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Error riddled workplace investigation causes unfair sacking verdict

workplace investigation that was substantially and procedurally unfair recently unravelled before the Fair Work Commission[1].

With a flawed methodology and significant defects, even a dedicated HR team were unable to retrieve the investigation from the brink of disaster.

However, despite all this, the employer still felt confident enough to sack its employee after 25 years of unblemished service.


Concerned about allegations of illegal activity amongst staff, the employer engaged a private investigator firm, LKA, to go “undercover” as an employee at the employer’s workplace and report back on any findings concerning criminal behaviour.

When it became apparent that LKA would be unable to complete the brief, its investigator took it upon himself to start reporting back to the employer on other matters pertaining to staff, outside the parameters of what he was originally engaged to do.

The employer allowed the investigator to continue the covert surveillance.

In particular LKA reported on the actions of a supervisor, Mr Leyshan, over a 6 week period.

The Allegations

LKA’s final report to the employer contained a number of allegations relating to Mr Leyshan’s performance and conduct over this period.

Upon receiving the report, the employer invited Mr Leyshan to attend a meeting in February to discuss the allegations including:

  • Stating to a subordinate words to the effect that he did “not care what they did, just don’t get caught, don’t make me have to explain why you are doing nothing”; and
  • Not effectively monitoring and supervising the work output of a subordinate.

Following the meeting and despite tabling written responses denying the allegations, the employee was summarily dismissed for deliberate and wilful misconduct.

In a letter confirming his dismissal, a third reason was put forward – breaching the employer’s Procurement Policy.

The Decision

According to the Fair Work Commission, the employer’s workplace investigation contained significant defects, rendering it substantially and procedurally unfair. As such, Mr Leyshan’s dismissal was also unfair.

No valid reason

In relation to the allegations put forward by the employer and LKA’s report, the Commission found that at least one of the allegations was not substantiated and that the remaining two allegations were not serious enough to constitute a valid reason for Mr Leyshan’s dismissal.

Not notified of the reason

At the February meeting, Mr Leyshan was provided with a detailed and specific memorandum outlining a number of the allegations.

However these allegations were then “rolled up” into one dismissal letter that failed to provide clarity as to what specific allegations were made out and relied upon for his dismissal.

Other procedural issues

Given the conflict between the LKA report and Mr Leyshan’s denials of the allegations, it was incumbent on the employer to conduct its own investigation into the circumstances of the allegations, including ascertaining further witnesses, and following up on Mr Leyshan’s written responses.

Instead, the written response was not taken into consideration when he was dismissed. There was no apparent attempt by the employer to conduct its own investigation.

The employer took LKA’s report at face value, placing “unquestioning and uncritical reliance” on the allegations within.

In doing so, the employer failed to follow its own Conduct and Performance Management policy.

Further, Mr Leyshan had not once been warned of any issues with his conduct or performance in his role and there was differential treatment of other supervisors for seemingly similar failures to supervise subordinates.

On the surface, the employer’s conduct had the appearance of procedural fairness, but it was not fair in substance and Mr Leyshan’s dismissal was harsh, unjust and unreasonable.

The Commission ordered the employee to be reinstated.

Lessons for Employers

For this employer, a number of clearly avoidable mistakes was its undoing before the FWC.

As a result the employer was ordered to reinstate an employee who, in its view, was accused of “awful and deliberate behaviour”.

The employer gave itself little capacity to genuinely consider the alleged wrongdoer’s responses to allegations of misconduct and failed to adequately deal with apparent conflicts in evidence.

Critical reliance on a third party investigation report, with no apparent attempt to ascertain it’s own version of events, clinched the unravelling of its disciplinary procedures.

[1] Leyshan v Wyndham City Council [2013] FWC 7094 (14 October 2013)

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