Issues for employers when employees are charged with criminal offences

When an employee is charged with a criminal offence outside of work an employer may be concerned about risks to their staff, customers and damage to their business. This must be balanced with the employee’s rights to the presumption of innocence and to their right to respect for private and family life.

Should the Employer bring disciplinary proceedings?

Certain types of off duty conduct have no bearing on employment and may not justify disciplinary action. An employer must be able to establish it has some impact on working relationships, customer relationships, suitability for the role, or is likely to cause reputational damage to the employer’s business.

An employer should not automatically proceed with disciplinary action. An employer needs to be careful that starting their own investigation or disciplinary process will not prejudice any ongoing criminal investigation or proceedings. Also, an employee may be legally advised not to respond to any questions in an investigatory meeting in case this will prejudice a criminal investigation or trial.

While an employer is not prevented from taking disciplinary action, they will need to consider the circumstances of each case and whether it is appropriate to suspend the employee while they await the outcome.

If suspended, the employee will in most circumstances be on full pay and an employer will not want this to continue long-term. Criminal proceedings can take months depending on the nature of the offence and the jurisdiction. Employers should consider whether suspension is appropriate in the circumstances, or if temporarily an employee’s duties can be amended or the employee deployed to another part of the business.

If an employer decides there may be grounds for disciplinary proceedings, they will need to investigate the facts and then decide whether to proceed with disciplinary proceedings.

Reason for dismissal

Provided the employee has two years’ service with their employer; to fairly dismiss an employee, an employer must act in accordance with Section 98 of the Employment Rights Act 1996 (ERA).

An employer will have to establish the reason for the dismissal and that it is a potentially fair reason within Section 98 (2), or is for “some other substantial reason” (SOSR) of a kind such as to justify the dismissal.

Once the reason is established under Section 98 (4) of ERA 1996, the Tribunal then must be satisfied that the reason for the dismissal was fair in the circumstances having regard to the reason shown by the employer and the size and administrative resources of the employer’s undertaking in accordance with equity and the substantial merits of the case.

If the reason for the dismissal is conduct, then Employer will have to satisfy the so-called Burchell Test and hold a genuine belief in guilt based on reasonable investigation (British Home Stores Ltd v Burchell [1980] I.C.R. 303, [1978] 7 WLUK).

Alternatively – and this is often used where the alleged criminal behaviour occurs outside of the employment – the employer may seek to rely on SOSR for fairly dismissing an employee in circumstances where the employee is accused or convicted of a crime. If relying on SOSR, an employer will have to show the SOSR was the principal reason for dismissal justifying dismissal of the employee holding the job in question.

An employer cannot simply dismiss for reputational reasons because an employee is charged with an offence. They will have to carry out reasonable investigation, follow a proper procedure and show a connection between the alleged offence and a breach of the implied term of trust and confidence, a genuine risk of reputational damage to the business or actual loss of business by the employer because of the employee’s criminal charge or conviction.

If, for example, an employee can no longer perform their role due to a criminal charge or conviction, the inability of the employee to perform their role may constitute a “substantial reason” entitling the employer to dismiss. However, this will not be automatic, and an employer should explore other employment options before deciding to dismiss.

Relevant case law

In the case of Ali v Sovereign Buses (London) Ltd UKEAT/0274/06 the EAT held the dismissal to be unfair and reviewed the various authorities on whether an employer should wait for the outcome of criminal proceedings.

Mr Ali was a bus driver who was accused of arson after the bus he had been driving went on fire. At his investigatory meeting he refused to answer any questions on the advice of his solicitor, and he also declined to attend two disciplinary meetings. The employer refused to postpone the disciplinary hearing until after his trial and dismissed him for failing to safeguard company property. He appealed and attended his appeal but did not answer any questions and the appeal was dismissed.

The EAT held that where conduct was the issue the employer had to meet the Burchell test and in this case the Tribunal had not properly considered whether a reasonable investigation had been carried out. This respondent’s witness stated in his evidence that at the time of the dismissal several key questions remained unanswered.

Further the Tribunal had failed to consider the relevant factors as to whether a reasonable employer would have delayed the disciplinary until the outcome of the trial which were:

• The length of time before the trial and the cost to the employer of retained the employee until then
• Whether the employer had afforded the employee the opportunity of giving his explanation and made him aware that dismissal was being contemplated
• The strength of the employer’s investigation material

Mr Ali was acquitted of the charge a year later but of course it is the information available at the time of the dismissal that is relevant.

In the case of Harvie v The Scottish Ambulance Board 2023 WL 08099059 the dismissal was also found to be unfair as the employer refused to postpone the disciplinary hearing.

Mr Harvie was accused of assaulting a member of the public, but he claimed to have acted in self-defence. He was summarily dismissed for gross misconduct for assaulting a member of the public who he claimed was intoxicated and acting aggressively towards him. He stated he believed the individual was going to head butt him, so he struck him on the chin.

He sought a postponement of the disciplinary hearing until after his trial which was due within 3 months. He was denied an extension of time to obtain CCTV footage.

The Tribunal held the dismissal was out with the band of reasonableness as the evidence before the disciplinary panel was not full and fair. The Tribunal concluded that a reasonable employer would have waited for the conclusion of the criminal case which was a short while before deciding on dismissal.

In summary

While criminal conduct occurring within work can be categorised fairly readily as gross misconduct and thus can be dealt with via an employer’s disciplinary procedure, it is often difficult for an employer to know what to do when an employee has been charged with a criminal offence relating to their conduct outside of work. Advice should be sought because at first sight it may seem straightforward but as can be seen from the above cases whether a decision to dismiss is likely to be fair is fact specific to the business and the individual’s circumstances.