National retail chain Aldi Foods had grounds to terminate the employment of a store manager with notice after he took goods home without paying for them, but its failure to act immediately or to conduct a proper investigation meant there was no basis for summarily dismissing him, FWA has found.

Commissioner Ian Cambridge said that while employers are not required to meet the criminal standard of proof in establishing misconduct as a basis for dismissal, Aldi management "failed to satisfy even a basic level of proof upon which to find that the [store manager] acted dishonestly or committed theft".

He said that the store manager had committed serious misconduct in taking the goods without payment and, as a retail industry manager, this misconduct "represents a fundamental transgression of the reasonable expectations of any employer in this industry".

He said that such misconduct would normally have provided a valid and justifiable basis for dismissal with notice.

However, Aldi's decision to wait to see if the employee paid for the goods introduced an element of employer condonation which then meant the initial action could not be relied upon as a valid reason for summary dismissal.

Commissioner Cambridge cautioned against summary dismissal for reasons of dishonesty because of the potential harm "if unsound and erroneous findings are made".

"In this case [the store manager] did not act dishonestly nor did he steal from the employer. However he has suffered from the odium associated with the employer's erroneous findings".

Store manager's reminder strategy derailed

The store manager, who had four years service, decided to purchase some groceries immediately before finishing work in October 2011.

Realising he did not have his wallet, he asked the cashier to suspend the sale and print out the sales docket.

He then signed the docket and asked the cashier to secure the docket to his computer so it would remind him when he returned to work the following week to pay for the groceries.

On the weekend, other Aldi managers became aware of the suspension of the sale and, at some point, the signed docket went missing.

None of the other managers, including the area manager and store operations director, contacted the store manager to discuss their concerns, but decided to instead allow him to return to work to see whether he paid for the goods.

The store manager did not pay for the goods "presumably because the docket that had been attached to his computer screen in order to remind him had mysteriously disappeared", but immediately did so when alerted to the company's concerns two days later.

After a meeting between the store manager and the area manager and store operations director, the area manager decided to summarily dismiss him and completed an Employment Separation Certificate which gave the reason for dismissal as misconduct involving "dishonesty/theft".

Commissioner Cambridge said the area manager "appeared to have been so overly focused" upon the taking of the goods and whether any subsequent payment would occur, that he "completed failed to properly investigate and consider the important implications of the suspended sales docket and its mysterious disappearance".

He said a "proper, comprehensive and balanced consideration" should have left Aldi management with "serious concern about the ethical and moral standards" of the managerial staff member who arranged the disappearance of the suspended docket.

"That person will no doubt read this Decision, and if he or she has any conscience, they should be seriously troubled by prolonged guilt".

Manager's misconduct rules out reinstatement

The former store manager, who has been unable to obtain employment in the period since his dismissal, applied for reinstatement if his application succeeded.

However, Commissioner Cambridge said his misconduct had created concern "in the mind of the employer regarding his suitability as a manager. This concern has created impediment to the reestablishment of any employment relationship".

In decided to award compensation, Commissioner Cambridge reduced the amount to be paid because the employee's misconduct had contributed to his termination.

He ordered a compensation payment of $15,672, which amounted to 12 weeks pay.

Somveer Narwal v Aldi Foods Pty Ltd [2012] FWA 2056 (14 March 2012)