Don’t let your letters come back to bite you
Are you writing letters that might be used by employees against you in court? The judgment in the recent case of Thomas v MWS Pty Ltd  FWC 62 demonstrates that a poorly worded letter can be fatal to defending a decision to dismiss an employee.
The Applicant, Mr Jason Thomas, refused to sign a new contract of employment when it was offered to him at the end of 2017. The new contract contained inferior terms and conditions.
Mr Thomas was dismissed from MWS Pty Ltd (MWS) in February 2018 after he took home bottles of Jim Beam, Jack Daniels and Johnnie Walker. Mr Thomas contended that the alcohol had been abandoned as it had sat with other opened bottles in a mouldy esky for three months before MWS directed that the contents of the esky be thrown out. Mr Thomas had taken the three bottles when he spotted them as the contents of the esky were being thrown into an external dumpster.
MWS subsequently claimed that Mr Thomas had stolen company property. He was sent a letter asking him to “show-cause” why he should not be terminated. The show-cause letter:
- suspended Mr Thomas and invited him to respond to the allegations of theft;
- included the words “our client relies upon your theft of company property as the basis of the termination”; and
- referred to the refusal to sign a new contract at the end of 2017.
The show-cause letter asked for Mr Thomas to return company property and equipment but did not ask for the bottles of alcohol to be returned. Mr Thomas responded to the show-cause letter both in writing and at a meeting. He emphasised that he had not been stealing, but was taking goods he understood to have been abandoned. Nevertheless, he admitted that he had taken the bottles and was contrite. MWS dismissed him with immediate effect at the end of the show-cause process. Mr Thomas then applied to the Fair Work Commission, claiming that he was unfairly dismissed.
The Fair Work Commission agreed that Mr Thomas had been unfairly dismissed. MWS was ordered to reinstate Mr Thomas (who earned $135,000 per year) as well as pay him wages lost as a result of the dismissal.
Deputy President Sams did not agree that there had been any theft. His Honour determined that if MWS really considered work property had been stolen, they would have asked for compensation or return of the bottles. DP Sams noted that the more likely reason for termination was the refusal to sign the inferior contract. He stated: “Why would there be any reference in the ‘show cause’ letter to his refusal to sign a new contract, if it did not figure at all in Mr Edwards’ thinking?”
DP Sams also found that MWS had made the decision to dismiss Mr Thomas at the time of sending the show-cause letter (not at the end of the process) and that the employer “just went through the motions”. This was evident from the statement “our client relies upon your theft of company property as the basis of the termination” as well as the demand he return company property at that time.
DP Sams concluded the dismissal was harsh, unjust and unreasonable as well as both substantively and procedurally unfair.
This case emphasises the importance of a well drafted letter when addressing employee concerns (and especially letters that are inviting employees to tell you why you should not dismiss them).
Handy hints include:
- don’t exaggerate the magnitude of the conduct in question;
- present the employee with enough information to genuinely understand the organisation’s concerns and what they are being asked to respond to;
- make sure that the organisation’s behaviour demonstrates that it genuinely holds the concern that it is raising (e.g. asking for stolen property back or if the misconduct that is being raised is illegal, calling the Police);
- do not mention irrelevant matters (a court or tribunal might assume they impacted decision-making in some way); and
- emphasise that you have not made a decision (and will not do so until you have considered the employee’s response to the concerns you are raising).
If you are considering terminating an employee’s employment, our Employment Relations Specialists can advise you and assist with drafting letters, including show-cause letters. Contact CCER on 9390 5255 or email us at email@example.com.
Rita Bhattacharya is an Employment Relations Specialist at CCER.