It’s one of the toughest dilemmas for an HR professional: an employee’s terrible behaviour out of hours has left management concerned about how it reflects on the company. But can you dismiss them for it? If so, under what circumstances?

The short answer is “Yes”. But it’s never that simple.

The issue of whether an employee can be dismissed for ‘out of hours’ misconduct is a challenging one for employers. It’s made all the more difficult by the fact that there is not necessarily a hard and fast rule on whether it is appropriate to dismiss (or even discipline) an employee in these circumstances.

The Fair Work Commission does recognise that an employee can be dismissed for engaging in such misconduct but regards the circumstance where this is appropriate as limited to the following:

• the conduct must be such that, viewed objectively, it is likely to cause serious damage to the relationship between the employer and employee; or
• the conduct damages the employer’s interests; or
• the conduct is incompatible with the employee’s duty as an employee.
•  In essence the conduct under complaint must be of such gravity or importance as to indicate a rejection or repudiation of the employment contract by the employee.

How do I figure out if my case applies?

It will not always be easy to apply this test. In considering whether the misconduct justifies dismissal, the Commission will take into consideration factors such as:

• How closely connected the misconduct is to employee’s employment. For example, was the conduct out of hours bullying of an employee, or did it occur at a work-related event? Was it criminal in nature and was the employee actually convicted? However, the fact that an employee has engaged in criminal conduct does not automatically justify dismissal.
• Whether the employee was a high-profile employee or public figure such that the misconduct would attract media attention which would connect the employee to the employer, thereby damaging the employer’s reputation?
• Would other staff and customers reasonably not wish to deal with the employee?
• Did the employee honestly and openly respond to the employer’s questions about the misconduct or voluntarily disclose the misconduct (although it is also important to bear in mind an employee’s possible ‘right to silence’)?
• Were there provisions in the employee’s contract of employment, or the employer’s policies, that placed an obligation on employees to conduct themselves appropriately outside the workplace and not engage in conduct which might damage the employer’s reputation?
• Did the employer properly investigate the issue and give the employee an opportunity to respond?

But none of these factors is determinative.

(Want to know when it’s appropriate to dismiss an employee without warning? Read our article.)

A case where behaviour outside of work warranted dismissal

A recent instance of the Commission upholding a dismissal for out of hours misconduct was where an employee was summarily dismissed after pleading guilty to child-sex charges. The Commission upheld the dismissal on the basis that the employee was a public figure, so his conduct would be likely to (and did) attract media attention. This coverage meant that the employer’s clients and staff quickly found out about the conviction. Further, the employee had not voluntarily disclosed that he had been charged and in fact had attempted to obscure matters. Accordingly, even though the employee had been denied procedural unfairness, the Commission found the dismissal to be fair.

Glenn Fredericks, Barrister, State Chambers is a member of the AHRI NSW ER/IR Network Group.