Really appreciate your bulletins, just wondered whether you could answer my question, last week I discovered that one of our employees, who is a key holder, has been entering the premises and taking equipment to use on jobs that he is doing in his own time.

I have checked his contract, which is quite short only a few pages, but there is nothing in it which helps. I have been thinking of updating our employment contracts for some time but never actually get around to it.

What should I do, can I discipline him?

It appears that you have a number of issues. The first issue is the employment contract which you have identified needs to be updated. The RML Employment Contract and Handbook has been written specifically for the motor industry, so your contract of ‘only a few pages’ is probably not sufficient and ripe for updating.

However this situation is easily remedied, RML can supply Employment Contracts including the Employee Handbook with all your employee’s details already printed in the contracts. All you have to do is provide your employee details and we will create the contracts for you to print and issue to your employee.

This service is extremely reasonable and will save you a lot of time and remove one of the jobs you have been hoping to get around to doing.

The cost of the Employment Contracts and Handbook (exclusive of VAT) is £200 for 10 or less employees, and then an additional charge of £15 for every employee in excess of 10.

EThis email address is being protected from spambots. You need JavaScript enabled to view it. Tracey to update your contract. 

Returning to the problem with your employee the first place to look for guidance, as you have identified, is the employment contract and handbook unfortunately you have discovered that this does not assist you. If your contract is silent then the matter become less ‘black and white’ and a lot more ‘grey’.

It is easy to miss detail and find yourself in a tribunal if in doubt contact the RML helpline if you subscribe to our service.

There are a number of terms ‘implied’ into a contract of employment one such term is the ‘Duty to render faithful service’.

This term essentially means that the employee is under an obligation not to act in a way that is contrary to the interests of the employer. An example of how this term can be used is found in the case of Sinclair v. Neighbour 1967 2 QB 279, where the Court of Appeal held that any misuse of an employer’s property by an employee in a position of trust will amount to a breach of this implied duty.

Even though in this case there was no dishonesty involved, because the employee had taken his employer's money for a purpose of which he knew the employer would disapprove, the conduct was sufficiently reprehensible to warrant summary dismissal.

An employee owes his or her employer a duty to act in such a way that the employer can have confidence in the employee.

Another term implied into the employment contract is a ‘Duty of fidelity on the part of the employee’.

This duty of good faith and loyalty continues for as long as the employment contract continues. Breach of this implied term of fidelity is likely to entitle the employer to dismiss the employee for gross misconduct.

This duty is generally clarified and restricted further by the written employment contract which will make any disciplinary procedure easier to follow. This term requires your employee not to compete with you, in the main, during working hours.

If there is not an express written term preventing working/competing outside of ‘working hours’ then dismissing an employee on this ‘implied term’ could prove problematic.

Another important implied term in the contract of employment is the term of ‘mutual trust and confidence’.

The relationship of employer and employee is regarded as one based on mutual trust and confidence between the parties. This term can be relied upon by both the employee and employer, although generally it is employees who attempt to rely upon this term because the employer can usually rely upon an express term within the employment contract.

However if the actions of your employee are such that you believe that you can no longer trust the employee then potentially you may be able to dismiss the employee, provided of course you can substantiate this belief.

To fairly dismiss an employee you must be able to demonstrate that you had a potentially fair reason to dismiss and also that you have followed a fair procedure.

Prior to taking any decision to dismiss you should investigate the circumstances to establish exactly what is being alleged.

Once you have a clear understanding of the allegations against your employee, invite the employee to a disciplinary hearing ensuring you follow your disciplinary procedure. If you have any documents or witness statements that you intend to rely upon then your employee should receive copies of this information with the letter inviting him to the disciplinary hearing, including any CCTV footage etc.

Hold the hearing and allow your employee the reasonable opportunity to respond to the allegations.

After the hearing you must decide what action to take, don’t fail to make a decision especially if you believe it is serious.

Also remember that your employee may allege that you have dismissed him/her unfairly so try and think objectively. If you are a member of the RML legal Helpline contact an advisor to discuss this situation prior to making a decision.

Discussing the matter with a 3rd party can help to clarify the matter and remove some of the emotion.

Once you have made a decision you should set out your decision and the reason for it in writing, RML will assist members with the creation of this letter.

You should review your disciplinary procedure and determine whether any formal action is going to be taken, if so what level of warning can be given or ultimately whether you need to dismiss.

If you are considering dismissing the employee I suggest that you review this decision carefully and that you are confident as to your legal position otherwise your decision may be reviewed in an Employment Tribunal and if it is not deemed to be fair your employee may receive compensation.

RML members are advised to always contact RML prior to dismissing an employee.