Misconduct v gross misconduct – why does it matter?

Misconduct is one of the five potentially fair reasons an employer must have to dismiss an employee fairly. In this context, misconduct usually refers to two types of improper or unacceptable behaviour – ordinary misconduct and gross misconduct.

Gross misconduct implies a higher degree of misbehaviour than ordinary misconduct. It is described by the ACAS Code of Practice on Disciplinary and Grievance Procedures (the Code) as being an act that is so serious or having such serious consequences that it may call for dismissal without notice for a first offence, obvious examples being theft or violence. Subsequent case law has clarified that dismissal in these circumstances is warranted because the conduct so completely undermines the relationship of trust and confidence between employer and employee that the employer should no longer be required to retain the employee.

The key difference therefore is that an employer may fairly dismiss an employee immediately, without notice pay and prior warnings, in the case of gross misconduct. Conversely an employer will usually only be able to fairly dismiss an employee for ordinary misconduct where it has issued the employee with previous warnings and where it has provided the individual with notice or payment in lieu of notice.

What constitutes gross misconduct?

In light of the very serious consequences for an employee who is dismissed for gross misconduct, employment tribunals have often made findings of unfair dismissal and/or wrongful dismissal (that is, requiring employers to pay employees in lieu of unpaid notice) where the tribunal considers that an offence has been categorised incorrectly as gross misconduct.

When considering whether conduct should be characterised as gross misconduct, employers should take care and consider the following principles:

1. For conduct to be gross misconduct, it must be so serious that it goes to the root of the contract; that is, the conduct must amount to a fundamental breach of the express or implied terms of the contract, thereby entitling the employer to dismiss with immediate effect. For example, an employee who dishonestly claims to be ill in bed when they are in fact working in another job is likely to commit such an act.

2. The conduct must be a deliberate and wilful breach of the contract or amount to gross negligence (that is a really serious failure to achieve the standard of skill and care objectively to be expected from an individual of the grade and experience of the particular employee). Gross negligence is less common in practice but could include a manager of a care home failing to monitor a resident’s blood sugar levels if they were known to be diabetic.

3. A pattern of conduct may potentially be sufficiently serious to undermine the relationship of trust and confidence, and therefore amount to gross misconduct, even though there is no single act which itself could be deemed gross misconduct.
   
   

In reality, different employers will take different approaches to whether or not something constitutes gross misconduct. For example, an organisation carrying out manufacturing activities may well regard a breach of its health and safety policy as gross misconduct, whereas an office-based organisation may not. Equally, swearing may be considered a more serious offence in the hospitality sector than say on a construction site.

Ultimately, what acts or omissions will amount to gross misconduct is a mixed question of fact and law. The Code’s examples of gross misconduct include:

• fraud,
• theft,
• physical violence and
• gross negligence.
  
  

However, the Code recognises that the precise circumstances that will amount to gross misconduct will vary depending on the nature of a particular employer’s organisation and what it does. For example, the Northern Ireland Industrial Tribunal found that a dismissal for gross misconduct of an employee who had eaten a bag of nuts at his desk was fair in the circumstances of that particular case because the employee worked in an open plan office and sat next to a colleague who had a severe nut allergy as a result of which the employer had made it clear that employees were not to eat nuts at their desks or in the office.

Practical tips

1. Employers should give thorough consideration to the acts and omissions it considers will amount to gross misconduct, having regard to the principles outlined above and other internal and external factors (such as industry standards and the organisation’s work). It should then include these as non-exhaustive examples of gross misconduct in it’s staff handbook or disciplinary procedures/rules.

2. However, employers should not be tempted to rely solely on the fact that a particular act or omission is identified as an example of gross misconduct in its policies to determine that the act/omission always amounts to gross misconduct. Listing such examples may make it more likely that a tribunal will find a summary dismissal for these offences fair, but the tribunal will still consider whether a fair procedure was followed and whether the dismissal fell within the band of reasonable responses. For example, case law has shown that an employee’s breach of the employer’s policy did not necessarily amount to gross misconduct simply because the disciplinary code stated that it would – what the employee had done could not reasonably be characterised as either deliberate wrongdoing or gross negligence and therefore did not amount to gross misconduct.

3. Employers should therefore ensure that a reasonable investigation into the seriousness of the offence is carried out and that any disciplinary procedure it has in place is followed. Disciplinary and appeal managers should take into account the particular employment and employee when deciding whether an act is gross misconduct and should record (in writing) the reasons why they consider that the offence amounts to gross misconduct and why dismissal is the appropriate sanction (having regard to mitigating circumstances and alternatives to dismissal).