In November 2016, the Fair Work Commission (FWC) made a finding of unfair dismissal in a decision which was both unexpected and unwelcome for employers.

Thankfully, on appeal the Full Bench has just overturned the finding of unfairness, providing much-needed reassurance to businesses on the steps they can take to address employee theft.

The Original Decision

A flight attendant had been caught red-handed during a crew search with several mini bottles of alcohol hidden in his clothes. He originally denied the theft, blaming it on an “inadvertent pocket[ing]” while serving passengers and that he had no knowledge of how the alcohol came to be in his possession. However, he later came clean and admitted that he had been lying.

Despite this, the FWC found that the subsequent termination of the flight attendant had been unfair on the grounds of harshness due to his long and unblemished service, the small value of the stolen items, his family circumstances and the fact that he had corrected his story afterwards regardless of the fact that his lies were clearly not credible.

The FWC stated that the employer should have implemented a penalty less serious than termination, and ordered 26 weeks in compensation. As this is the maximum amount available under our unfair dismissal laws and is very rarely awarded, it seemed an illogical result in a case which involved a very clear admission of serious misconduct.

The Appeal

The employer appealed to the Full Bench of the FWC, who earlier this week handed down a decision which overturned the original finding of unfair dismissal. It found that the original Commissioner had ‘failed to acknowledge and take into account that the [employee] was dishonest’ and as such, ignored a factor which was material to the matter.

This case will be listed for rehearing as an appeal, and the parties will get the chance to determine whether dismissal was an appropriate response to an employee who engaged in theft and subsequently lied about it. We expect the case to go in the employer’s favour but as the original decision shows, the unexpected can sometimes happen.

Key Lessons

If this matter has taught us anything, it is that even a termination with a valid reason can still be unfair. Before you make instinctive decisions about what disciplinary action to take, consider all of the circumstances. Has the employee ever engaged in this type of behaviour before? Were they cooperative during the investigation or did they withhold information? What impact did the misconduct have on the business?

If you are ever unsure about whether termination is the appropriate action to take in a particular matter, we recommend you seek professional advice.

For more information on unfair dismissal and what this means for you, clients should contact the HR Assured team. If you’d like more information about the benefits of becoming an HR Assured client contact us today for an informal chat.