Termination for serious misconduct undermined by flawed investigation

Termination for serious misconduct undermined by flawed investigation

It is imperative that employers who suspect employees of misconduct thoroughly conduct an investigation into the employees’ alleged misbehaviours. Failure to do so is likely to result in a terminated employee being reinstated or being awarded financial compensation for their dismissal.

The situation was recently highlighted in the case of a recruitment consultant engaged by Blugibbon Pty Ltd (Blugibbon), a medical recruitment agency that engages and places medical practitioners in locum and other short-term roles in local districts private hospitals and with the Commonwealth Department of Home Affairs. The agency collects various documentation and information from its clients, including CVs, identity documents, insurance policies and visa information.

In early 2021, an employee ‘SG’ was given a verbal warning about his performance and conduct. The employee had a work laptop with access to all of Blugibbon’s shared computer drives, as did the rest of the businesses’ 1000 employees. Shortly after the warning was given, SG informed the company that he had a medical condition and would be unfit for work for a seven-day period. Ultimately, the condition led to him being absent on sick leave for the remainder of the month.

Unfortunately, a Blugibbon director immediately formed the view that SG was planning to leave the business and that his access to company information posed a threat to the business.

Around midday on 28 April 2021, while SG was still absent on leave, the director received a report of abnormal download activities on SG’s laptop. Assuming SG was using the laptop for unlawful purposes, he retrieved the laptop, performed some preliminary searches, and contacted SG the following morning to dismiss him for engaging in ‘serious misconduct’.

According to Deputy President Easton, Blugibbon’s hasty actions were motivated by a desire to take separate action against SG in the NSW Supreme Court. Regardless of their motivation, the process was procedurally unfair, with the Deputy President noting, “nobody took time to properly investigate (SG’s) activities before dismissing him and (SG) was not afforded procedural fairness in any way”.

The Deputy President was also critical of the vagueness provided to SG in the termination letters forwarded to him. He summarised the reasons given for dismissal as:

(a)    There was log in and data download activity as SG’s laptop while he was on sick leave; and

(b)    SG deleted a G-drive virtual disc drive from the laptop and also the recycling bin of the laptop.

The Deputy President accepted SG’s submissions that he had simply accessed the laptop to track his recruitment activities against budget and to view several of the businesses employment policies. Further, he accepted SG’s submission that he had deleted the G-drive to remove personal files that he had stored on the laptop.

The Deputy President also dismissed a report Blugibbon provided that had been undertaken by an external cyber expert after SG was terminated, noting that it simply quantified the director’s suspicions but did not actually establish any wrongdoing by SG.

In determining the dismissal to be invalid, the Deputy President noted, “Blugibbon had little more than suspicion of foul play and decided to dismiss (SG) based on those suspicions rather than find out if the suspicions were true. Understood in this way, Blugibbon’s under investigated suspicion was not a valid reason for dismissal”.

SG did not seek reinstatement as he had secured alternate employment three weeks after his termination.

Deputy President Easton awarded him compensation in the amount of $9,050.

SG v Blugibbon Pty Ltd (U2021/4290) 15 October 2021

[2021] FWC 6143

For questions about misconduct, investigating allegations, procedural fairness, or other employment questions, please contact Dean Cameron at Workforce Advisory Lawyers – We Know Employment Law on 1300 925 529, 0417 622 178 or via email to dean.cameron@workforceadvisory.com.au

Disclaimer: This information is provided as general advice on workplace relations and employment law. It does not constitute legal advice, and it is always advisable to seek further information regarding specific workplace issues. Liability limited by a scheme approved under professional standards legislation.

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