I have just heard that one of my employees has been arrested. What should I do?
Last month Coronation Street’s William Roache, the world’s longest serving soap star, was arrested and charged with two counts of rape. While employers may consider that these are unusual circumstances, which the average employer would not have to face, instances of criminal misdemeanors outside the workplace are in fact surprisingly common and raise a number of employment issues.
Each case needs to be considered carefully on its facts and therefore you should avoid a knee-jerk reaction. Bear in mind that as a matter of criminal law, the individual is not guilty until they have been charged and convicted. Having said this, if the allegation is serious and has made it into the public arena, you will need to act quickly and may also be under pressure from shareholders, the public or the media.
Consider the issues in detail and seek early legal advice. What the arrest is for and what the employee’s role is will be key issues to consider in determining the best course of action for the company and for the employee. You will need to consider some or all of the following.
Suspension
Consider whether it is appropriate to suspend the employee while the criminal investigation is ongoing. If the allegation is serious this will almost always be the case. You should confirm the terms of the suspension in writing and review these at regular intervals.
For example, if the criminal allegation is for fraud and the individual is a senior member of your accounts department, it would almost always be appropriate to suspend the employee immediately pending an internal and a criminal investigation. Conversely, if the allegation is one which involves poor judgment rather than serious criminal intent (such as recreational Class C drug possession) and which does not otherwise impact on the employment relationship, it may not be appropriate to suspend the employee. Each case must be considered on its facts.
Third parties
Consider very carefully any statements you make to third parties, such as the media, and take specialist advice about these. Unnecessary disclosure of information to the public by the company could result in a defamation or constructive unfair dismissal claim if the employee is subsequently acquitted or the charges are dropped.
Pay
If you suspend the employee but they are still able to work (i.e. they have not been remanded in custody) they should continue to receive their pay as normal.
However if the employee is remanded in custody pending a criminal trial (and you have not dismissed them) you do not need to pay them. This was confirmed by the Employment Appeal Tribunal in Burns v Santander UK Plc. Mr Burns, a branch manager for the Bank, was charged with several criminal offences. He was remanded in custody pending trial. The Bank kept Mr Burns’ job open but stopped his pay while he was on remand. Following his conviction and release from custody, the Bank placed him on paid suspension pending disciplinary proceedings, which led to his dismissal. Mr Burns brought a claim for unlawful deduction from wages for the period while he was on remand. The EAT confirmed that an employee remanded in custody pending a criminal trial (which led to his conviction) was not “unavoidably” prevented from working and was therefore not entitled to his pay. The EAT held that although Mr Burns “had not been convicted of any offence at the time of the Bank’s decision not to pay him, he had conducted himself in such a way that, according to the Judge in the Criminal Court, he should be deprived of his freedom and therefore deprived of his right to attend work”.
If an employee is not able to attend work because they are in police custody, the employer should determine whether it is reasonable to hold the job open while the criminal investigation is ongoing.
Disciplinary action?
Pending a criminal conviction it may be appropriate for the company to undertake it’s own investigation, in order to determine whether or not to proceed with disciplinary action. The ACAS Code states that “if an employee is charged with, or convicted of a criminal offence this is not normally in itself reason for disciplinary action. Consideration needs to be given to what effect the charge or conviction has on the employee’s suitability to do the job and their relationship with their employer, work colleagues and customers”.
You should consider what the employee is alleged to have done, and the terms of their contract as well as those of your disciplinary policy. Regardless of whether or not the employee is eventually convicted (or not) for the criminal allegation put to them, if their actions have otherwise brought the company into disrepute, or led to a breakdown in trust and confidence, disciplinary action may be necessary and appropriate. You may also consider that the employee’s actions constitute gross misconduct, with disciplinary action being appropriate on that basis.
If and when the employee is convicted the terms of the conviction itself could also constitute sufficient grounds for disciplinary action. For example if the employee receives a lengthy custodial sentence, or if a driver is banned from driving for a long period of time, dismissal may well be appropriate on the grounds that the employee is not able to carry out their role.
Dismissal
Clearly if the employee is convicted of a criminal offence the company may wish to consider dismissal. It will not always be reasonable to dismiss someone simply because they have been charged with a criminal offence (bearing in mind the provisions of the ACAS Code set out above).
A 2010 Tribunal case illustrates how a dismissal may be unfair, if the employer doesn’t properly assess the impact of the conviction on the employment relationship. In Towart v Tyne and Wear NHS Foundation Trust the Tribunal found that the employer failed to act reasonably in dismissing a care worker when it decided that his dismissal was inevitable, following his criminal conviction for possession of cannabis and an illegal firearm. The Tribunal found that the Trust failed to take into account mitigating circumstances, including that the firearm was only illegal due to a manufacturing fault (which Mr Towart was unaware of). The Trust failed to set out why it considered that the care of patients was compromised by the conviction and made unsubstantiated assertions that its reputation had been damaged.
Ideally the company’s disciplinary policy should give it the express right to dismiss in cases where the employee is convicted of a criminal offence. As outlined in Towart, the company should identify how the conviction could affect its reputation, or its relationships with its staff, customers or the public (or otherwise affect the employee’s suitability to continue to work for the company) in moving towards a dismissal. This may seem an obvious point, especially where the conviction is for a serious offence and the employee receives a lengthy sentence, but the need to identify a fair reason for the dismissal should not be overlooked.
Remember that even if the employee is convicted of a criminal offence and imprisoned, any dismissal will be unfair unless you have followed a fair process and identified a fair reason for the dismissal. This may cause some practical difficulties where the employee has been remanded in custody prior to the criminal trial and where it has not been possible to meet with them to undergo a disciplinary process. In such cases, it may be necessary to proceed with disciplinary action based on the available evidence.
About the Author
Emilie Bennetts, Associate, Charles Russell LLP
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