A recent Fair Work Commission decision reinforces that employers must take care with their investigations of misconduct, and determine whether a work practice has been condoned by management before sacking staff. In this case, the Commission reinstated three employees who had been summarily dismissed due to a policy breach.

Key Takeaways

  • Consider whether an unwritten work practice or policy should be documented. Well drafted policies communicate company practice, procedure and expectations, are an inherent part of training; prevent misunderstandings and enhance compliance.
  • Where there is an alleged breach of an unwritten policy, employers need to dig deeper to determine whether the behaviour or work practice is widespread or condoned, or the unwritten policy inconsistently applied.
  • Make sure employees are adequately informed about the allegations against them.
  • Don’t ignore employee concerns about what is being investigated and how, especially where those concerns are about their health/welfare.
  • A company’s size and resources will influence the Commission’s decision about whether a dismissal is unfair.


The employer in this case provides residential and commercial pest control services. A dedicated sales division known as the Pest Commercial Sales Team (Sales Team) had access to a Commission Plan, which permitted members of the Sales Team to earn monthly commissions based on meeting sales targets.

In late February 2023, three employees in the Sales Team transferred sales credits under the Commission Plan to each other. One requested and received credits from another. Another transfer occurred between two other staff, one of whom was subsequently dismissed. The transfers were documented in the Master File, which stores financial data relating to the sales activity of the employer.

Three employees were ultimately summarily dismissed for sharing sales credits. The employer deemed this misconduct, a breach of company policy and a breach of the employee’s Code of Conduct. The employees did not know about a change in policy, asserting that credit sharing was a well-known and accepted practice.


The Commission concluded that the dismissal of the employees was harsh, unjust and unreasonable because:

  • There was no documented policy expressly prohibiting the transfer of sales credits without management approval. There was no evidence that such a policy had been communicated verbally either. Further, there was no established practice for manager approval.
  • Transferring sales credits had been a practice that took place with the awareness and approval of past managers.
  • The “show cause” process was “conducted with considerable haste”, (which was unreasonable in light of the potential ramifications for the employees) and- The employees weren’t informed that their initial meetings were about “potential disciplinary matters”.- The “follow-up meetings” were set for the next day, and one employee was given only 24 hours to respond to the allegations.

    – After the initial meetings, the employees requested some consideration regarding the timing of subsequent meetings scheduled due to health issues. One had high blood pressure. One requested sick leave but was nonetheless required to provide a response to the allegations. Another, dealing with a risky pregnancy, sent a written response backed by a medical certificate. However, the Respondent refused the requests for more time to formally respond.

  • The disciplinary outcome of summary dismissal was disproportionate, and at least one staff member who was implicated was not subjected to a disciplinary process.
  • Given the employer’s business size, it could conduct a comprehensive investigation and offer sufficient time for the employees to provide their response without causing excessive disruption to the business. The employer had the means to review its records to validate the employees’ claims about previous sales transfers. The Sales Manager who was investigating the alleged breaches admitted that he chose not to explore past practices, which was a notable shortcoming.

Mrs Mary Philippe, Mr Joel Lewin & Mr Benjamin Comer v Rentokil Initial Pty Ltd [2023] FWC 2032 (15 August 2023) 

Further assistance

If you need advice about whether your policies are fit for purpose or you require assistance with investigations, please contact info@justitia.com.au for further information.