The Court were bound by the requirement in the Act as to what a reasonable and fair employer “would” have done rather than what a fair and reasonable employer “could” have done. The difference between the words used in the Act is very significant. The difference allows the Court (and the Employment Relations Authority) to determine, in their mind, what was required of a fair and reasonable employer.
The practical implications from this decision are that employers would be prudent if, when considering possible outcome options for serious misconduct, they considered:
· The employee’s conduct during the investigation, including acknowledgement of any wrongdoing, admission as to the seriousness of their offending, any offer to remedy any wrong and any commitment not to repeat the complained of behaviour.
· Whether there has been a loss in trust and confidence in the employee (which must be maintained in a successful employment relationship). Things to consider around “trust and confidence” are the opinions of those above and below the person in the organizations structure/hierarchy; the persons past performance; the likelihood of reoffending; and, what they did if similar circumstances had arisen previously.
· What are the possible alternatives to dismissal and investigate whether or not they are practical. The decision indicated that employers should think laterally about alternatives and the most appropriate solutions to the circumstances before resorting to dismissal.
In the case it was revealed that the employer had predetermined the issue of suspension of the employee and that they shouldn’t have done this, as suspension was an important part of the disciplinary process and any pre determination was unfair and not what a “fair and reasonable” employer would do.
Another matter the Court found fault with was that the employer declined the offer of certain character references from relevant people who still had trust and confidence in the employee. Views of others who had a closer working relationship with the employer were valid because they had more insight into her than did the investigating officer.
The Court found that the employer had minimized the insight the employee had gained into her serious misconduct and the assurance that she wouldn’t do it again.
In the Court’s view a “fair and reasonable” employer would have taken this information into more account than was the case and would not have concluded that there was a loss of trust and confidence justifying dismissal.
Not only did the Court decide that the employer had failed to properly consider alternatives to dismissal available under its own policies they went on to say that in appropriate serious misconduct cases, temporary demotion could be justifiable even in the absence of any express provision for such a sanction in employment agreements or policies.
