What is a fair and reasonable decision?

by | Sep 4, 2023 | Disciplinary & Dismissal

Employment law is littered with the requirement to make “fair and reasonable” decisions, but what does that mean?  In this month’s webinar I will be talking in more detail about how to reach a decision that would be considered “fair and reasonable”.

Legislation doesn’t define “fair and reasonable”, the closest we get is the “duty of good faith” (ERA Section 4) and the test of “test of justification” (ERA Section 103 A) which states ”The test is whether the employer’s actions, and how the employer acted, were what a fair and reasonable employer could have done in all the circumstances at the time the dismissal or action occurred

This goes on to define that the employer must:

  1. Investigate the allegations.
  2. Raise the concerns with the employee
  3. Give the employee opportunity to respond
  4. Genuinely consider the employees explanation

Investigation of allegations

Criminal law requires that you “prove beyond reasonable doubt”, employment law does not require such a high level of proof, you need to make decisions based on fair and reasonable assumptions.  So, in practical terms, you don’t have to have a video of A N Other taking $100 out of the till, but if (for example) A N Other had access to the till, had been complaining about lack of money, and was acting oddly/defensively when asked about the missing $100, it is potentially fair and reasonable to conclude that, on the balance of probabilities A N Other did take the $100.

However, the requirement to investigation means that, even though A N Other had been asking for an advance on their wages, you still need investigate whether the other 5 people who had access to the till make have taken the money.  Don’t just presume A N Other is guilty without considering alternative explanations.

Raising the concerns

Another way of looking at this was “did the employee know the consequences of their actions?”.  Throwing a punch, coming to work drunk etc are all pretty obvious things that an employee would know where wrong.  However, if an employee has been (for example) turning up to work whenever they felt like for years, you can’t suddenly go into disciplinary action against them if you have now decided you need them to turn up on time.  In this situation, you need to reset the expectations, give them a level of opportunity to comply, and then take action if they are still ignoring the instructions.

Opportunity to respond

This is the disciplinary meeting.

Genuinely consider the explanation

30 years in HR has taught me that you need to keep an open mind, even the most apparently cut and dried situations can have a reasonable explanation…. For example, the punch that was thrown towards the person who was having an affair with their husband.  Does the employee who threw the punch deserve to be fired?

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