Court rules that employer’s reliance on information obtained after termination is valid

Workplace Directions

Background

Mr Hill (employee) brought proceedings against Compass Hill Pty Ltd (employer) alleging breach of contract after his employment was summarily dismissed after only two months of service.

The employer operated a Lodge which is a licensed residential centre to about 80 disabled persons who suffer from a range of intellectual disabilities.

The employer argued that the employee had been validly terminated for serious misconduct and that the contract of employment had therefore not been breached.

The contract itself, provided for termination ‘immediately and without notice’ in the event of an employee being considered to have committed serious misconduct. The term ‘serious misconduct’ was also defined in the contract as ‘Without limitation…dishonesty, fraud, assault… or failing to comply with any of [the employer’s] policies or procedures from time to time.’

The employer alleged that during the course of his employment, the employee repeatedly failed to comply with policies and procedures at the workplace in relation to updating medication distribution records, arranging transport for residents and administering financial records.

It was also alleged that the employee falsified his original employment application by including a First Aid Certificate that belonged to his son, which he tried to pass off as his own, in order to satisfy the advertisement criteria for the position of Manager, which the employee was appointed to. The issue of the First Aid Certificate and the allegation of falsification first came to light after the employee had already been dismissed.

The decision

Justice Cowdroy noted, in relation to the issues of the first aid certificate arising post-termination that ‘there are clear authorities for the principle that if an employer terminates an employee for misconduct on certain grounds and another ground of misconduct is subsequently discovered,
the fact that the employer is not aware of such misconduct while the employee is employed is not relevant. The employer may subsequently raise such misconduct in support of a decision to terminate the employee.’

On the issue of the first aid certificate, the employee attached to his employment application a First Aid Certificate bearing the name Simon Peter Christopher Hill. On his employment application he wrote his name as being Paul (Simon Peter Christopher) Hill. The employee acknowledged that the certificate he attached to his employment application had been issued to his son and stated that he ‘attached it by mistake.’ After he was questioned, the employee stated that he attended first aid training with his son and thought that in such circumstances he was entitled to a first aid certificate.

Justice Cowdroy found that the employee did not undertake any first aid qualification himself, but assisted his son in undertaking such a qualification. Justice Cowdroy was also satisfied that at the time the employment application was made, the employee knew that he did not hold a First Aid Certificate as he had not undergone the relevant training.

The employee maintained that the attaching of his son’s First Aid Certificate was a mistake and that he did not intend to mislead the employer. Justice Cowdroy found in relation to such claims that ‘the Court finds it inconceivable…that Mr Hill made such statements by mistake.

The court finds that Mr Hill deliberately attached his son’s first aid certificate…that Mr Hill changed the name on his application to more closely resemble the name on the first aid certificate (i.e. his son’s name)…[t]he Court is satisfied that the name was changes to deliberately mislead …’

Justice Cowdroy also addressed the other issues relied upon by the employer as grounds for the employee’s dismissal.

 On the issue of updating medication distribution records, the Court found that the employer had a clear system in place which dealt with the keeping of medical records. The system required the employee to manually record all relevant details in relation to the administration of medication and medical appointments of the residents in the appropriate diary or folder. It was the employer’s expectation that the employee follow this system. The employee failed to follow this system, and instead attempted to implement an electronic recording system without first consulting his employer or obtaining permission to do such. This caused important medical information to be incomplete or missing. Justice Cowdroy said that ‘[the employee’s] decision to ignore the instructions of his [employer] on this point without consulting…amounts to wilful disobedience of the [employer’s] instruction.’

On the issue of arranging transport, it was one of the employee’s duties to arrange transport for patients to attend specialist appointments. The employee was given some autonomy to determine when he should complete the task of scheduling appointments. Such autonomy did not extend to not carrying out the task at all. Justice Cowdroy found that the employee’s failure to carry out such a task ‘was a fundamental failure to carry out his responsibilities.’

On the issue of administration of financial records, the employee was expected to perform tasks in relation to the distribution of ‘comfort money’ to the employer’s residents. He was required to maintain records by filling in template sheets with record details such as the amount of credit a resident had against their name, any amounts drawn out and place a signature on the sheet as a sign of supervising the withdrawal.

During his employment, the employee inadequately maintained such records – for example, he failed to counter sign a withdrawal to one resident and issued a withdrawal of $15.00 to another resident who has $0.00 credit to her name. J Justice Cowdroy found there was in existence a system for the recording and distribution of comfort money.

The records show a number of instances where there was a failure by the employee to comply with the requirements of the system. ‘He refused to follow the required practice’ as outlined by his employer.

In the concluding comment of his judgment, Justice Cowdroy found that ‘it is possible that some of the individual instances of [the employee’s] conduct during his employment, particularly with regard to [the employee’s] failures to follow the instruction of his [employer], may not have reasonably formed a basis for his dismissal if they were isolated incidents.’ He went on to say however, that ‘the totality of [the employee’s] conduct…demonstrates a persistent unwillingness to follow the instructions of his [employer] and an unwillingness to follow the various procedures established by [it]. This conduct was sufficient to constitute a well-founded reason for [the employer] to summarily dismiss [the employee].’

The court also found that the employer was entitled under the contract and justified in ordering the employee’s dismissal without further notification to him for his failure to comply with his employer’s policies and procedures. It dismissed the employee’s breach of contract application.

Comment

This decision highlights that the courts are willing to permit employers to rely on information obtained post termination, which demonstrates misconduct of an employee during their employment, in order to support it’s reasons for dismissal.

Authored by Elizabeth Radley, Special Counsel, Newcastle.


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