Employee dismissed on the spot with payment in lieu of notice withheld … Authority determines Employer justified …

In a recent Employment Relations Authority decision, the Authority considered the following scenario: records showed anomalies in product orders and the stock on-site; the employer approached the employee making the orders; the employee acknowledged that he had made the orders and that he had taken some products home; the employer reported suspected theft to the police, and dismissed the employee on the spot.  The employer then withheld payment in lieu of notice, which the employee made a claim to the Authority for.

All of the police charges were eventually dropped or were unsuccessful.  The Authority however thought that, although the employee had not committed the crime of theft and had not intended to steal from the employer, it was not surprising that the employer concluded that the employee was stealing.

The Authority found that the conduct of the employee had fundamentally breached his duty of trust and confidence to his employer, and that the employer was therefore justified in dismissing the employee on the spot.

The Authority concluded that the employer was entitled to treat the contract as at an end and consequently withhold payment in lieu of notice that would otherwise have become due under the contract.

Employers should always take care when taking disciplinary action against employees.  It is on few occasions that alleged employee misconduct will be so severe as to justify dismissal on the spot.

In most cases employers are required by law to provide the employee adequate time and opportunity to seek advice and provide comment on any allegation.  It is also not common for an employee to lose a contractual right such as a notice period.

If you have concerns about the conduct of your employees or need assistance handling a disciplinary process, feel free to call me on (04) 473 6850.