With Christmas just around the corner, the silly season is once again upon us. Company Christmas parties are a way to celebrate a year’s hard work and give recognition to employees and thanks to employers. The goodwill created by such events is undoubtedly beneficial to the employment relationship. However, while for the most part Christmas parties are a fun and carefree time, there is the potential for serious damage to the reputation of individuals as well as the company. Intoxication, aggression and inappropriate sexual behaviour are becoming a major issue when employees overindulge in the Christmas celebrations. This gives rise to the question: can an employee be dismissed for misconduct during and following a work function?
Many employees get caught in the trap of thinking that, because a Christmas party takes place off work premises and/or after work hours, this prevents employers from being able to take disciplinary action against employees for conduct occurring at Christmas functions. However, many employees wake up the following morning to find that that is not necessarily the case.
“Employers need to understand that there is a limit to how far their reach can be and that there are areas of employees’ private behaviour that are beyond scrutiny. “
The law has long established that misconduct outside of work hours can in fact justify dismissal provided there is a sufficient link between the misconduct and the work environment. If the employee’s misconduct occurs at a work function, establishing that link is not difficult because he or she attends the event in the capacity of an employee.
Whether an employee’s dismissal following his or her conduct at a work function was justifiable or not must be determined objectively by asking whether dismissal was “what a fair and reasonable employer could have done in all the circumstances at the time the dismissal occurred”. Where an employee’s conduct at a Christmas function is such that it impacts negatively on the employer’s business, conflicts with the employer’s duties or undermines the employer’s trust and confidence in the employee, it may provide the foundation for a dismissal. However, where an employer has set up the work function and allowed staff to become heavily intoxicated, there is a question as to whether a fair and reasonable employer would find it appropriate in the circumstances to dismiss the employee. In these circumstances, an employee should consider the extent to which they contributed to the problem by, for example, providing too much alcohol and insufficient controls.
The Australian Fair Work Commission shed light on this contentious issue in a recent decision in which they found that an employer unfairly dismissed a team leader who spent the night of his work Christmas function intimidating and sexually harassing colleagues and telling superiors to “f##k off”. In finding that the employee was unfairly dismissed, the Commission took into account that the behaviour was a result of his intoxication and stated that “it is contradictory and self-defeating for an employer to require compliance with its usual standards of behaviour at a function but at the same time allow the unlimited service of free alcohol. If alcohol is supplied in such a manner it becomes entirely predictable that some individuals will consume an excessive amount and behave inappropriately.” This decision suggested that, where employers provide unlimited service of free alcohol, this may be taken into account as a “mitigating factor”, with the consequence that the employer may not be able to reasonably hold employees to the same standard of conduct.
The Fair Work Commission’s decision may have widespread implications for the contentious issue of when an employee’s intoxicated conduct at a work function will justify dismissal.
Employers need to understand that there is a limit to how far their reach can be and that there are areas of employees’ private behaviour that are beyond scrutiny.
Where the misconduct occurs after the official work function has ended and outside the function premises, it will be more difficult to establish the necessary link between the misconduct and the work environment. The nexus to the work environment may be found to exist where the misconduct attracted publicity that reflected poorly on the company or made it difficult for the employee to credibly perform his or her role or where the victim of the misconduct was a client or a colleague.
Worryingly for employers, however, in a recent decision, the Fair Work Commission took the fairly narrow view that the employee’s misconduct outside of the event’s official hours and premises were not valid grounds for dismissal because that misconduct was not relevant to the employee’s relationship with the employer. The Commissioner considered the misconduct was not sufficiently connected to the employee’s employment as the interaction was not “in any sense organised, authorised, proposed or induced” by the employer and was “essentially a private social setting”.