Summarily dismissing employees for negligent rather than deliberate misconduct is now an "outdated concept", the Fair Work Commission has suggested in reinstating a security officer sacked for admitting a minor to a casino.
Commissioner Ian Cambridge said courts and tribunals "appear to be gradually casting off the proposition that negligence would justify summary dismissal, as it represents an outdated concept which was established upon the principles which applied during the era of the master and servant relationship".
He said, however, that while the common law might continue to recognise that summary dismissal is justified for gross negligence, "the statutory position may not".
He said the "less stringent and simplified set of evidentiary and procedural requirements" for summarily dismissing employees under the Small Business Fair Dismissal Code should extend to larger employers.
"It would be illogical to contemplate that a 'large business' would not be required to comply with, or more likely, exceed, the requirements of the Code," he said.
Commissioner Cambridge said the code's "use of the words, 'Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures' when combined with both the absence of any mention of grossly negligent or similar conduct, and the mention of reporting the employee's conduct to the police, is suggestive of a requirement that there be a wilful character to any action which would justify summary dismissal, as opposed to other dismissal".
"Essentially, I believe that the Code is directing that summary dismissal would usually only be justified where the actions of the employee contain an element of mens rea, either in respect of serious misconduct or serious breach of occupational health and safety procedures," he said.
"Consequently, the Code would generally require that a small business should implement summary dismissal only where the employer is satisfied that the actions of the employee are intentional, rather than negligent or incompetent.
"Logically, the mens rea prerequisite for summary dismissal as I describe it, would apply to large businesses, perhaps with a greater degree of stringency and satisfaction."
Commissioner Cambridge said that alongside the code's modification of the common law position on summary dismissal for negligence, employment law had also developed in the same direction.
Security officer not grossly negligent
Commissioner Cambridge said the "admittedly deficient" performance by the security officer at Sydney's The Star casino "didn't constitute the gross negligence which might justify summary dismissal".His conduct, he said, "did not involve the grave, serious or significant departure from the standard of care which should have been exercised and which caused substantial loss or damage to the employer, such as would be necessary to provide valid reason for his summary dismissal".
Sacking the employee was a "completely disproportionate overreaction" to the officer's negligent action, when an "appropriate warning and coaching" would have been the preferred approach, after the officer admitted he was at fault.
The casino summarily dismissed the security officer early last year after an investigation found that he allowed a 17-year-old female patron to enter its main gaming floor after failing to properly check her ID, in breach of the Casino Control Act.
The Independent Liquor and Gaming Authority (ILGA) fined the casino $5000 for the violation.
Represented by United Voice, the security officer argued the busy harbourside entrance was understaffed and he was distracted by a potential altercation when he failed to see that the ID belonged to another person who looked "remarkably similar" to the minor.
The girl was fined $110 when she attempted to enter a second security check-point with her false ID.
After reviewing CCTV footage, Commissioner Cambridge noted that other security staff gave "similar cursory vetting" to IDs that same night.
One key error the employer relied on in the case was the security officer's failure to look at the minor's face.
But Commissioner Cambridge said the CCTV footage showed that the officer had done so as she approached him, if not while he was looking at her ID.
"The absence of any such recognition is a significant factual omission which as a result, erroneously portrayed and artificially exaggerated the mistake made (and admitted) by the [security officer]," he said.
Commissioner Cambridge noted there had been deficiencies in the disciplinary meeting, coupled with a series of errors in the dismissal letter (which the casino relied on in the case) and an "unacceptable delay" of 22 days before the security officer was given the letter, which was blamed on the absence of the "relevant HR officer".
Casino "unduly influenced by extraneous factors": FWC
Commissioner Cambridge found that the casino's decision was "inappropriately influenced" by its need to appease the ILGA, "which led it to erroneously apportion all blame to human error and to seek to appear to be 'tough' on the individual security officers by terminating their employment".He said the casino was also unjustly influenced by its concern that the security officer had, just a few weeks before, refused to sign a "dubious" memorandum that appeared to give it the power to sack officers if they "negligently" admitted a minor.
Commissioner Cambridge said the casino had "entirely unreasonable standards and expectations" for the security officer's performance, yet it failed to accept "any share of responsibility", despite recognising during the investigation that its security arrangements had been substandard.
"The approach that the employer adopted when considering the dismissal of the [security officer], was unduly influenced by extraneous factors which made erroneous findings an almost inevitable outcome," he said.
Ordering the security officer's reinstatement with backpay, Commissioner Cambridge recommended that the casino issue a formal written warning and conduct regular one, three and six month reviews of the officer's ID checking performance.
He also recommended it enhance its security measures; introduce roped vetting areas; review vetting on a regular basis via CCTV; and introduce coaching for security officers.
John v The Star Pty Limited [2014] FWC 543 (22 January 2014)