Proportionality – the word that haunts employers with reinstatement orders

A major factor that repeatedly trips up employers in making decisions to dismiss employees for misconduct is proportionality – i.e. whether the punishment fits the crime.

To their peril, many employers mistakenly believe that a valid reason for dismissal and compliance with relevant processes will provide them with protection against any unfair dismissal claim.  This is not the case.

A dismissal for misconduct may be found to be harsh on the basis that the sanction of dismissal is a disproportionate penalty to the gravity of the misconduct.  All relevant circumstances need to be taken into account.

Three recent decisions of the Fair Work Commission in the last 2.5 months (here, here and here) provide stark examples of large employers tripping up on these issues.

All three cases involved findings that there were valid reasons for dismissal, being:

1. talking on a hand held phone whilst driving a heavy vehicle performing services for a local Council’s waste collection;
2. breaching the employer’s zero alcohol policy, after recording a reading of .025 in a random workplace alcohol breath test when attending for work at the beginning of the day; and
3. verbally threatening to cut a fellow employee’s throat.

In each case, the Fair Work Commission ordered reinstatement of the employee because the dismissals were found to be a disproportionate penalty to the gravity of the misconduct.

In considering all relevant circumstances, a cocktail of reasons led to the Commission’s findings across the three cases, including:

1. the lengthy service of the employee;
2. the unblemished disciplinary record of the employee over a lengthy period;
3. the misconduct not being at the more severe level of misconduct;
4. the employee’s contrition and apology;
5. the likely extreme difficulty for the employee in obtaining other employment (due to their reason for dismissal, age, etc.);
6. the significant financial and personal impact of dismissal on the employee and their family;
7. differential treatment – the employer’s approach to dealing with the employee was manifestly different to that given to other employees;
8. the employee’s medical condition of PTSD resulting in depression, anger management issues and contributing to the misconduct;
9. provocation for the conduct by a fellow employee;
10. the employer’s process – the speed with which the workplace investigation report was prepared; its significant omissions; the imbalanced approach to aspects of its contents; the perfunctory adoption and subsequent endorsements of a recommendation for dismissal;
11. the farcical show cause process (the employee’s response to the allegations was never shown to or considered by the dismissal decision maker); and
12. the X factor – the employee’s role as a union delegate and previous engagement in industrial disputes was the real reason for the employer’s strong motivation to dismiss.

Key takeaways
These decisions demonstrate that employers need to make less hasty decisions to dismiss.  Despite identifying a valid reason for dismissal, they also need to consider all relevant circumstances to ensure that dismissal is not a disproportionate penalty to the gravity of the misconduct. If it is, then a warning and/or demotion only may be warranted.

In order to minimise the risks on these issues, legal advice is recommended. If you need assistance, please contact one of our team members.