By Charles Power

When can you suspend an employee without pay? The short answer is – you can’t without a very carefully drafted contractual provision permitting this.

Without this provision, you are not entitled to suspend an employee without pay for alleged misconduct, even if that misconduct would justify summary dismissal. You can, however, suspend an employee on full pay for a limited period. In the case of a senior and highly skilled position, where it is implicit the employee would have the opportunity to exercise and develop their skills, a direction not to perform work indefinitely would be a breach of their employment contract and unlawful.

Where a serious allegation is made against an employee, and you genuinely believe the continued performance of duties by the employee is inconsistent with your interests, you can direct an employee not to perform work for a closed period during the course of an investigation into allegations of misconduct.

You have a duty to investigate or make enquiries into alleged employee misconduct (assuming the complaint is not manifestly vexatious) and to take all reasonable steps to provide a safe place of work. This is consistent with statutory work health and safety obligations and the term implied by law into employment contracts which requires employers to provide their employees with a safe place of work.

These issues were before the Federal Court in Avenia v Railway & Transport Health Fund Ltd (2017). The decision concerned a dentist suspended on full pay pending an investigation into complaints of alleged bullying behaviour.

The dentist refused to attend meetings scheduled as part of the investigation. The employer issued a notice requiring him to show cause why he should not be summarily dismissed for disobeying the directions to attend the investigation meetings.

An employee’s breach of duty will not allow summary termination unless the breach was sufficiently serious.

Generally, willful disobedience of a lawful and reasonable order by an employee will justify summary dismissal.

The Court concluded the employer had the right to terminate the dentist’s employment summarily for refusing to comply with reasonable and lawful directions to attend meetings.