Are your workplace policies actually enforceable?
Employers should ensure that workplace policies are readily accessible, explicit and within the scope of employee's contractual obligations. That is the key message from a recent decision of the Employment Relations Authority.
Background
In Lummis v The Shawz Group 2019 Limited, the Authority considered a claim of unjustifiable dismissal by a former supermarket employee. The employee (“Lummis”) dyed her hair blue. In response, her employer (“Shawz”) told her that she needed to wear a hat while at work. When Lummis forgot to bring a hat to one of her shifts, she was told by Shawz that her actions constituted serious misconduct. Investigative and disciplinary processes were undertaken, during which the parties disagreed about whether a set of workplace ‘House Rules’ required Lummis to cover her dyed hair upon Shawz’s request. Lummis was eventually summarily dismissed for serious misconduct.
The Authority’s Decision
The Authority confirmed that, in general, an employee’s failure to follow a lawful and reasonable order from their employer can amount to an action that justifies disciplinary action. However, the employer needs to demonstrate that it has issued a “lawful and reasonable” order. Orders are “lawful and reasonable” if they:
- do not require the employee to perform any act contrary to law;
- are within the scope of the employee’s contractual obligations; and
- do not demand the performance of any impossible or dangerous task.
In the present case, the Authority had no trouble finding that Shawz’s direction that Lummis cover her hair with a hat was neither contrary to law nor impossible or dangerous.
At issue was whether the direction was within the scope of Lummis’ contractual obligations. Shawz argued it was common knowledge that coloured hair had to be covered. Reference was also made to a 2018 set of House Rules, under which Shawz had “…the discretion to decide what is and is not appropriate work wear if your choices are considered controversial”.
However, the Authority accepted that Lummis was not aware of any such “common knowledge” and found that the 2018 House Rules did not require staff to cover dyed hair. Accordingly, Shawz’s direction that Lummis wear a hat while at work was not within the scope of her contractual obligations and the direction was not “lawful and reasonable”.
The Authority also found that there were deficiencies in the dismissal process Shawz undertook. In particular, the Authority said that Shawz had failed to genuinely consider Lummis’ response to the direction that she wear a hat (Lummis did not believe she was required to do so). The Authority suggested that Lummis’ response should have given Shawz pause to consider whether it had correctly interpreted the House Rules. Shawz failure to do so rendered Lummis’ dismissal procedurally unjustifiable.
Comment
The Authority’s decision is certainly thought-provoking. As employment law practitioners, we are constantly drafting and reviewing both employment agreements and workplace policies. Many of these documents contain broad provisions empowering employers to dictate employees’ dress and appearance, similar to the clause in Shawz’s House Rules above. The Authority’s decision suggests that these provisions may be insufficiently precise and employers might not be able to rely on the general discretionary powers such provisions supposedly provide.
To avoid ambiguity, workplace policies should be:
- written;
- made available to staff; and
- contain clear, explicit provisions about what employees are and aren’t entitled to do and the possible consequences if employees fail to follow these rules.
In Shawz’s case, the Authority may have found differently if the House Rules had explicitly stated that staff were required to cover dyed hair when working. While this may seem like a pedantic step in light of the existing clause that Shawz sought, in part, to rely on, to justify Lummis’ dismissal, the $10,000 award made against Shawz for unjustifiable dismissal should motivate other employers to ensure they have sufficiently robust workplace policies in place before taking disciplinary action against employees who may be in breach of them.
Employers who want expert advice on workplace policies and handling employee disciplinary issues should contact Jaesen or Jordan.