How can employers prove employee misconduct? | HR blog

How can employers prove employee misconduct if required to in an Employment Tribunal? Paul Chamberlain, Head of JMW's Employment team, outlines how businesses can identify and document misconduct to prove a dismissal has been fair, though specific professional advice should be sought in each case.

The dismissal of an employee for a reason which "relates to the conduct of the employee" is potentially fair, according to section 98(2)(b) of the Employment Rights Act 1996 (ERA 1996).

What is misconduct?

Misconduct could include actions such as:

• Refusal to obey instructions
• Misuse of computers
• Abuse of sick leave
• Failure to disclose relevant information

And also, more serious actions, such as:

• Gross negligence
• Fighting
• Dishonesty, theft, and fraud
• Bribery
• Abuse of drugs and alcohol

Although the language in the statute makes this clear, the Court of Session in CJD v Royal Bank of Scotland confirmed that the conduct in question does not need to be "reprehensible". The Employment Appeal Tribunal also confirmed in JP Morgan Securities Plc v Ktorza that the conduct does not need to be "culpable".

Examples of what your company deems to be misconduct and/or gross misconduct should be detailed within your disciplinary procedure.

Dismissing an employee for misconduct

It is your job, as the employer, to show that conduct was the reason for dismissal. For the purposes of establishing the reason for dismissal, you only need to have a genuine belief in the employee's misconduct; the belief does not have to be correct or justified.

Sometimes, it may be difficult to decide which of the statutory reasons applies to the employee's actions. For example, in cases of negligence, it may be possible to characterise the reason as capability or conduct. It is unlikely that you would be penalised by the Employment Tribunal for applying the incorrect label, as long as:

• You make it clear to the employee what the allegation is (as the employee must be sufficiently informed to be able to put their side of the story), and
• The matter is investigated appropriately

The importance of documenting misconduct

All disciplinary proceedings should be documented. The records that you keep should include, among other things:

• Details of the allegation or allegations
• Details of the investigation, the investigation outcome and recommendations regarding whether formal disciplinary proceedings should follow
• Copies of correspondence sent to the employee, along with all accompanying documents (such as witness statements)
• Notes from the disciplinary hearing, the disciplinary outcome letter and details of any sanction imposed
• Notes from any appeal hearing and the appeal outcome letter
• As far as possible, the reasons for decisions taken at various stages. For example, an employer may subsequently be required to justify the choice of investigator or chairperson of the disciplinary hearing, or why, following the investigation, it was decided that disciplinary proceedings were warranted

It is important to produce detailed notes, as this will make it easier to recollect events and decisions taken at the time. You should ensure that all records are clear and concise, bearing in mind that it may be necessary not only to refer to them, but also to produce them during the course of any subsequent disciplinary hearing or tribunal proceedings, or if the employee makes a data subject access request.

For further guidance, please see this article about documenting employee misconduct and disciplinary issues.

How to prove misconduct

A reasonable investigation is an important element of the Burchell test of fairness in misconduct dismissals.

The Burchell test was established in the case of British Home Stores v Burchell and states that dismissal for misconduct will only be fair if, at the time of dismissal:

• The employer believed the employee to be guilty of misconduct
• The employer had reasonable grounds for believing that the employee was guilty of that misconduct
• At the time it held that belief, it had carried out as much investigation as was reasonable

Where a reasonable investigation has not been carried out, employees may be able to argue that their dismissal was unfair on the basis that:

• The charge against them was not framed accurately and they did not know the case they had to meet
• The employer did not have reasonable grounds for a belief in their guilt

The degree of investigation required depends on the circumstances. The employer should assess its approach taking account of the following:

• The strength of the case against the employee on the first impression
• The seriousness of the allegations and their potential to impact the employee's future

While an employer may be criticised for failing to investigate thoroughly enough, the Employment Appeal Tribunal has commented that it is "never likely" that an investigation will be held to be unreasonable solely on grounds of being "too thorough".

Gross misconduct

As an employer, you may dismiss an employee fairly for gross misconduct without prior warnings and without notice. The term "gross misconduct" is used to describe the most serious types of misconduct, such as theft or violence, which would warrant instant dismissal. It will be conduct that "so undermines the relationship of trust and confidence [...] that [the employer] should no longer be required to retain [the employee] in [their] employment", according to Neary v Dean of Westminster.

Read more from the myhrtoolkit blog

Unfair dismissal compensation: how much can it cost businesses?

Wrongful dismissal: how is it different from unfair dismissal?

What is employee whistleblowing and how should businesses respond?