Sally is employed on a permanent basis with Company X as a cashier. She has worked there for 2 years. Company X is a food and beverage company that sells to the local community. Company X had a clearance sale and there was a special on their 2litre ice cream which was selling out fast. Sally had intentions of buying a 2litre ice cream but because they were so busy due to the clearance sale she had decided to put a 2litre ice cream aside for herself in the lunch room fridge that she was going to buy before they closed the shop. This goes against Company X policies which all employees are aware of. A manager of Company X visited the lunch room and found the 2litre ice cream left in the fridge and asked whose it was. When Sally indicated it is hers, the Manager asked for her purchase slip. Sally indicated she does not have one as yet as she planned to pay for it before they closed. The manager became very angry and said Sally wanted to steal the ice cream and is a thief. The manager asked her to leave her cash register, pack her belongings and leave the premises immediately and not return back to work again. She subsequently was fired without pay and no disciplinary hearing was held.

Question

Assignment Topic
In Labour Legislation, fairness in dismissals is determined by procedural and substantive fairness. Considering the above case scenario, critically argue the fairness OR unfairness of Sally’s dismissal by referring to applicable labour legislation.

In short and summarised align the information above with the information below as to how Sally's dissmissal was unfair

(1) A dismissal is unfair if it is not effected for a fair reason and in accordance with a fair procedure, even
if it complies with any notice period in a contract of employment or in legislation governing employment.
(Comment : this means that even if the employment contract contains wording like ‘this contract may be terminated
by either party for any reason recognized in law as being sufficient’, the employee may still not be dismissed until
proper and fair procedure has been followed.)
Whether or not a dismissal is for a fair reason is determined by the facts of the case, and the
appropriateness of dismissal as a penalty.
Whether or not the procedure is fair is determined by referring to the guidelines set out below.
(2) This Act recognises three grounds on which a termination of employment might be legitimate.
These are: the conduct of the employee, the capacity of the employee, and the operational requirements
of the employer's business.
(3) This Act provides that a dismissal is automatically unfair if the reason for the dismissal is one that
amounts to an infringement of the fundamental rights of employees and trade unions, or if the reason is
one of those listed in section 187 (of the Labour Relations Act.).
The reasons include participation in a lawful strike, intended or actual pregnancy and acts of
discrimination.
(4) In cases where the dismissal is not automatically unfair, the employer must show that the reason for
dismissal is a reason related to the employee's conduct or capacity, or is based on the operational
requirements of the business.
If the employer fails to do that, or fails to prove that the dismissal was effected in accordance with a fair
procedure, the dismissal is unfair

Answer 1

The case of Sally's dismissal from Company X raises significant concerns regarding both procedural and substantive fairness under applicable labor legislation. Here’s an argument outlining the unfairness of her dismissal in light of the principles provided:

Substantive Fairness

1. Lack of Fair Reason: For a dismissal to be deemed fair, it must be based on a valid and fair reason as outlined by the Labour Relations Act. In this case, while Sally's actions may be viewed as a breach of company policy - specifically, placing an ice cream aside in the fridge - this alone does not necessarily constitute conduct warranting dismissal. The intention to purchase the ice cream before the store closed suggests that her actions were not dishonest or deceitful in nature.

2. Proportionality of the Response: The penalty of dismissal must be proportional to the misconduct. Given that this was a first-time incident for Sally in a context where she had clearly expressed her intention to pay, termination appears to be an excessive response. Employers are generally expected to consider less severe disciplinary actions before resorting to dismissal, particularly when the employee has been with the company for two years without prior incidents.

Procedural Fairness

3. Failure to Follow Fair Procedure: The Labour Relations Act stipulates that employees are entitled to a fair procedure when faced with dismissal. In Sally's case, no disciplinary hearing was conducted prior to her termination, violating her right to a fair process. She was not provided an opportunity to explain her actions or defend herself against the accusations of theft before being dismissed.

4. Immediate Termination Without Investigation: The manager's immediate reaction to dismiss Sally without investigating the context of her actions indicates a lack of procedural fairness. Fair procedures typically require an investigation and a chance for the employee to respond. The absence of such procedures in this case constitutes a significant flaw in how the dismissal was managed.

Relevant Grounds for Dismissal

5. Grounds for Legitimate Dismissal: The Labour Relations Act recognizes three legitimate grounds for dismissal: employee conduct, employee capacity, or the employer's operational requirements. While Sally's conduct is being scrutinized, the response was not aligned with any of these grounds as the conduct was not inherently deceitful or harmful to the operational requirements of the business.

Conclusion

In light of these points, Sally’s dismissal by Company X appears to be fundamentally unfair. There was a lack of substantive justification for her immediate termination, particularly since her behavior did not constitute theft and was, in fact, a misunderstanding in the context of excessively busy store conditions. Furthermore, the absence of a fair procedure, specifically the lack of a disciplinary hearing or investigation into the circumstances, constitutes a breach of her rights as an employee. Thus, her dismissal fails to meet the standards of fairness set by labor legislation, and consequently, it should be deemed an unfair dismissal.