Legal Factors
All employees owe their employer a duty to work honestly and faithfully in carrying out their responsibilities. Any breach of this duty to work honestly and faithfully will put the employee concerned in breach of contract and render him/her liable to dismissal.
Unlawful activities by employees can constitute grounds for dismissal. For example, legislation outlaws offences such as theft as a servant, misappropriation of property, embezzlement, fraud, vandalism, unlawful discrimination, sexual harassment, safety breaches, use of illegal drugs at work, and so on.
Policy
You should vigorously investigate any suspicions of dishonesty or unlawful activities by employees at any level. Employees found to be in breach of the our policies or Code of Conduct in relation to unlawful activities or dishonesty should face the real likelihood of dismissal.
You may involve the Police in matters concerning breaches of the criminal law such as dishonesty, illegal drugs, assault and intimidation. The Police will conduct any investigation they deem necessary with the full co-operation of the Company. Where the Police are involved, it is imperative that you also continue to conduct your own investigation of the matter. This is necessary to ensure that the necessary employment law considerations are dealt with separately from the criminal law aspects.
Any decision to involve the Police may complicate matters from an employment law viewpoint. Under employment law all employees have a duty to account which means they must answer your questions concerning allegations of wrong-doing that are in breach of our policies or Code of Conduct. However, once put into the Police jurisdiction, employees have a right to remain silent and can lawfully refuse to answer any questions on the grounds that it may incriminate them. Therefore it is strongly recommended that no such matter is referred to the Police until you are satisfied that a Police investigation is more appropriate than an in-house process. Once the matter has been put into the hands of the Police, your ability to follow through with disciplinary action may be delayed until the Police case is resolved, which may take many months.
Note: Because of these potential complications, it is often best practice to resolve the employment issue first (with a thorough in-house procedure) before deciding whether or not to refer it to the Police.
The major point to remember is that even if criminal charges are not initiated, fail, or are eventually dropped, a dismissal for dishonesty will still be valid if it is soundly based and properly carried out in terms of employment law.
Criminal Law vs Employment Law
In cases involving alleged “stealing or fraud”, a criminal conviction will only result if it is proven beyond reasonable doubt that the individual was guilty of the crime of “fraud", "theft” or “theft as a servant” under statute law.
However, the decision to be made in employment law is entirely different and is concerned with the question of whether the actions of the employer were justified, not whether the employee committed any criminal offence. For this reason you should not accuse an employee of theft as such, but instead make an allegation of “unauthorised possession of company property or the property of another person”. As noted above, it is for this reason it is usually prudent to conduct an in-house process to resolve any employment issues before placing the matter in the hands of the Police.
The employment law position on dishonesty is that the proper use of an employer’s property is part of an employee’s general duty of faithful service, which is an implied part of every employee’s contract of employment.
It is the employee’s duty to take proper care of such property of the Company as is entrusted to his/her care, or to which he/she has access by virtue of his/her employment.
It is misconduct for an employee, without permission, to take for his/her own use the property of the Company. It is misconduct because it is a breach of the implied term in the employee’s contract of employment. In this sense “property” means anything belonging to the Company including goods, equipment, supplies, parts, stationery, intellectual property, cash and so on.
Importantly, the Company does not have to prove criminal intent in order to justify a dismissal for dishonesty, but must be able to show that “on the balance of probabilities, in all the circumstances the dismissal was justified”.
Follow the Dishonesty and Unlawful Activity flowchart for a guide to handling these issues.
Back to Specific Types of Misconduct