Caught in the act

first_img Comments are closed. Don’t get caught out when disciplining for theft.  Sue Nickson looks at the correct procedures to follow to ensure asatisfactory outcomeBreach of contractSarah has worked at the hotel as a cleaner for the past six months.During this time some money has gone missing but no disciplinary action hasbeen taken against her. She has now been told she has not passed theprobationary period because of these incidents. She has claimed that the hotelshould have followed procedure set out in the disciplinary policy. Sue Nickson comments: If there is a contractual disciplinaryprocedure then the employee will be able to claim that a failure to follow itis a breach of contract. Many employers will be able to avoid the potential forthis type of claim by expressly providing in the contract that the disciplinaryprocedures are excluded during the probationary period. However, the employer’s right to exclude such provisions will be affected bydraft legislation that is going through Parliament. When the provisions of theEmployment Bill 2002 are implemented all employers will be required to have acontractual disciplinary procedure. This will mean that at the very least theemployer will have to put the allegations in writing to the employee, hold adisciplinary hearing at which the employee will be able to make representationsand provide for a right of appeal. A recent decision of the Court of Session in the case of King v Universityof St Andrews, 2002, IRLR 252 has confirmed the fact that during aninvestigation and disciplinary process the implied term of mutual trust andconfidence still applies. It is only later when a decision to dismiss hasactually been made that the term will not be implied in the contract ofemployment. This is likely to widen the scope for employees to be able to bring a claimfor breach of contract should the employer fail to comply with the spirit ofthe contractual disciplinary procedures. EmbezzlementBill has worked as the manager at the Bates Hotel Hi Class Restaurantfor the past 18 months. A recent audit has revealed a number of discrepanciesin relation to the stock and cash records. Bill is called into a meeting andadmits that he paid sale proceeds into his own bank account. However, he hadalways intended to purchase replacement stock with this money. He is summarilydismissed. SN comments: The reaction of most employers would be that theemployee who admits taking company funds and paying them into his private bankaccount could be summarily dismissed. However, take care to consider whether afull and fair process has been followed. Here the employer does not appear tohave carried out an investigation beyond establishing that the monies were paidinto the employee’s bank account. In the recent case of OHR v Possante, the Employment Appeal Tribunal foundthere had been a failure to investigate adequately in very similarcircumstances. Possante had been a restaurant manager and in charge of winestocks. A stock check found 45 bottles of wine were missing. His explanationwas that the bottles had been sold and the proceeds placed into his own bankaccount ready for him to buy replacements. He was summarily dismissed despitehis explanation and the fact that the hotel manager confirmed this practice hadbeen followed for the previous 18 months. The dismissal was ruled to be unfairbecause of the employer’s failure to investigate further. There may have beenrecords to substantiate the fact he had purchased replacement bottles over aperiod of time or grounds to support his claim that there were security issuesin the hotel. In 1988 the House of Lords ruled in the case of Polkey v AE Dayton Services,1988, ICR 142, that the dismissal of an employee without following a properprocedure was unfair. Before this decision, a tribunal may have found adismissal in such circumstances fair if satisfied that the employee would havebeen dismissed even if a full procedure had been followed. The judgement allowedfor only the limited exception that dismissal procedures could reasonably bedispensed with where the offence is so heinous that a reasonable employerfollowing good employment practice could conclude that no explanation ormitigation would possibly make any difference to the decision to dismiss. However, a partial reversal of this rule could result from the provisions ofthe Employment Bill 2002 when it comes into force. An employee will notnecessarily be dismissed unfairly even when the employer has not followed thefull contractual disciplinary procedure. While the employer will still have tofollow the statutory procedure the tribunal may find that it made no differenceto the end result and the dismissal may be found to be fair. Protected disclosureAndrew was recently employed as a security guard at the hotel. He hadplaced a large sum of money that had been left in one of the rooms in the hotelsafe. He told the head of security who told him that he would sort it out. Aweek later Andrew found that the money was missing and he contacted the generalmanager about its disappearance. He was then dismissed on the grounds that hewas making trouble about the missing money. SN comments: Generally an employee needs to have one year’s serviceto bring a claim for unfair dismissal. Here no procedures have been followedbefore the dismissal and there do not appear to be any fair grounds for thedismissal. It appears to be an unfair dismissal but as Andrew has less than oneyear’s service he will not be able to bring a claim. However, Andrew may be able to take advantage of one of the exceptions tothe qualifying service requirement. Most of the exceptions relate to instances where an employee has beendismissed for a reason connected with asserting a statutory right. But the PublicInterest Disclosure Act 1998, as implemented by section 47 of the EmploymentRights Act 1996, gives protection to employees who have made a protecteddisclosure. The fact that Andrew reported to his employer that monies had gone missingwould appear to amount to a protected disclosure as it concerned what hebelieved was a criminal offence – theft. Under the whistleblowing provisions, the employee is not required to have ayear’s service in order to bring a claim of unfair dismissal. Probably of evenmore concern to the employer is the fact that any compensation for unfairdismissal will not be subject to the usual cap, which at present stands at£52,600. This could prove financially disastrous for a company as wasillustrated in a recent case where the employment tribunal found that thedismissed employee was nearing retirement age and was, therefore, unlikely tofind suitable employment again; on this basis it awarded the employee £293,000as compensation to take into account losses up to the date of retirement. Even if Andrew’s case was not a whistleblowing case, the employer might bein breach of contract by failing to follow the disciplinary procedures if theseare contractual (see Sarah’s case above). Unfair dismissalJim has worked in the hotel as a receptionist for several years. Anew head receptionist has complained to the general manager that some of theroom bills are not being processed in the correct way. Jim has already had awarning about the bills procedures and at a subsequent disciplinary hearing, afteradmitting that he was still following the old procedures, the head receptionistdismisses him. SN comments: Is the employer at risk of a claim? The allegations havebeen put to Jim and he has admitted the conduct complained of by the headreceptionist. To be fair the decision to dismiss must be within the range of reasonableresponses and as Jim has a previous warning for the same conduct it wouldappear to be so. However, in the case of Whitbread (t/a Whitbread Medway Inns) v Hall, 2001,ICR 699, a hotel manager was dismissed after admitting that he had guessedfigures for a stock control audit. He had previously had warnings about dealingwith stock control and was dismissed by his immediate manager. The EAT found the dismissal was within the range of reasonable responses,but the employer’s disciplinary process was so flawed that it rendered thedismissal unfair. A fair dismissal procedure was essential even where theemployee admitted misconduct. Here, the procedure followed before Jim’s dismissal appears to be flawed.The head receptionist not only conducts the disciplinary hearing as theemployee’s immediate supervisor but is also the person who initiated the investigation.This could be criticised on the grounds that he acted as both judge and juryin the complaint. Unless the firm can show it had such limited resources itcould only deal with the complaint in this way, the resulting dismissal will befound to be unfair. Sue Nickson is partner and national head of employment law at HammondSuddards Edge Previous Article Next Article Caught in the actOn 1 Jun 2002 in Personnel Today Related posts:No related photos.last_img

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