Don't be too quick to dismiss

When it comes to employee misconduct, employers are often caught up in the emotion and quick to infer guilt. In their haste they fail to get a second opinion or take the time to undertake an objective and unbiased analysis of the circumstances. The consequences are such that the grounds for dismissing an employee may be unfounded, or that a dismissal- which otherwise would be sound and defensible- is rendered unfair due to procedural deficiencies.

The recent case of Jennifer Walker v Salvation Army (NSM)Property Trust t/as The Salvation Army- Salvos Stores[1] demonstrates the circumstance where an employer’s failure to properly investigate an allegation of theft led to the dismissal of an employee with no valid reason.


In this case a Store Manager was terminated for misconduct after she allegedly stole $200 in cash from the employer, the Salvation Army. More specifically, it was alleged that the manager had pocketed the $200 cash from a customer, rather than processing the sale through the cash register. The incident was brought to the attention of the Area Manager after the customer returned to the store to collect the “purchased” items with a delivery docket and a hand written note instead of a cash receipt.

The Area Manager subsequently commenced an investigation into the conduct and obtained CCTV footage from the store. The video footage revealed the Store Manager showing the customer around the storeroom with money - purportedly $200- in her hand, and later placing the money in her apron pocket.

The Store Manager, who had been employed for 11 years and had no previous disciplinary history, contended that she had not accepted any money from the customer and instead claimed that she had put the items on hold for the customer. At first instance, having not been able to view the CCTV footage, the store manager denied holding any money. However, post dismissal and after viewing the CCTV footage clearly, the Store Manager accepted that she had placed a $50 note into her apron in relation to a delivery payment for another customer.

At the hearing the Salvation Army argued that “the inferences [drawn] strongly support the [Salvation Army’s] versions of events compared to the [Store Manager]”. Such inferences included the fact that CCTV footage showed the store manager with $50 cash after having shown the items to the customer, and that she issued the customer with a delivery receipt despite no sale being processed.


In noting the lack of direct evidence, Senior Deputy President Hamberger commented that the Salvation Army sought to rely on “indirect inferences”. However, Senior Deputy President Hamberger determined that the evidence at its “highest” showed the store manager place the $50 note in her apron.

Senior Deputy President Hamberger criticised Salvation Army’s investigation process, commenting that “at the very least” the store manager should have provided with a better opportunity to review the footage and provide her own explanation of the incident.

In finding that the dismissal was unfair, Senior Deputy President Hamberger considered the criteria in section 392 of the Fair Work Act 2009 and awarded the Store Manager the maximum available compensation of twenty six weeks pay equating to $22,404.50.


The investigation undertaken by the Salvation Army serves as a cautionary example to employers when addressing allegations of misconduct. In particular, when conducting a workplace disciplinary investigation, employers should undertake the following:

  • Ensure that the employee(s) are provided with a meaningful opportunity to respond to the allegations. This entails providing the employee with sufficient details of the alleged conduct in writing. In the instance of CCTV footage, ensure that the employee(s) are permitted to view the footage prior to providing a response.
  • Genuinely consider contrary or alternative explanations for the alleged conduct, and approach any nominated witnesses.
  • Consider any mitigating circumstances prior to determining the appropriate disciplinary action to take, including the length of service or employment record of the employee(s);
  • Ensure impartiality and avoid making assumptions of guilt prior to the completion of a fair and thorough investigation;
  • Provide the employee(s) with the opportunity to have a support person present, including providing the employee(s) with sufficient opportunity to find an appropriate support person; and
  • When in doubt, slow down a little and seek a second opinion before terminating.

[1] [2017] FWC 32.


Marc Smith and Kim Hodge are from Hodge & Smith, employment law and human resources consultants. 

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