Unfair Dismissal: De Arman v Soldiers Point Bowling Club

Take care when dismissing an employee summarily - De Arman v Soldiers Point Bowling Club [2012] FWA 7148 (21 August 2012)

A recent decision of Fair Work Australia has highlighted some of the potential difficulties that employers face when seeking to dismiss an employee summarily.  Summary dismissal means dismissal without notice and is usually effected by the immediate termination of an employee and their immediate departure from the workplace.  A summary dismissal may only be done in limited circumstances of immediate threat to the business including theft, fraud and physical violence.

The Applicant worked for the Respondent, the Soldiers Point Bowling Club, a club registered with Clubs NSW.  The Applicant was dismissed summarily on 17 February 2012 after allegations were raised concerning discrepancies in balancing the Change Box (or float).  This related, particularly, to two incidents.  The first incident occurred on 14 January 2012 and involved an unexplained end of day shortfall of almost $1000.  The second incident occurred on 8 February 2012 when $50 was found to be missing from a $5000 bundle of $50 notes in the club safe.  In both cases, the Applicant had worked in the change box area on the respective days.  In respect of the second incident, the Respondent club relied on CCTV footage showing the Applicant at the end of her shift placing a $5000 bundle at the bottom of a pile in the safe and place an alternative bundle into the change box.  The Applicant claimed that she did this to minimise the amount that the supervisor had to count and because she hadn't written this bundle down on the safe sheet.  Other employees confirmed that this occurred from time to time.  There was also CCTV footage showing the Applicant counting money.  The Respondent argued that this showed the 'disappearance' of $50.

Evidence was also led about the Respondent's cash handling practices.  This showed that

  • the change box area was not secure and could be accessed by a number of people (including substitute operators during meal breaks etc);
  • there were numerous variances arising from the club's Keno, TAB and poker machine areas and that the total variance was attributed to the change box operator at the end of each day;\
  • the club did not have any cash handling policies;
  • there was no system of tracking variances back to their source at the end of the day;
  • The findings of the Tribunal showed that the Respondent's cash handling procedures were not ideal.

At the meeting on 17 February 2012, the Applicant was supplied with a list showing that the number of variances occurring whilst she was change box operator were high compared to other staff.  Despite this, no evidence was led indicating that a report had been made to the police.  No specific allegation of theft was made.  The Respondent had not issued any warnings to the Applicant.  The Respondent had not undertaken any investigation of previous variances.

The Tribunal noted that, for summary dismissal, the standard of misconduct is necessarily high and should only occur in exceptional circumstances.  In essence, the Tribunal needs to be satisfied on the balance of probabilities that the Applicant 'did it', not just that the Respondent had a well-founded belief that the misconduct had occurred.

The Tribunal referred to Clause 1.07 of the Fair Work Regulations which defines 'serious misconduct', in particular that the conduct must include 'theft' or 'fraud'.  Commissioner Stanton noted that the video evidence was not conclusive and did not show the Applicant taking the $50.  The breach of the usual procedures involved in placing money in the safe was, at its highest only deserving of a warning and could not constitute misconduct.  The Tribunal also noted that the club waited for at least a week to investigate (and a month in relation to the previous incident).  The Tribunal noted the poor cash handling procedures and the manifest unfairness of visiting variances arising from the conduct of one operator upon a later operator.  This also invalidated the Respondent's arguments that the variances that the Respondent identified as being the responsibility of the Applicant could not support dismissal.  The Tribunal also expressed concern about the lack of procedural fairness shown by the Respondent.

The Tribunal ordered that the Applicant be reinstated and ordered that compensation be paid for the intervening period.

This case clearly demonstrates the need for a demonstrably strong case before an employer dismisses an employee.  The fact of well-founded suspicion is insufficient.  This case also demonstrates that concerns must be acted on immediately.  An allegation that is allowed to lapse for a month cannot then form the basis of a sustainable summary dismissal.

* PCC Lawyers are a team of employment practitioners based in Sydney, with many years of combined knowledge and experience in workplace law, industrial relations, workplace investigations and training.  They provide a high standard of excellence and an exceptional level of personal service to a variety of clients in the Sydney metropolitan area, Central Coast, regional NSW and interstate.


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