Should I stay or should I go: employee suspended without pay later terminated due to absence from work

Employers can often find themselves in a difficult position when they are advised by an employee that they have been charged with a non-work related criminal offence and may be unable to attend for work.

In our previous blog, we suggested caution about acting too quickly in these situations and discussed the need for employers to consider the individual circumstances of employees and to seek legal advice before making any decisions about whether the employee should return to work or their continued future employment.

The legal system, however, can be a drawn out and lengthy process, and employers may be eager to act before criminal proceedings are finalised. In Lynch v Reward Supply Pty Ltd T/A Reward Hospitality [2018] FWC 969, the Fair Work Commission (FWC) reinstated an employee who was unfairly dismissed because of his absence from work pending the outcome of his criminal matter.

In May 2017, the employee was arrested on non-work related criminal charges and was held in custody until July 2017, when he was granted bail. When the employee was arrested, his partner notified the employer of his circumstances. The employer advised that the employee would be placed on leave without pay.

When the employee was granted bail, he advised the employer that he was ready to work and that he was going to defend the charges against him. The employer did not want the employee to return to work and suspended him without pay pending the outcome of the criminal charges.

However, in October 2017, the employer advised the employee that it was intending to terminate his employment because of his absence from work on unpaid leave for more than five months and asked him to”show cause” as to why his employment should not be terminated. The employer did not receive any response and accordingly terminated the employment, effective 31 October 2017.

This “show cause” letter was sent to the employee by regular post and email.  The employee argued he did not see the letter until November 2017 after the deadline and that the employer should have made contact with his partner when it did not hear from him.

The FWC held that the employee’s dismissal was harsh, unjustified and unreasonable. Commissioner Bissett held that the employee’s absence could not be a valid reason for dismissal – the employee was ready, willing and able to work and was only absent from work because the employer had suspended him without pay pending the outcome of the criminal proceedings. As there was no valid reason for the dismissal, it was held that the employee had not been notified of the reason for the dismissal.

Commissioner Bissett was also not satisfied that the employee had been given an opportunity to respond – as the letter was sent by regular post, the employee was not given enough time to respond. She commented that, at least, the letter should have been sent with some tracking and with priority.

The FWC made orders for the employee be reinstated to his position, dismissing the employer’s concerns that it needed to provide a safe workplace for employees. The FWC also noted that it was up to the employer whether to continue to suspend the employee without pay.

Lessons for employers

When employees are absent for an extended period of time due to non-work-related circumstances, it can create uncertainty for employers particularly in relation to staffing arrangements. However, where absences are approved, or are the result of a direction from the employer, such absence cannot be relied upon as a reason for termination of employment.  In this case, while the employer did not terminate the employee because of his non-work criminal charges, it did not have a valid reason to terminate his employment because of his authorised absence from work.

Shane Koelmeyer is a leading workplace relations lawyer and Director at Workplace Law. Workplace Law is a specialist law firm providing employers with legal advice, training and representation in all aspects of workplace relations, employment-related matters and WH&S.

02 9256 7500 |

Information provided in this blog is not legal advice and should not be relied upon as such. Workplace Law does not accept liability for any loss or damage arising from reliance on the content of this blog.

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