Can you dismiss an employee for behaving badly outside of work?

When the national business development manager for a Victoria marine insurance company sexually harassed and threatened a woman in a taxi after a company team-building party at the Sandringham Yacht Club and was sacked, the Fair Work Commission (FWC) criticised the employer for paying for alcohol at the event – but later upheld the dismissal of the manager.

In another incident – with the opposite outcome – a Sydney Trains worker was convicted of drink-driving while employed at the company not once, not twice but three times – though it was ruled that the worker had been unfairly dismissed because the driving offence was characterised as misconduct ‘out of work’, which constituted unfair dismissal.

As an employer, you would think you have the right to dismiss an employee for behaving badly outside of work hours. Employers’ right to terminate employment isn’t always clear, however, and there are numerous cases in which Australian employers have had to go through FWC claims, hearings, decisions and appeals to arrive at a final outcome – all because the employer didn’t receive employment law guidance at the time of dismissal.

Usually you, as an employer, have no control if an employee behaves inappropriately in person or through their social media use outside of work hours. Unless you’re not advised by Citation HR’s workflows and policies, it can be a grey area as to how you deal with this.

Typical questions you’ll ask yourself include:

• Can you conduct a disciplinary process for an employee who has behaved poorly at a scheduled work function or party?
• How about if they have made a distasteful post on social media?
• What does the FWC have to say on the issue of dismissing an employee for behaving badly outside of work hours?

The FWC has made it clear in multiple rulings following dismissal for poor employee conduct: employers need to make sure that the conduct they’re relying on is connected to the employee’s employment.

Consider Glenn Rogers v Allianz Insurance Australia T/A Club Marine Insurance 2017 FWC537. In this case, the conduct of employee Glenn Rogers was ruled to be part of the event – even though the conduct happened when the work function appeared to have finished – and Rogers’s sackable conduct happened in a taxi, not an office.

What happened, in this case, was the employer organised a teambuilding event at a yacht club. After the club bar closed, a group of employees decided to go to another venue for further drinks and invited Mr Rogers to join them. Whilst in a taxi to the other venue, Mr Rogers made inappropriate and offensive sexual comments toward a female employee.

But was Mr Rogers’s conduct deemed to be sufficiently connected to his employment to justify termination?

Note that the events took place outside of the workplace and in the taxi after the team building party/event (during which the employer allowed alcohol to be served). The bone of contention was whether the employer had ended the party or not. The FWC would find that the party – a work event – was still going when Mr Rogers committed actions that earned his dismissal.

The FWC found:

• Because there was no specified finishing time for the event and the activities in the bar were an informal continuation of the same event and not an unrelated private function, the travel from the venue after the end of the event was a necessary part of the event; and
• What happened was essentially the equivalent of a sackable offence being made while at work.

The FWC was satisfied there was a clear connection between the circumstances of the employee’s conduct towards the female employee and their employment, and on top of extremely offensive language, the manager’s senior role, and short period of service helped constitute valid reasons for dismissal.

The FWC’s ruling was a reminder that employers need to take care of work parties to ensure employees behave.

A drink-driving employee might not be a sackable offence

Another test of the connection between an employee’s conduct and their place of employment was Sydney Trains v Bobrenitsky 2022. In this interesting case, Andrew Bobrenitsky had been employed by Sydney Trains for 16 years. His employment was terminated in February 2021 once he was convicted of drink-driving – four times over the limit. It was the man’s third drink driving offence and he was prosecuted in court.

Despite being in breach of various employment obligations under the employee code of conduct of Sydney Trains, it was ruled Bobrenitsky had been unfairly dismissed. Why? Because the driving offence was characterised as misconduct ‘out of work’ – and this could never constitute a valid reason for dismissal. As such, the dismissal was found by the FWC to be harsh, unjust, and unreasonable. Another thing the employer had to consider: Mr Bobrenitsky was less likely to obtain further employment due to his licence restrictions and older age.

Damage was done to the employer’s credibility, and the employer learned a harsh lesson about the importance of checking with HR employment law experts before sacking the employee. There was a further twist, however: eventually the Full Bench overturned the initial ruling. Valid reasons for dismissal were found to exist, thus the dismissal of Mr Bobrenitsky was upheld – after great expense to the employer.

As an employer wanting to sack an employee who has breached a code of conduct outside of work hours, you need to understand FWC Full Bench will consider the following factors heavily:

• The nature of the out-of-hours conduct;
• Where the out-of-hours conduct occurred;
• The impact of the conduct on the employer; and
• The nature of the employee’s role and the business.

Follow written policies and processes and save your company from getting harmed by wayward employees

If you don’t have an Employee Handbook, a Code of Conduct or dismissal policies in place already, Citation HR can help you set these up and put them in writing. We have templates ready to go and can customise specific policies for you.

An Employee Handbook or Code of Conduct should include:

• Information that guides you in responding to incidents of employees acting inappropriately outside work hours.
• A social media policy will also help protect the employer from adverse effects that may be inflicted by an employee’s social media activity.

Although you may not be able to monitor an employee’s conduct outside the confines of their employment, you’re still able to ensure that there are options available in the unfortunate event that inappropriate behaviour has been conducted. Guidance is essential so you cannot be found to have set up constructive dismissal – which Citation HR has specific guidance around.

How can Citation HR help?

Use Citation HR to support your company’s HR culture. It’s HR software plus an Advice Promise, and over-the-phone support designed to guide you through legally compliant decisions when it comes to misconduct, workplace harassment, reasons for dismissal, investigative processes, and proper procedures. We’re available 24/7 and offer an HR Advice Line for real human guidance on crucial decisions.