Don’t Dismiss an Employee for Misconduct Without Conducting a Due Inquiry

Gerome Goh

If an employee has misconducted himself at work, employers are often driven to dismiss that employee in a fit of anger. Under section 14(1) of the Employment Act however, employers are required to conduct a “due inquiry” before dismissing employees covered under the Employment Act without notice for misconduct. Alternatively,…

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If an employee has misconducted himself at work, employers are often driven to dismiss that employee in a fit of anger. Under section 14(1) of the Employment Act however, employers are required to conduct a “due inquiry” before dismissing employees covered under the Employment Act without notice for misconduct.

Alternatively, an employer may have voluntarily undertaken to conduct a “due inquiry” before dismissing an employee without notice for misconduct in the employee’s employment contract.

However, what does a “due inquiry” entail?

What Will Constitute a Due Inquiry?

A due inquiry will normally be some sort of process where the employee is informed of the allegations and evidence against him so that he has a chance to explain his version of events.

While the law does not prescribe any formal due inquiry procedure, the Ministry of Manpower recommends that:

  • The employee be informed of his misconduct
  • The person hearing the inquiry should not be in a position which could suggest bias
  • The employee be given the opportunity to present his case

That said, the High Court has held that there may still be due inquiry even if the employee is not given the opportunity to present his case. This is provided that the employee is clearly aware of the allegations against him, full investigations are undertaken and there is sufficient material from such investigations for the decision-makers to decide whether to dismiss the employee without notice.

Also, the more informal the process of inquiry is, the more likely that the court will decide that “due inquiry” had not been undertaken. It may therefore be prudent for employers to keep contemporaneous written records of the investigation, and ensure that the letter of termination clearly states all the reasons for dismissal and also the fact that due inquiry had been undertaken.

Said lawyer Lyn Boxall:

“It’s easy to react with anger and frustration when employees do the wrong thing, so employers should plan ahead by putting internal rules in place on the steps to be taken and records to be kept if and when an employee might be dismissed.”

What if an Employer Fails to Conduct a Due Inquiry?

Should an employer be legally obligated to conduct a due inquiry before dismissing an employee but fail to do so, the employee is generally entitled to the payment of his salary for the length of time the employer would have taken to conduct the due inquiry.

If it is established that there is no misconduct on the employee’s part, then the employer is likely to be entitled to adopt the method most advantageous to it to terminate the employment.

For instance, the employer may simply need to pay the employee the contractually-required amount of salary in lieu of notice of termination, and any severance package.

Case Study: Long Kim Wing v LTX Credence Singapore

In the High Court case of Long Kim Wing v LTX Credence Singapore, the employer terminated an employee’s employment following the employee’s misconduct relating to the use of forgery, deceit and failure to seek approval before making unauthorised advanced payments to another employee.

The employer was legally obligated to conduct a “due inquiry” before dismissing the employee. However, the employee claimed that “due inquiry” had not been conducted, and claimed for damages.

The court eventually held that the inquiries and investigations that the employer had undertaken was insufficient to amount to a “due inquiry”. This was because:

  • The employer had not shown the employee all the evidence of misconduct
  • No formal process of “due inquiry” had been undertaken
  • One of the decision-makers had apparently not considered what would constitute “due inquiry” when inquiring into the employee’s misconduct

Hence, the employee was awarded damages for 7 days’ salary – 7 days being the court’s estimate on the length of time which the employer would have taken to conduct the due inquiry.

In order to avoid the contest of whether “due inquiry” has been conducted, employers should first check whether they are legally obligated to conduct a due inquiry before dismissing an employee without notice for misconduct.

This could be where the employee is covered under the Employment Act, or if the employer had voluntarily undertaken to do so in the employee’s employment contract.

If the employer is legally obligated to conduct a due inquiry before dismissing the employee for misconduct, the employer would then be wise to execute a formal due inquiry process to allow the employee an opportunity to present his version of the story, and to also accord due consideration to it.

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