If you become aware of allegations that an employee has acted improperly or potentially illegally outside of work hours, what should you do?
While employers have the right to take action to safeguard their organisation’s reputation, they must balance this with the employee’s rights within the specific circumstances. This means following a fair and lawful process to establish the facts before taking any disciplinary decision, or you risk legal complaints. Simply firing someone on the spot for something they have done outside of work could expose the organisation to a claim for unfair dismissal.
In this practical guide for employers, managers and HR, we examine the tricky issue of dealing with misconduct outside of working hours and whether this could be lawful grounds to dismiss someone.
What does the law say about employee conduct outside of work?
When it comes to conduct, there will typically be express provisions within the employee’s contract of employment, or workplace policy, as to the appropriate behaviour expected of staff. Even where there are no express contractual provisions regarding the behavioural standards expected of staff, there is also a duty of mutual trust and confidence implied into every employment contract. This means that if an employee behaves in a way that is contrary to this duty, for example, if they are guilty of harassment or insubordination, this could constitute a breach of the contract.
However, when it comes to allegations of misconduct, these usually relate to wrongdoing within the workplace or, at the very least, during working hours. Still, there may be occasions when conduct outside of the workplace can seriously impact the employment relationship, affect the employee’s suitability to do their job and/or bring the employer’s reputation into disrepute. This could be down to the nature of the employee’s role within an organisation, for example, if they hold a senior position or represent the face of the company, or where their conduct could affect their relationship with colleagues or clients.
In such cases, even if there are no specific workplace rules or contractual provisions in place as to how staff must conduct themselves other than at work, improper behaviour outside of work may again amount to a breach of the duty of trust and confidence.
Can you take disciplinary action for misconduct outside of work?
Provided a full and fair investigation is undertaken by the employer into any allegations of misconduct outside of work, and any findings made by them are made based on clear and credible evidence of the employee’s improper behaviour, not just hearsay, the employer may be entitled to take disciplinary action against the employee for misconduct.
Common examples of where misconduct outside of work could lead to disciplinary action could be, for example, where an employee acts inappropriately in front of clients at a work’s party, perhaps by becoming overly intoxicated and/or abusive, or if they post something derogatory online about their job, the business or other members of staff.
The company or organisation may also have its own examples, as set out in its disciplinary and dismissal policy, or a separate code of conduct policy, as to what will be treated as misconduct. This could include anything taking place outside of working hours that is likely to reflect badly on the business or undermine the employment relationship, such as an employee taking advantage of their employment position for their own gain or personal advantage, or disclosing confidential information or trade secrets obtained through the course of their employment. In some cases, the employee’s conduct outside of work may not only constitute a breach of the implied duty of trust and confidence, but also a breach of the implied duty of fidelity (such as misuse of company property, like using customer or client lists) and of the duty of confidentiality (such as divulging a client password).
Can you dismiss someone for misconduct outside of work?
An employee’s conduct outside of work would not usually constitute grounds for dismissal, however, there can be certain circumstances in which behaviour outside of the workplace, or working hours, can so seriously undermine the employer-employee relationship that it could justify a decision to dismiss.
Misconduct is one of five potentially fair grounds for dismissal under the Employment Rights Act (ERA) 1996. This means that provided the employer can establish that they have acted reasonably in treating the misconduct as sufficient to justify terminating employment, and have followed a fair procedure, the dismissal will be fair.
In some cases, where the conduct outside of work is especially serious, for example, where the employee’s improper behaviour has directly contributed to customer complaints, the loss of clients or negative publicity, this could even justify dismissal for gross misconduct. This is where an employee is summarily dismissed, without notice or pay in lieu of notice, because the misconduct can be treated as a fundamental breach of contract.
What constitutes gross misconduct outside of work will often depend upon the context in which the conduct has taken place and how serious the effects are, or are likely to be, of the behaviour in question. In most cases, summary dismissal can be justified by a single incident of gross misconduct. However, the cumulative effect of a series of acts that show a pattern of serious misconduct can also warrant dismissal without notice or pay in lieu. For example, a single incident of racist, sexist or homophobic abuse on social media against a co-worker could justify dismissal for gross misconduct, whilst an ongoing campaign of non-discriminatory teasing and bullying on social media could also amount to gross misconduct.
Can you dismiss someone for criminal behaviour outside of work?
In the context of criminal behaviour outside of work, if an employee is arrested or convicted of an offence, this may not necessarily, of itself, be a reason for dismissal.
Where an employee has been found guilty of theft or any other dishonesty offence, it is easy to see how this could negatively impact the employment relationship and justify a decision to dismiss, as it calls into question the employee’s trustworthiness. This is even more significant if the employee handles money or accounts, or if they work in a regulated environment.
Similarly, if the employee is convicted of a serious or violent crime, apart from the fact that any custodial sentence will frustrate the employment contract if the employee is in prison, this type of criminality will almost certainly have an impact on the employment relationship and potentially bring the business into disrepute.
However, where an employee has been charged with an offence but is awaiting trial, depending on the nature of that offence, the employer may want to consider suspension or redeployment as an alternative to dismissal, at least pending the outcome of the case.
Where any criminal conduct is less serious, much will depend on the nature of the offence and the circumstances involved, and must be approached on a case-by-case basis. If the scenario is such that this either affects the employment relationship or the reputation of the business, for example, a small scuffle in a bar but in front of an important client, then disciplinary action, and even dismissal, may be justified in this context.
What happens if you dismiss someone unfairly?
Under the ERA 1996, where an employee’s conduct outside of work falls far short of what is deemed as acceptable, this is a potentially fair basis for dismissal. Still, even if the employer can clearly establish misconduct on the part of the employee outside of work, the decision to terminate their employment contract will only be deemed fair if the employer has acted reasonably in all the circumstances in treating this as a sufficient reason to dismiss.
If a decision is reached to dismiss an employee for conduct outside of work, the employee is more likely to challenge this decision given that they may take umbrage with the fact that they are being heavily penalised for something that took place in their own time. Employees with 2 years’ continuous service can bring a claim for unfair dismissal, where the employment tribunal will then closely scrutinise whether any dismissal was one which fell within a range of reasonable responses that were available to the employer. This can include previous decision-making and whether the decision to dismiss is consistent with decisions made about other employees in similar circumstances. It can also include an assessment of whether the conduct was so serious that it justified dismissal, as opposed to an alternative and lesser disciplinary sanction, such as a first or final written warning.
Additionally, in its overall assessment of reasonableness, the employment tribunal will look at whether the employer followed a fair disciplinary and dismissal procedure. Even in cases where the alleged misconduct outside of work is so serious that it justifies summary dismissal, the employer must still thoroughly investigate the circumstances involved and give the employee the opportunity to defend any allegations made against them.
A failure to follow a fair process, and to act reasonably in all the circumstances, can lead to a tribunal finding of unfair dismissal for which the employer will be ordered to pay compensation. They could also potentially be ordered to reinstate or re-employ their former employee.
Best practice advice to deal with misconduct outside work
Given that employees are generally free to conduct themselves as they choose outside of work, any decision to take disciplinary and dismissal action should be approached by an employer with caution. Very often, a verbal warning is all that is needed to address any improper behaviour, unless the matter is especially serious and has the potential to impact the employee’s suitability to do their job, the employment relationship or the business.
In circumstances where disciplinary action is deemed necessary, it is vital that employers adhere to the guidance set out in the Acas Code of Practice on disciplinary and grievance procedures. This sets out the basic requirements of fairness and standards of reasonable behaviour applicable in most misconduct cases, and should be made easily accessible to all members of staff in either their employment contracts, staff intranet site or staff handbook.
Under the Acas Code of Practice, the employer must:
- Fully investigate the misconduct without unreasonable delay: the employee should be interviewed, along with any witnesses, and all other evidence thoroughly reviewed.
- Decide if there is a case to answer: only if there is sufficient evidence to support an allegation of misconduct outside of work should the matter go to a disciplinary hearing.
- Notify the employee of the disciplinary hearing in writing: the employee should be given written notice of the place, date and time of the hearing, together with a written explanation of the case against them and copies of any evidence in advance.
- Inform the employee of their right to be accompanied at the disciplinary hearing: the employee must be told of their statutory right to be accompanied at the hearing, on reasonable request, by either a colleague or trade union representative.
- Allow the employee to fully state their case: at the hearing, the employee should be allowed to defend any alleged misconduct, including cross-examining any witnesses, adducing their own evidence in rebuttal and putting forward any mitigation.
- Make a decision promptly: following the hearing, a decision must be made without unreasonable delay as to what, if any, disciplinary action should be taken. The decision and reasons for this must then be notified to the employee in writing, ideally within 24 hours. If a decision is made to dismiss the employee, they must be told the date on which their employment will come to an end and whether notice pay is to be given.
- Allow the employee the right of appeal: the employee must be notified of their right to appeal, the grounds on which an appeal can be made and the procedure to follow.
All employers must have a disciplinary and dismissal procedure setting out the basis upon which an employee can be fairly dismissed, as well as the circumstances in which other lesser disciplinary sanctions can be imposed. By clearly setting out the type of conduct that might lead to disciplinary proceedings, including conduct outside of work, the employer can help to demonstrate the fairness of their approach to all types of misconduct matters.
Still, in order for dismissal or disciplinary action to be fair, rather than adopting a blanket approach, the employer must always carefully consider each scenario on its own facts.
Can you dismiss someone for something outside of work FAQs
The matters contained in this article are intended to be for general information purposes only. This article does not constitute legal advice, nor is it a complete or authoritative statement of the law, and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, express or implied, is given as to its accuracy and no liability is accepted for any error or omission. Before acting on any of the information contained herein, expert legal advice should be sought.