1 min read

Breach of Small Business Fair Dismissal Code

The Case

Elton v Acupuncture Australia Pty Ltd (2015)

Ms Elton was summarily dismissed from her employment with Acupuncture Australia. The employer alleged that Ms Elton had engaged in theft and fraud, claiming that:

  • an increase in deleted receipts from the cash book demonstrated the fraud; and
  • a drop in quarterly average sales established that Ms Elton had been involved in theft.

The employer confronted Ms Elton and told her that if she admitted to the theft and fraud, she could keep her job; otherwise the employer would report the matter to the police and terminate her employment. Ms Elton denied the allegations and was summarily dismissed. Ms Elton commenced unfair dismissal proceedings.

The Verdict

The Fair Work Commission (FWC) found that the employer had unfairly dismissed Ms Elton because it had provided no substantial proof of the alleged theft or fraud.

A downturn in sales was not sufficient proof of theft, and an increase in deleted receipts could have been for another reason, such as a new employee getting used to the system.

The FWC found that the employer’s conduct was “appalling” and that there was no evidence of misconduct. The FWC awarded the employee $29,070 in compensation.

The Lesson

To summarily dismiss an employee, you must have convincing evidence of misconduct that will stand up to the scrutiny of a court. All the evidence must be closely examined before a decision is made to dismiss.

If you are unsure whether or not you have enough evidence to terminate an employee, you should seek advice prior to terminating their employment. As this case shows, it can cost you a lot of money if you get it wrong.

Please note: Case law is reported as correct and current at time of publishing. Be aware that cases in lower courts may be appealed and decisions subsequently overturned.

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