Can you be sacked for what you do after hours?

The starting point: your private life is your own

An unfair dismissal claim under the Fair Work Act 2009 (Cth) asks whether a dismissal was harsh, unjust or unreasonable. The first matter the Fair Work Commission looks at is whether there was a valid reason for the dismissal related to the worker's capacity or conduct (s 387(a)).

Conduct outside working hours raises a particular question: is it the employer's business at all? The test most often applied comes from Rose v Telstra Corporation Ltd [1998] AIRC 1592. Out-of-hours conduct can be a valid reason only where, viewed objectively, it is likely to cause serious damage to the relationship between employer and employee, it damages the employer's interests, or it is incompatible with the employee's duty as an employee. Otherwise, Vice President Ross said, an employer has no right to control or regulate what an employee does in their own time.

Two 2015 decisions applied that test and reached opposite results.

A night in employer-paid accommodation: dismissal upheld

In Applicant v Employer [2015] FWC 506, decided in Perth by Commissioner Cloghan on 16 February 2015, the parties are not named because of a non-publication order. In February 2014 the worker was staying at a hotel his employer regularly used. That day he had done paid training there, he was due to start a roster change the next morning, and the employer was paying his wages, meals and accommodation.

That evening, while drinking with colleagues, he touched a hotel waitress on the bottom without her consent. He said it was a tap on the hip to get her attention. The Commission preferred the evidence of the waitress and a bartender who saw it, and found the touching happened as the employer alleged.

He argued the incident was outside work hours. The Commissioner disagreed. The only reason he was at the hotel was his employment: the employer had a long-standing arrangement with the hotel and booked at least 40 rooms there every five weeks, and accommodation for roster changes was a condition of his enterprise agreement. That distinguished Rose v Telstra, where the worker had been given an allowance and chose his own accommodation. The conduct also put the employer's relationship with the hotel and its reputation at risk, and a year earlier he had been warned that further misconduct would almost certainly lead to dismissal.

The Commission found a valid reason, a fair process and nothing harsh, and dismissed the application.

Drinks after the Christmas party: dismissal unfair

Keenan v Leighton Boral Amey NSW Pty Ltd [2015] FWC 3156, decided by Vice President Hatcher on 26 June 2015, went the other way. Mr Keenan, a team leader, became intoxicated at the employer's Christmas function, where free alcohol was served without real limit. He was dismissed for what the dismissal letter called repeated unwanted "romantic and sexual propositions" to one colleague at the function and, after it ended and some staff moved on to a bar upstairs, kissing another colleague without invitation.

The Vice President found the kiss met the legal definition of sexual harassment, but held that what happened at the upstairs bar was not connected closely enough with the employment to be a valid reason. The employer had not organised that gathering, it was a public place, and nothing in the employer's policies said they applied to it. His approaches at the function, though unwelcome and upsetting, were found not to be sexual in nature and not serious enough to justify dismissal.

Conduct at the function itself was the employer's business, and aggressive, intimidating remarks Mr Keenan made there to a younger colleague were a valid reason. But the employer had left that incident out of the dismissal letter and never put it to him, he had more than seven years' good service, the conduct was out of character, the employer had done little to control the alcohol, and a supervisor who made a crude remark at work had only been counselled. The dismissal was harsh and unjust. Whether he would be reinstated was left for a further hearing; no later published decision on remedy has been found.

What has changed since 2015

The Rose v Telstra test is still applied, but the law on sexual harassment has moved. Since 6 March 2023, s 527D of the Fair Work Act prohibits sexually harassing a worker "in connection with" their being a worker, which covers contractors, volunteers and others as well as employees. Since December 2022, employers have also had a positive duty under s 47C of the Sex Discrimination Act 1984 (Cth) to take reasonable and proportionate measures to eliminate sexual harassment as far as possible. Sexual harassment in the course of employment was already, and remains, an example of serious misconduct under the Fair Work Regulations (reg 1.07).

Whether conduct like the upstairs-bar incident in Keenan is connected with work is still decided on the facts of each case, but the positive duty puts more onus on employers to plan work functions with that risk in mind.

What this means for you

If you are accused of something that happened after hours, the questions are how close the link to work was, whether the allegation was put to you, and whether dismissal was proportionate. Employers should make clear which events their policies cover, manage alcohol at functions they host, and put every allegation they rely on to the worker before deciding.

Anyone dismissed in the national system has 21 days from the dismissal to lodge an unfair dismissal application with the Fair Work Commission, so it is worth getting advice early.