Having to dismiss an employee isn't fun — but sometimes it's the only option.
Following the right process can ease the stress of the situation, and help to ensure that you don't end up with a personal grievance case.
Use the following task lists and checklist to help you avoid common pitfalls. These will also provide a record of what's happened.
There are many reasons you may need to dismiss an employee. Whatever the reason, make sure you follow a proper, fair process.
Misconduct can include things like:
If you've followed the right process for managing misconduct, and given your employee a fair opportunity to improve their behavior, ongoing misconduct can lead to dismissal. You’ll need to give them the amount of notice stated in the dismissal clause in their employment agreement.
Some misconduct is so serious that it may warrant immediate dismissal. This could include:
Whatever the behaviour, you need to follow a full, investigative process before you dismiss someone. If your investigation finds that your employee’s actions amount to serious misconduct — that you no longer have the trust or confidence that they can do the job — you can terminate their employment agreement without notice.
Generally, you can’t suspend an employee unless there’s a suspension clause in the employment agreement. In very serious cases, you may be able to suspend someone while you investigate the misconduct, e.g. to protect your accounts from possible interference after an alleged theft, or to protect the victim in the case of an alleged sexual assault.
Before suspending them, you must discuss the proposed suspension, and the reasons for it, with the employee and consider their comments with an open mind.
Misconduct and serious misconduct (external link) — Ministry for Business, Innovation and Employment (MBIE)
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When you're considering dismissing someone, you need to be sure it's the only acceptable option. When you're making your decision, consider things like:
If you’re at all unsure on how to act, consider whether another reasonable employer would consider dismissal as an option due to the seriousness of the misconduct.
You can only consider dismissal if:
If an employee has engaged in serious misconduct, you may need to investigate and gather witness statements regarding what has occurred. You should get written statements from witnesses, with details like:
Tell the witnesses that you'll be disclosing their allegation to the employee you're investigating. If you witnessed it yourself, document your own statement of the event, and get statements from other witnesses if possible.
If the employee has engaged in previous misconduct, or has been through a performance management plan, gather the previous warnings on their file. Refer to these warnings in Step 3.
Check relevant company policies and your employee's employment agreement for clauses outlining what is considered to be serious misconduct, so that if the allegations are proved, you can confirm, that they breached your rules.
Set out the details in a letter. The letter should include:
Meet with your employee on the date stated in your letter. You can both have a support person or representative there, if you want to.
Give your employee the chance to tell their side of the story. At the end of the meeting, let them know how long you'll take to consider the situation (normally a day or two), and when you'll inform them of the outcome.
Consider all the evidence and decide what the outcome will be. You may decide:
When deciding how to deal with the behaviour, consider what an objective, reasonable employer would do in your situation. If you decide dismissal is appropriate, it’s good practice to give the employee another chance to respond in person to your decision.
Detail your findings in a letter to your employee, stating:
For cases of serious misconduct where you have lost the trust and confidence in them to do their job, you may be able to dismiss them without allowing them to work out the notice period — this is called summary dismissal.
Complete the employee exit checklist to make sure you’ve done everything you need to do.
To reduce the risk of a personal grievance, don’t fall into these common traps: