Settlement Agreements and Misconduct

Do you operate in a safety critical environment? Does your employer advocate and operate a zero tolerance policy to drugs?

An employee with 15 years’ of unblemished service was dismissed after testing positive for cannabis use. The employers asked her to submit to a drug test following an anonymous tip-off. The employee agreed to take the test, and signed a document confirming her awareness of the consequences if she tested positive for illegal substances.

The company had in place a substance abuse policy that expressly stated that a positive test for illegal substances would be classified as gross misconduct. The employee, having failed the drug test was invited to a disciplinary hearing and dismissed.

It had not been established that the employee had ever been under the influence at work nor did they consider offering her a settlement agreement.

Despite winning her employment tribunal claim of unfair dismissal, the company were successful in their appeal. Upholding the appeal, the Employment Appeal Tribunal (EAT) applied the established legal principles of a fair dismissal and held that the test of an employer’s reasonable belief does not require the belief to be reasonable – it only requires that the employer demonstrate that it had that the belief in mind when it made the decision to dismiss. The EAT also held that the test of fairness requires only that the employer demonstrate that it had reasonable grounds for that belief.

Although the decision might look harsh at first blush, employers have the freedom to establish their own culture and values. The employer company operated a zero-tolerance policy to drugs and operated in a safety-critical environment with heavy machinery. The company’s substance misuse policy was clear that a positive test could amount to gross misconduct. Employers operating in safety-critical environments are afforded considerable latitude in their implementation of policy.

The main lesson to be learned from this case for employees is the importance of clarity in understanding their employer’s substance misuse policies including specifying the basis of selection for testing (i.e. random or on reasonable suspicion) and transparency in the testing.

Settlement agreements are often offered in situations where there have been breaches of policies and cases such as this are a reminder that litigation is highly unpredictable.

If you are involved in any type of dispute or need confidential advice on a settlement agreement or any other legal matter then please book a free consultation to suit you now.

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