Gross misconduct clause must be clearly defined

Employers need to ensure staff understand their employment contracts, as
sacking an employee for gross misconduct has recently been the subject of
debate

Gross misconduct should be relatively straightforward. An employment
contract usually defines what is acceptable behaviour in the workplace and employees
abide by that. To commit an act of gross misconduct is to breach that contract,
and is therefore a sackable offence. Simple!

However, recently this area has been the subject of debate, most notably in
a case where we acted for the claimant – a sacked managing director, referred
to as Mr X.

The High Court found in favour of Mr X in his claim for breach of contract
against the company, Y plc, which had sacked him for gross misconduct over
unauthorised absence from the office and not working normal hours.

However, Mr X was cleared of misconduct for carrying out much of his work
from 1993 to 2001 in clubs, cafes and while walking in the park when he was
dismissed.

The court found that Mr X had reasonably believed that his style of working
was accepted by his employer.

Gross misconduct has to be clearly defined and then proved. It cannot be
retrospectively defined, but any contract can have broad scope by referring to
‘any act of a similar nature considered gross misconduct’ by the company’s
management.

Nevertheless, a tribunal could disagree with such an assessment and find in
favour of a potential claimant on such grounds. Some examples are clear cut:
stealing, violent aggression, criminal prosecution. Others can be tricky if an
employer has been less than rigorous in monitoring or illustrating expectations
and results.

But gross misconduct is a very serious reason for dismissal. In many cases,
it is seen as the most effective way of getting rid of a key employee,
particularly if that employee’s contract has certain stipulations in their
favour that would be rendered null and void on gross misconduct grounds.
Clauses such as a notice period pay-off or an equity settlement are frequently
disputed.

Some employers will go to great lengths to prove misconduct in the first
place. A private detective could be brought in to dig for dirt, and that can
bring problems. This could be a clear invasion of privacy, and the allegations
could be construed as spurious, or even slanderous. To go so far is a risk, and
any employer would have to be sure of how calculated it is.

The lesson to employers is that if certain behaviour is allowed to continue,
even when contrary to workplace regulations or contractual obligations, it is
consented to by implication.

If an employer does object or enforce any regulation (via the disciplinary
procedure), it has to be done properly and the employee given time to adjust.
Otherwise, an unfair dismissal claim could be in the offing.

An employer’s silence on workplace behaviour that is not true to established
procedure effectively waives the right to enforce those regulations, and
invalidates any potential action on gross misconduct grounds.

Most employers appreciate that executives can put in significant amounts of
time, which they are neither contracted nor obliged to do.

Travelling time, particularly abroad, is a prime example. Most employees
exercise discretion and an hour in the gym mid-afternoon when no lunch break
has been taken is a standard illustration of time management when it comes to
balancing the personal side of life with the professional.

Both employers and employees should nevertheless be aware of either side’s
position, and just how thin the line is when they come close to crossing it.

By Alain Cohen, director, Ashby Cohen Solicitors

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