Business ordered to rehire worker it sacked for operating a side business on company time: A lesson in proper dismissal procedure

A Melbourne-based businessman has conceded he jumped the gun in firing a worker for operating a side business on company time, after being ordered to rehire her last week.

The Fair Work Commission (FWC) has ruled cabinetry and hardware importer Lek Supply unfairly dismissed sales associate Abigail Jackman in April over allegations she stole from the company by working on her own business.

Jackman started her own business, Royal Scent & Co, while she was on maternity leave last July, selling candles, as well as bath and body products.

Lek alleged when she came back to work Jackman was taking calls and fielding text-based customer queries on her phone during business hours.

However, despite finding Jackman did conduct her private business during her working hours, commissioner McKinnon ruled the manner in which Jackman was dismissed was “harsh”.

McKinnon found Jackman was given no opportunity to respond to the reasons for her dismissal, which occurred without notice in a meeting she was not told the purpose of.

“It was a disproportionate response to a valid concern, which had only recently become apparent,” McKinnon said.

“A warning would have been a more appropriate response.”

Jumping the gun

Speaking to SmartCompany, Lek Supply chief executive Ben Lek conceded he jumped the gun by dismissing Jackman in the way he did.

“The issue was created from her and it was quite a major issue,” he says.

“It should have never happened, but at the end of the day, we didn’t follow the steps for dismissing her properly.

‘“With a small business like ours, not having legal representation to know all the ins and outs is probably where we made our mistake,” he says.

Lek does not intend to appeal the decision and says he will welcome Jackman back to the business in the coming weeks.

Shane Koelmeyer, director at Workplace Law, says the case is a classic example of a business not affording a worker procedural fairness he has encountered often.

“Where the employer fell down here was in not affording the employee the opportunity to respond to the allegations,” he tells SmartCompany.

“Best practice would have been for the employer to put the allegations to the employee in writing and given her the time and chance to explain or respond.

“The employer’s decision should have then only been made after receiving and reviewing those responses and explanations,” he says.

“Worst case scenario”

Koelmeyer said if the business had sought advice the matter could have been rectified within a few days, but instead, the business has received what he describes as the “worst case scenario” in unfair dismissal cases.

“[It] may be seen by the other employees as the employer’s judgment or decision-making being undermined or questioned — which can make it harder for them to manage their employees in the future,” he says.

McKinnon found against Lek’s argument that Jackman was summarily dismissed, which may have justified the lack of notice.

Jackman was paid one week’s wages in lieu of notice and was not required to work the notice period, while there was also no mention of “serious misconduct” (crucial for summary dismissal) in the letter of termination.

Garry Bircks, an industrial advocate with Just Relations consultants who represented Jackman, says his client is happy to return to the company.

“She had no problems with her workmates,” Bircks tells SmartCompany.

Bircks said Jackman was content with the decision, but she was disappointed the FWC decided not to award lost wages.

“The decision is in her favour, but she’s not happy with it to the extent that there has been no award of lost wages … there have been substantial losses as a result of the dismissal,” Bircks says.

McKinnon decided not to award lost wages because of the weak financial position of the business and because Jackman’s conduct was the “sole catalyst” for the dismissal.

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