We have an employee who has long service that has just been sentenced to two months in prison for non payment of some bills. Presumably it is a straight forward dismissal because he is in prison or maybe he has dismissed himself so we need to do nothing?
Peter replies:
It is not that straightforward. There is no such thing as self dismissal and he has not resigned.
Case law has established a number of factors for the employer to consider in these circumstances.
- The nature of the offence.
- The length of the sentence.
- The nature of the employee’s job.
- The effect of the employee’s absence on the business.
- The damage (if any) to the employer’s reputation.
- The employee’s previous track record, length of service and disciplinary record.
- Whether in all the circumstances a reasonable employer could have been expected to wait.
You should carry out an investigation and conduct a fair disciplinary procedure, as far as possible in the employee’s absence, before deciding whether or not it would be reasonable to dismiss him.
If the employee is likely to be in prison for a long time, it may be fair for the employer to dismiss him on the grounds that he will be unable to perform the contract of employment — known as frustration of contract. Frustration is a difficult legal concept in employment law terms, as tribunals are usually reluctant to accept it as a reason, because it deprives the ex employee of any legal redress.
Frustration of contract is unlikely to apply for a relatively short prison sentence. There is a huge difference between ten years for a violent crime and three weeks for non-payment of maintenance. If the employee is imprisoned for a short time, for an offence that is unrelated to his or her work, it may be reasonable for the employer to hold the employee’s job open until he or she returns. You must still act reasonably in concluding that the employment is ended for that reason. The doctrine of frustration is normally accepted by the courts only where the frustrating event renders all performance of the employment contract clearly impossible. Our advice would be that it should only be actively considered for longer periods of imprisonment.
ACAS recommend taking disciplinary action if you want to terminate employment.
If an employee is sentenced to prison for a short period, (which 2 months is) the best thing to do is treat it as an absence issue and deal with as well as you can with someone with limited ability to communicate. Investigate the circumstances before making a decision and try to give some opportunity for them to have their say even if it is through an exchange of letters.
Alternatively, if the offence relates to your business or the employee’s actions have adversely affected the reputation of the business you may be able to dismiss him for some other substantial reason (SOSR) but this would still require following a proper procedure and applying sound judgment.
Doing nothing is not an option in practical terms, if you do not want him back. It may well be wiser and safer to do nothing other than to keep in contact and welcome him back to work after his sentence. Finally you do not have to continue to pay him whilst you are sorting out the situation, as for the moment he is currently not able to fulfil his work duties.
The guidance provided in this article is just that – guidance. Before taking any action make sure that you know what you are doing, or call us for specific advice.
