The recent publicity around the off-field behaviour of rugby players has highlighted the challenges employers face when dealing with employee misconduct. This issue can be especially problematic when the conduct amounts to criminal conduct and criminal proceedings are operating in parallel with an employer’s investigation. In this scenario, there is an inevitable conflict between the employment law duty of good faith (which requires parties to be “responsive and communicative”) and the criminal law right to silence.
Two cases illustrate the critical nature of the timing and quality of an employer’s investigation. The first case concerned a bus driver, employed by Ritchies. One of the driver’s passengers made a complaint of sexual assault against him. The Employment Court held that the decision to dismiss the bus driver was unjustified.
Before the employer’s investigation was completed, a criminal jury trial took place and the driver was acquitted of a charge of indecent assault. During the criminal process, the employer suspended the driver without pay. Following the acquittal, the employer resumed its investigation, and summarily dismissed the driver a few months later.
The Employment Court held that the dismissal was unjustified because the employer had a predetermined view that serious misconduct had occurred and its belief that the indecent assault had occurred was based on a series of unsafe assumptions. Indicators of a predetermined view regarding misconduct included a statement from the employer’s human resources manager that “if the Police have gone through due process when they have charged somebody then I will come back to the whole thing that where there is smoke there is fire.”
The Court considered that it was unsafe for the employer to assume that serious misconduct had occurred merely because (1) police decided to lay charges against the driver and, (2) the driver chose to not give evidence at the criminal trial. Accordingly the Court described the disciplinary process as fundamentally flawed for predetermination.
The Court added that an employer had to satisfy the Court on the balance of probabilities, and as a result of a complete and fairly conducted enquiry, it was justified in believing that serious misconduct had occurred. The decision to dismiss had to be based on a “reasonably founded belief”. Where there were indicators of predetermination, that belief could not be viewed as “reasonably founded”.
On the other side of the line is a case concerning a high profile senior investment analyst. The analyst was involved in an altercation with another motorist while driving and ran over the other motorist while departing the scene. The police charged him with causing grievous bodily harm with reckless disregard. The employer advised the analyst that he was entitled to the presumption of innocence and that any judgment on the part of the employer would be reserved pending outcome of the criminal process.
The analyst was found guilty of the charge. At sentencing, the Judge noted the analyst’s good character and observed that it would be extremely unfortunate and unfair if he were to lose his employment as a result of the conviction. Immediately following the criminal process, the employer resumed its investigation and decided to dismiss the analyst for serious misconduct.
The employer’s decision to dismiss was upheld by the Court. In doing so, the Court helpfully summarised the relevant principles:
- Conduct that occurs outside the workplace can give rise to disciplinary action.
- Out of work conduct need not meet a higher standard of seriousness than conduct in the workplace.
- The focus of the enquiry was the impact of the conduct on the employer’s business.
- The employer did not need to show actual damage to its reputation or goodwill because this would prevent employers from taking pre-emptive action.
These cases demonstrate that a criminal proceeding need not derail an employment investigation. However, an employer must make its own enquiries, keep an open mind and consider an employee’s views prior to taking any disciplinary action. As a specialist court, the Employment Court will focus its attention on the fairness and reasonableness of the disciplinary process in order to determine whether the employer’s actions are “what a fair and reasonable employer could have done in all the circumstances”
If you would like any further information or advice about any employment matters, please contact Carolyn Heaton at firstname.lastname@example.org or on (04) 495 8908 or John Goddard at email@example.com or on (04) 495 8932.