Most employers would identify intoxication (whether from drink or drugs), fighting or other physical abuse, indecent behaviour, theft, dishonesty, sabotage, serious breaches of health and safety rules and gross insubordination as examples of gross misconduct.

You might want to specify other offences, depending on the nature of your business (for example, accepting bribes, offering bribes, downloading pornography, using personal software (with the risk of importing viruses), misusing confidential information or setting up a competing business).

Caution should be exercised when dealing with an employee under the influence of alcohol or drugs. If the employee is an alcoholic or drug addict then this should be dealt with as a capability issue and not as gross misconduct in the first instance.

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3. Does this mean I can decide for myself what conduct merits instant dismissal?

To a limited degree. But instant dismissal is a very severe penalty, and if the employee takes you to an Employment Tribunal, you would have to be able to demonstrate that your decision:

· would be one that a reasonable employer would have made;
· was itself both fair and reasonable in the circumstances.

You would also have to show that the offence was so wrong that dismissal was an appropriate sanction. It is always advisable to list the offences which merit instant dismissal in the disciplinary policy - though you should make it plain that the list is not exhaustive.

New regulations, which came into effect in October 2004, set down minimum procedures which have to be followed, even in gross misconduct cases (see question 4).

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4. What would a tribunal consider in deciding whether a dismissal for gross misconduct was fair?

A range of factors. For example:

" did you have a genuine belief in the employee's guilt;

" was it reasonable to hold this belief from your investigation;

" how thoroughly did you investigate the alleged offence;

" was the employee given all of the information that had been gathered as part of the investigation;

" did you give the employee an opportunity to state his (or her) case;

" were they entitled to be accompanied by a work colleague or trade union representative;

" did you hold a disciplinary hearing, chaired by someone who was impartial;

" did you warn the employee they were to attend a disciplinary hearing;

" did you give them time to prepare for the disciplinary hearing;

" was the offence gross misconduct, as set out in your disciplinary procedures, and was the employee aware of the penalty that could be imposed as a result of that misconduct;

" were there mitigating circumstances or other facts that should have been taken into account, for example health or domestic problems, provocation or ignorance;

" were alternatives to dismissal considered;

" to what extent was a similar penalty invoked in similar cases; and

" was the employee informed of his right of appeal and given an opportunity to appeal against the decision to dismiss?

The legislations which came into force in October 2004, provides a 'standard' (3-stage) minimum procedure which should be followed in almost all dismissal cases:

" set out the problem in writing;

" allow the employee a face-to-face meeting to discuss it; and

" allow the employee an opportunity to appeal if the decision goes against him (or her).

But in a small number of cases a 'modified' (2-stage) procedure can be adopted. This procedure is shorter and applies only in a small number of cases where the employee has been dismissed "on the spot" before the procedure has been initiated. It involves:

" setting out the alleged misconduct which has led to the dismissal in writing, together with any evidence that lead you to believe that this employee was responsible for the alleged misconduct and notifying the employee of their right to appeal against their dismissal ; and

" inviting the employee to an appeal meeting if the employee who has been dismissed asks for it.

This procedure is designed for a small number of exceptional cases, and should only be used, with extreme caution and preferably with legal advice, where:

" the gross misconduct is very serious (for example, you were entitled to dismiss (and did so dismiss) the employee by reason of their conduct, without notice or any payment in lieu of notice;

" it has been established that the gross misconduct has occurred (an honest belief based on reasonable grounds, after a reasonable investigation, is not sufficient); and

" the dismissal occurs when you become aware of the conduct or immediately thereafter.

Where the procedures have not been invoked it is likely to give rise to an automatic finding of unfair dismissal, if an employee with at least 1 year's service complains to the Employment Tribunal. If the employee claims and proves discrimination then this 1 year rule does not apply. Any compensatory award made to the employee could be enhanced by up to 50%, up to the maximum cap (currently £58,400.00).

Your disciplinary procedures should have been reviewed to ensure that they comply with the statutory minimum requirements. If in doubt, take legal advice.

Non-compliance with the statutory requirements is permissible only in wholly exceptional circumstances, including:

" where compliance would be contrary to the interests of national security, and

" where there is reasonable cause to believe that compliance would result in a significant threat of serious physical or mental harm to the employer or to a third party, or damage to property or further harassment.

In addition to being fair, any dismissal for gross misconduct must also be reasonable (see question 5).

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5. What would a tribunal consider in deciding whether a dismissal for gross misconduct was reasonable?

Again, it would consider a range of factors, including:

· was the offence gross misconduct - that is, was it serious enough to destroy the contractual relationship;
· whether correct procedures were used, taking into consideration the law (see question 5), and the resources and size of your company;
· whether your response was within a band of responses that a reasonable employer would take;
· whether you considered alternative sanctions e.g. a transfer, demotion or suspension;
whether mitigating factors were taken into account, such as the past history of the employee involved, his (or her) age, position, length of service and previous warnings.
For example, while it might be reasonable instantly to dismiss a relatively new employee, with reserved references, who comes in fighting drunk one Friday afternoon and tries to knock his foreman's block off, it might not be reasonable instantly to dismiss a long-standing employee with a good record, who gets tiddly celebrating the birth of a grandchild.

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6. But surely our response to misconduct has to be consistent?

It is important to be consistent in taking disciplinary action, but it may be that there are strong mitigating circumstances in one case that are not there in another. So you need to investigate all the circumstances thoroughly, and consider them carefully. If you sack one employee for an offence which, in another, merits only a written or verbal warning, you need to be able to justify your decision to impose a more severe penalty in the one case than the other. Otherwise you could face allegations of unfairness and discrimination. Keep written records of why you did what you did.

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7. I thought instant dismissal meant sacking someone on the spot, and that was that?

No.

If you sack someone without undertaking a proper investigation, holding a disciplinary hearing, giving the employee (accompanied by a companion) the opportunity to put his (or her) case, considering the circumstances, and if the decision is to dismiss, giving the employee an opportunity to appeal, you will lay yourself wide open to being sued.

From October 2004 the minimum that has been required of you in most dismissal cases is adherence to the 'standard' (3-stage) procedure (see question 4), or possibly the 'modified' (2-stage) procedure (see question 4). But this is only a minimum, and even if you stick to it you can not assume you will be free from criticism by an Employment Tribunal. The Employment Tribunal may consider whether there were any other procedural steps, in addition to those set out in the statutory dismissal and disciplinary procedures, that you should have followed before dismissing your employee. This is particularly the case if the employee's contract of employment provides for any additional procedures to be followed. Employers should also bear in mind the ACAS code of practice, which the Employment Tribunal is required to take into account.

If the offence is gross enough, and overt enough, to merit instant dismissal, you should be able to get your disciplinary hearing and appeal out of the way within 2 to 3 weeks, although speed should not override the need for it to be fair. If it goes to a Employment Tribunal it could drag on for months.

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8. Should we spell out what we would consider to be gross misconduct in the employee's terms and conditions?

You should give examples in the disciplinary policy of what you would consider to be gross misconduct (but state that the list is not exhaustive). In areas where it is possible for employees to assume that they are only committing a minor misdemeanour, or even no misdemeanour at all - for example, use of personal software in work computers - you must ensure that they are aware of the consequences, if you would treat it as gross misconduct. If an ex-employee can reasonably argue that they were sacked for doing something they had no reason to suppose was a sackable offence, you may lose at an Employment Tribunal.

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9. If an employee has done something which obviously counts as gross misconduct, what procedure should I adopt?

" First limit the damage (for example, if it is someone who has come in drunk, it may be necessary to remove them from the premises, especially if they are in charge of machinery). Generally speaking, however, the employee should remain at work, or if you have the contractual right be suspended on full pay, pending an investigation.

" Carry out an investigation. Are you certain it was drunkenness, rather than a medical condition? If it was drunkenness, was it self-induced, or is there any possibility that someone had spiked their drink? If you have not already done so, you may decide at this stage to suspend the offending

employee (on full pay) while the investigation and disciplinary process continues.

" Interview all relevant witnesses, including the employee.

" If the investigation suggests that disciplinary action is warranted, call a disciplinary hearing. Give the employee ample warning (say, 3 days), and tell him or her that he may be accompanied at the hearing by a work colleague or union official.

" Make sure the employee is well aware of the allegations before the meeting. You are now legally required to give written details of the offending behaviour, and the reasons why you believe the employee is responsible for it. You should provide this when you ask the employee to attend the disciplinary hearing which should also be done in writing.

" Give him access to any evidence on which you will rely, including documents and statements from any witnesses, prior to the disciplinary hearing. Again, provide this when you ask the employee to attend the disciplinary hearing.

" Ensure that the disciplinary hearing will be conducted by an objective and impartial person who has not been involved in the investigation.

" Give the employee the opportunity to put his or her case forward.

" If the employee raises any issues that need further investigation, adjourn the hearing. This may involve interviewing new witnesses, re-interviewing existing witnesses or checking documents.

" Make sure there is a record of the proceedings, in case you need to refer to it in making your decision and in case you need to produce it as evidence for an Employment Tribunal. Have someone other than the employee's witness taking notes.

" Adjourn the hearing to consider your decision. Do not make an instant decision, otherwise it might look as though you had already made up your mind.

" Consider mitigating circumstances (for example, the employee's previous disciplinary record and long service) before reaching a decision.

" Make sure the employee receives a letter stating the reasons for dismissal or other disciplinary sanction.

" Tell the employee of the opportunity to appeal against the decision.

" Set up an appeal meeting if requested to do so. Ideally, the appeal should be dealt with by a more senior manager than attended the first meeting. The employee has the right to be accompanied at the appeal meeting.

" Adjourn the hearing to reconsider the decision.

" Tell the employee your response to their appeal.

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10. If we have to sack someone for gross misconduct, should we give pay in lieu of notice?

No. The point of gross misconduct is that it is conduct so bad that you are justified in dismissing the employee instantly (subject to having followed a disciplinary procedure). If you give them notice - or pay in lieu of notice - you may weaken your case.

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11. If an employee who has been sacked for gross misconduct tries to sue us, what will they be suing for?

Unfair dismissal, assuming that they have been with you for more than a year. If they have not been with you for a year, but think they can prove that the sacking was due to discrimination or any of the 'inadmissible' reasons where a years service is not required (see Dismissing employees), then they can still sue for unfair dismissal and/or discrimination.

Wrongful dismissal (normally for pay in lieu of notice) at an Employment Tribunal, regardless of their length of service. Alternatively (and particularly if they are so highly paid that the limits on Employment Tribunal awards (currently £25,000) make the Tribunal route unattractive, they may sue you for wrongful dismissal in the civil courts.

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12. Can we be sued by a fixed term contract employee whom we have sacked for gross misconduct?

Yes.

Depending on the circumstances as the employee may be able to sue you for:

" unfair dismissal, assuming that they have been with you for more than a year. If they think they can prove that the sacking was due to discrimination or any of the 'inadmissible' reasons where a year's service is not required (see Dismissing Employees question 5a), then they can still sue for unfair dismissal and/or discrimination; and

" breach of the fixed term contract (for example, for damages representing their loss during the remainder of the contract term or in relation to any shorter notice period referred to in the contract).

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13. How long will it take for a case to come to the Employment Tribunal?

Usually about six months from the date of filing the application. But it may be a shorter period, or much longer, depending on the Tribunal at which it is listed, and the complexity of the case. The legislation that came into effect in October 2004 is designed to divert cases away from Employment Tribunals, so waiting times may eventually shorten.

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14. How much is it likely to cost us to defend such a case?

That depends on the complexity of the case. The cost is most unlikely to be below £2,000-3,000, and may be at least double that figure. Depending on the complexity of the case, and your geographical location, it could be three or even four times as much.

Do not forget that costs would not only include the fees to any external advisers, but also the loss of productive activity by company employees involved in defending any claim.

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15. Would we do better just to pay the offending employee to go away?

That depends on how good your case is, and the message you wish to give to other employees. Sometimes commercial reality will suggest that it is more cost effective to settle out of court, on a 'nuisance value' basis. Pursuing 'the principle' will cost money; but on the other hand it will send a powerful message to other employees who might otherwise be tempted into launching frivolous or vexatious legal action. If you decide to settle, take legal advice on how to record the agreement. Your legal advisor or ACAS will be able to assist with this.

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16. If we are sued, what sort of evidence do we need to be able to present to defend our case?

You would need to be able to present:

· all relevant documentary evidence: for example, letters you have written to the employee; copies of written warnings; notes on any incriminating evidence; documents relied upon during the disciplinary process; notes on any investigatory or disciplinary hearings; witness statements taken during the investigation;
· witnesses: depending on the nature of the complaint you may need to call people who saw what happened; the person who carried out the investigation; the person who chaired the disciplinary hearing and took the decision to dismiss; the person who chaired the appeal hearing.

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Although these FAQs highlight some key issues relating to employment law, it should not be considered comprehensive and is not a substitute for seeking professional advice on a specific issue.

Disclaimer

Although we have made every effort to ensure that the information contained in these FAQs is accurate, Business Hotline Publications and the named experts disclaim any liability for any errors or omissions.