, machinery, confidential information, or financial records.
4. Breaches of safety where wilful neglect of safety protocols, endangering oneself and others. Examples include improper handling of hazardous materials, failing to secure workplace areas, or misusing company equipment.
5. Intoxication at work includes using drugs or alcohol before or during work hours, impairing the ability to work safely or fulfil duties effectively.
6. Threats or acts of violence include exhibiting aggressive behaviours like verbal abuse towards staff or customers, physical altercations, or stalking.

Dealing with gross misconduct

When dealing with serious misconduct in the workplace, it's essential to follow a fair and structured disciplinary procedure. Here's a simplified guide for employers:

1. Investigation and possible suspension where the business should begin with a thorough investigation to establish the facts. If the alleged conduct is severe, consider suspending the employee on full pay, especially if there's a reasonable threat to people, property, or the business.
2. Notification of allegations includes writing to the employee, detailing the allegations and potential consequences if the misconduct is confirmed. Set a date and time for a disciplinary meeting, ensuring the employee is aware of the seriousness of the situation.
3. Adequate preparation time for the employee to have reasonable time to prepare for the meeting, typically at least 24-48 hours' notice. This period is crucial for ensuring fairness and allowing the employee to gather any necessary information or evidence.
4. Conducting the meeting where in the meeting, give the employee a chance to explain their side of the story and present any extenuating circumstances. After hearing their response, take time to consider or further investigate before making a decision. It’s important to determine on the balance of probabilities whether the allegations are true.
5. Deciding the outcome can vary based on the findings. These might include a written warning, a letter of concern, reprimand, no action, a final written warning, a verbal warning, or termination, depending on the severity of the misconduct.
6. Seeking further help if you're uncertain about the process or need additional advice, refer to your employee handbook or reach out to Employment Compass at 1300 144 002.

Following these steps ensures a fair and legally compliant approach to handling serious misconduct, safeguarding both the business and the rights of the employee.

Termination for gross misconduct

When terminating an employee for serious misconduct, it's crucial to minimise the risk of an unfair dismissal claim by ensuring the reason for termination is valid and the process leading up to it is procedurally fair. The Fair Work Commission considers several factors to determine if a dismissal was harsh, unjust, or unreasonable:

1. Valid reason for dismissal should relate to the employee's capacity or conduct, including its impact on the safety and welfare of others.
2. Notification of reasons where employee must be notified of the reasons for dismissal in writing.
3. Opportunity to respond as the employee should have a chance to respond to the reasons cited for their dismissal.
4. Support person during discussions where employers should consider any unreasonable refusal to allow a support person during discussions related to dismissal.
5. Impact of employer’s business means the size of the employer’s business can affect the procedures followed in the dismissal process.
6. HR expertise means the absence of dedicated HR management or expertise in the employer’s business may also impact the dismissal procedures.
7. Employee’s age and length of service are factors, including whether the employee was provoked or other extenuating circumstances, are considered.
8. Employee’s leadership position should be considered given the role and responsibilities of the employee within the company could demonstrate the impact.

If the disciplinary process substantiates the allegations against the employee, a decision can be made about termination, considering the precedent it sets for other employees. Written notification of termination must be provided, explaining the reasons and detailing any owed entitlements, like annual leave.

Employment Compass offers guidance on understanding misconduct and disciplinary procedures. For further assistance, feel free to call 1300 144 002 for free initial advice.

Frequently asked questions

Is serious misconduct the same as gross misconduct?

‍Yes, essentially. In Australia, the Fair Work Act 2009 refers to serious misconduct. This is the term commonly used and defined in legal contexts.

What Is considered misconduct?

‍Misconduct is when an employee deliberately acts against your business's policies or procedures. It's behavior that goes against what's expected in your workplace.

What happens when you suspect an employee has engaged in serious misconduct?

‍If you suspect serious misconduct, start by investigating to see if there's evidence to back up your suspicions. If there is, begin a fair disciplinary process: suspend the employee on full pay, inform them of the allegations in writing, set a meeting, give them time to prepare, discuss the allegations in the meeting, investigate further if needed, and decide on an outcome.

What are examples of serious misconduct?

‍Serious misconduct includes theft, fraud, assault, being intoxicated at work, or not following lawful and reasonable instructions as per the employee’s contract.

What is a reasonable excuse?

‍It varies. For instance, in a fight at work, consider if the employee was provoked, their employment duration, past behaviour, and whether they hold a leadership role.

What constitutes procedural fairness?

‍Procedural fairness is about the fairness of the dismissal process. This involves standing the employee down on pay if needed, writing to them about the allegations, holding a meeting after giving them time to prepare, considering their response, and deciding if the allegations are more likely true than not. Then, decide on an appropriate response and communicate this to the employee.

Does serious misconduct always end in dismissal?

‍Not always. Dismissal might not be necessary if there are extenuating circumstances that explain or mitigate the misconduct.

Can you fire en employee for off-duty conduct?

‍Yes, if their off-duty conduct is significantly connected to your business and its activities.

Can an employer regulate your off-duty behaviour?

‍To an extent, yes. Employers can set standards for behaviour outside of work, like not wearing the company uniform inappropriately or posting negative comments online. Breaching these can lead to disciplinary action.