The Interplay Between Criminal and Employment Law Matters

Speaking Notes – Craig Green Presentation to the Law Society of Tasmania, 3 November 2023: Criminal conduct at work In the “employment” context, the Fair Work Regulations 2009 define “serious misconduct” or “gross misconduct” as wilful or deliberate conduct that is inconsistent with continuation of the employment contract.

The definition also includes conduct that is dangerous to the health and safety of a person or to the reputation, viability, or profitability of the employer’s business.

Examples of serious misconduct include: • • • • • • •

wilful or deliberately reckless behaviour; activities that cause serious risk to the health and safety of a person; theft; assault; intoxication at work; refusing to carry out lawful and reasonable instruction consistent with the employment contract; and (the more recent addition) sexual harassment.

Criminal conduct at work therefore provides an employer with a valid reason to dismiss.

Out of hours conduct Outside of work, it isn’t as clear cut how to deal with criminal conduct, particularly if the conduct involves family and domestic violence. There are a range of things to consider when dealing with such conduct.

The relevant test for out of hours conduct has long been considered to be that set out in Rose v Telstra [1998] AIRC1592. The case involved Mr Rose engaging in a fight with a co-worker in a hotel room, where he had been accommodated whilst working away from home.

Mr Rose set up a makeshift boxing ring in the room he was staying in and came off second best, meaning he could not work the next day.

Mr Rose was ultimately dismissed by Telstra.

The approach in Rose v Telstra is as follows:

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“…in certain circumstances an employee’s employment may be validly terminated because of out of hours conduct. But such circumstances are limited: ▪

▪ ▪

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 complained of must be of such gravity or importance as to indicate a rejection or repudiation of the employment contract by the employee.”

Vice President Ross also observed: “I do not doubt that the applicant’s behaviour on 14 November 1997 was foolish and an error of judgment. He made a mistake. But employers do not have an unfettered right to sit in judgment on the out of work behaviour of their employees. An employee is entitled to a private life. The circumstances in which an employee may be validly terminated because of their conduct outside work are limited. The facts of this case do not fall within those limited circumstances.”

The tests in that case were later confirmed by the Full Bench in Newton v Toll Transport Pty Ltd (Newton) [2021] FWCFB 3457.

Questions that arise often arise in relation to conduct outside of working hours include: •

• •

When is conduct that occurs outside the usual workplace or outside usual working hours sufficiently connected to work to allow the employer to regulate it?

When should the employer be responsible for things that occur outside the workplace which injure or damage an employee?

Should there be a connection between the right to regulate conduct and being held responsible?

Is publicity a factor?

Some matters (not necessarily those involving IR considerations) suggest that it is. www.dailymail.co.uk/news/article-9211873/Andrew-OKeefe-sacked-Channel7-domestric-violence-allegations.html Other criminal conduct – drink driving for example, reporting about such charges/convictions is very common. Employers are often asked to provide statements or support an employee seeking a restricted licence. An offender’s workplace or role is often a feature of media reporting.

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The circumstance of an employee who accrued a drink driving charge out of work hours was addressed by Staindl JR in Hussein v Westpac Banking Corporation [1995] 59 IR 103, a case involving the dismissal of an employee of Westpac following the employee’s conviction on credit card fraud, unconnected with his employment as a migrant liaison officer which considered the question of the connection with the work.

Staindl JR in that case observed: “…a conviction on a drink-driving charge which occurred outside work hours would not be relevant to the employment of many people. However, it would be of critical relevance to a truck or taxi driver. It seems to me that an appropriate test is whether or not the conduct has a relevant connection to the employment.”

Google “chef - drink driving” leads to dozens of articles and reports of chefs being charged with driving under the influence. www.news.com.au/national/courts-law/masterchef-julie-goodwin-guilty-ofdrink-driving/news-story/976037ccc870e3c2fb1000dd348a69db Does publicity make the difference?

Consider the case of Death v Milly Hill Pty Ltd [2015] FWC 6422 which dealt with this issue in the context of media reporting, not just the criminal charge. In this case the employee was an apprentice butcher who was dismissed after being charged with being an accessory after the fact to murder. The employee challenged the dismissal.

The employer claimed that: • •

Other employees would resign if they were required to work with the employee and that the customers would boycott the store; The dismissal was consistent with the Small Business Fair Dismissal Code (relevant to small business with less than 15 employees) because the employee had engaged in conduct causing serious and imminent risk to the reputation, viability or profitability of the business.

The Fair Work Commission held that: •

•

•

The dismissal wasn't consistent with the Code; no investigation was conducted by the employer; and that there should be no presumption that a criminal conviction (or the possibility thereof) alone is a valid reason for termination; In the circumstances, given the shop's location in a small country town and the fact that the employee was the only named offender in the media, there was however a valid reason for the dismissal; However, the process of the dismissal was deficient, and the employee was not afforded procedural fairness – accordingly the dismissal was found to be

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unfair and the employer was ordered provide compensation of six weeks salary.

The timing and location of the conduct seems to be a factor to consider: Keenan v Leighton Boral Amey NSW Pty Ltd [2015] FWC 3156 involved a team leader kissing a co-worker in a public bar after their work Christmas function, where it was found that the was not the requisite connection between an employee’s actions and their workplace.

In this case, Mr Keenan was dismissed as a result of his conduct at and after his work Christmas function. During the function, Mr Keenan swore at multiple senior managers and directors and made inappropriate comments to a female staff member.

Following the work function finishing at 10 pm, a large group, including Mr Keenan, moved upstairs to the public bar, which had not been hired out by their employer, to continue drinking.

At this point, Mr Keenan engaged in further inappropriate conduct, including suddenly grabbing another female colleague’s face with both hands and kissing her on the mouth, then saying: “I’m going to go home and dream about you tonight.”

It was held that the conduct at the public bar could not be said to be in connection with Mr Keenan’s employment because “the social interaction which occurred there was not in any sense organized, authorised, proposed or induced” by the employer.

Keron v Westpac Banking Corporation [2022] FWC 221 also suggests that time and location are factors that allow for a degree of differentiation between how conduct is to be considered: firstly conduct at an event organised and paid for by the employer and secondly, conduct away from such an event and of a different nature.

Keron however makes it clear that the Fair Work Commission will consider one act of sexual harassment is sufficient to provide grounds for dismissal.

What happens if an employee isn’t truthful during an investigation or doesn’t disclose the fact that they are facing criminal charges?

Carlie Streeter v Telstra Corporation Ltd [2007] AIRC 679 is a case where an employee was dismissed for consensual sexual activity and other conduct which occurred in a hotel room after a work-related function had finished where other employees were staying in the same room.

It was found that there was not a sufficient connection between the complained of behaviour and the workplace.

The original found Ms Streeter had been unfairly dismissed, putting emphasis on the fact that the hotel room was away from the work event and had been privately booked and paid for.

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On appeal, a majority of the Full Bench found the decision to dismiss the employee was found to be justified on the basis that, despite her conduct being private in the sense that it was in a hotel room (albeit known by the other occupants of the room), the employee needed to be honest with her employer during the investigation, so that the employer could determine what occurred and take any appropriate action.

It was held that the employee’s dishonesty during the investigation meant the employer could not be confident that she would be honest in future, and it was said that it thereby destroyed the relationship of trust and confidence between them.

The decision noted however, if the employee had been honest in the investigation, there may not have been a valid reason for dismissal because the employee’s conduct, while offending her co-workers, was private in nature.

Strangio v Sydney Trains [2023] FWC 730 is a very recent case which involved a senior employee, a Station Duty Manager, who was dismissed in December 2022 for failing to report that he had been charged with criminal offences in May 2021.

Initially, the employee had been charged with 13 offences involving the supply of an indictable quantity of cannabis, possession or use of prohibited weapons without a permit, firearms, as well as dealing with the proceeds of a crime.

In May 2022, the employee pleaded guilty to 12 offences. A conviction was recorded for some of the charges. The employee was convicted of supplying an indictable quality of cannabis and possession or use of a prohibited weapon without a permit.

Sydney Trains was not made aware of any of the charges until April 2022 when it received an anonymous tip-off.

Sydney Trains ultimately made the decision to dismiss the employee, citing his breach of its Code of Conduct as the primary reason for his dismissal.

The Code of Conduct required employees to immediately notify their manager of the following events: •

•

if they had been charged or convicted with any offence which may impact on their ability to undertake part or all of the inherent requirements of their role; and if they had been charged or convicted with a serious criminal offence (i.e., an offence committed in NSW punishable by imprisonment for six months or more), whether or not related to work.

The employee explained at the hearing of his application that the reason he did not disclose the criminal charges was based on advice received from his criminal lawyer: that he should not disclose the matters until the final form of charges had been settled.

The employee also submitted that the dismissal was harsh on the basis that it was, at worst, a serious error of judgment and arose from a one-off incident. He also noted that the policies and procedures did not mandate dismissal for such a breach and it was particularly harsh given his remorse and his age, length of service and the adverse impact on him and his family.

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The Fair Work Commission did not agree, finding that Sydney Trains had a valid reason for dismissal. In doing so, it re-iterated that the employee’s failure to disclose was not a minor breach of the Code of Conduct. The Fair Work Commission considered it to be a breach which went to the trust between the parties.

It also considered the evidence led by witnesses for Sydney Trains that Station Duty Managers were required as part of their role to explain to staff that they could not work with drugs or alcohol in their system and, as a result of the charges, it was difficult to have confidence in the employee’s ability to deliver this message and to do so genuinely.

The FWC also did not accept the employee’s reasons for the non-disclosure. It found, irrespective of the advice given to the employee, he still had an obligation to immediately notify his employer of the charges and he failed to comply with that obligation.

Craig Green Counsel Dobson Mitchell Allport

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