Employee dismissed over $101.70 in charges to company coffee account
The Fair Work Commission considered the gravity of financial misconduct in its recent decision, despite the financial cost being trivial in nature.
Financial misconduct committed by an employee can fundamentally damage the trust and confidence in an employment relationship. Unfortunately, financial misconduct is a common issue for Australian businesses and if it is not dealt with promptly and effectively, there is an opportunity for further misadventure.
The Fair Work Commission (FWC) considered the gravity of financial misconduct in a recent decision. While the financial misconduct was trivial in nature, the FWC considered it to strike at the core of the employment relationship and that therefore, there was a valid reason for dismissal.
In the case, the employee was employed by Credit Union Australia as a full-time customer service specialist at one of its branches.
The branch had a practice of allowing employees to purchase beverages at a nearby café for customers who were in the branch for a longer period of time. The charge would be made on the company coffee account which was to be used only for business purposes.
In June 2020, the branch manager noticed unusual amounts had been charged to the company coffee account. The branch manager made enquiries with the café manager who specifically named the employee and one of her colleagues to have made the purchases and commented — “I warned them, I told them they would get caught”.
The branch manager subsequently commenced an investigation into the discrepancies on the company’s coffee account and formed the view that the amounts invoiced between March 2020 and April 2020 appeared high considering there was a large COVID-19 shut-down period, which resulted in a lower number of customers visiting the branch.
The employer put allegations to the employee that she had misused the company coffee account to pay for 24 coffees for her personal consumption, valued at $101.70. The employee denied using the employer account for anything other than business purposes, except for one instance where she admitted to charging the account because the barista made the incorrect coffee and she gave it to a colleague.
The employer found the allegations were substantiated and commenced a disciplinary process against the employee. The employer alleged that the employee engaged in conduct which was in breach of their fraud and ethics and integrity policy and invited her to show cause as to why her employment should not be terminated.
The employee disputed the allegations and provided in response that the transactions were not for her personal coffee as she preferred to drink piccolo lattes (which was distinct to the regular coffees charged to the account), that the members continued to visit the branch during the COVID-19 shutdown and that she would offer coffees to the members being served and those waiting outside due to capacity limits.
The employer found that based on the investigation findings, the allegations were substantiated and the employee’s conduct constituted theft and serious misconduct. The employer therefore terminated the employee’s employment but provided her with four weeks’ notice in lieu.
Unfair dismissal claim
Seeking reinstatement, the employee made an application for an unfair dismissal remedy alleging that she had been unfairly dismissed. The employee submitted that her termination was harsh, unjust and unreasonable because the employer did not afford proper weight to her evidence or statements.
The employer maintained that the employee consistently provided inconsistent statements in that she only occasionally attended the café to purchase her preferred piccolo latte, but her bank statements and witness statements suggested otherwise.
The employer submitted that the employee’s dishonesty during the investigation process elevated the seriousness of her misconduct and eroded the trust and confidence necessary for the continuation of the employment relationship.
In reaching its decision, the FWC had regard to a number of conflicting witness statements provided as evidence.
The FWC accepted the café manager’s evidence that she had previously warned the employee and her colleague that their coffee consumption on the company’s coffee account would eventually be known given the significant downturn in business.
In considering the conflict surrounding the employee’s coffee consumption, the FWC rejected the employee’s claim that she only drank piccolo lattes as this directly contradicted her bank statements, which showed that she was regularly charged more than the standard price of a piccolo latte.
The FWC also rejected any suggestion by the employee that the café manager had an ulterior motive in accusing the employee of misusing the company coffee account and that the café manager falsely charged coffees to the account.
The FWC found the employee provided untruthful evidence in an attempt to clear her name in the financial industry and therefore she was not a credible witness. The FWC held that the employee had a “cavalier attitude to the coffee account” and that on the balance of probabilities, she had jointly misused the account and this justified termination.
The FWC stated that the employee’s conduct struck “at the heart of her duties” to the employer to be honest in all transactions involving the use of company funds. The FWC held that working in the financial industry required a high level of integrity and that the industry cannot afford to have an employee be untruthful over transactions.
Accordingly, the FWC was satisfied that there was a valid reason for dismissal given the conduct of the employee, the employee’s untruthful statements and the nature of the financial industry requiring a high level of honesty.
In finding that the employee had engaged in serious misconduct, the FWC did not find the dismissal to be harsh, unjust or unreasonable and therefore dismissed the employee’s application.
Lessons for employers
Conduct that strikes at the heart of the employment relationship inevitably causes loss of trust and confidence in the employee. Employers would expect a high level of trust and integrity from employees especially in positions that require them to handle money, such as cashiers and those working in financial positions.
Employers must ensure that their policies are up to date to prevent employee financial misconduct, including clearly setting out that company accounts and company property may not be used for personal use.
This article was first published on the Workplace Law website. Information provided in this article is not legal advice and should not be relied upon as such.
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