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HR Update: How to deal with an incident of gross misconduct

When responding to an incident of gross misconduct, do not make these mistakes!

Bhayani Law is responsible for the BII HR and Employment Law Helpline and receive many calls daily asking for advice on safely (and fairly) dismissing an employee.

A lot of these calls are related to dismissals for gross misconduct, often when the employer has already made a poor decision in the heat of the moment.

These are the most common mistakes that we see when employers are responding to an act of gross misconduct:

  1. The employee is sacked ‘on the spot’ with no payment for their notice period.
  2. The employee is not paid remaining holiday entitlement as the employer does not think that they deserve it.
  3. The employee is told that they have committed gross misconduct and ‘will probably be sacked’ before any investigation or disciplinary has taken place.
  4. The employee has money deducted from their final wages to pay for the damage/theft.
  5. The employer does not give the employee a fair opportunity to prepare a defense in the disciplinary process.


Here’s what should happen:

1. Suspension on full pay

If you see or hear of somebody committing an act of gross misconduct, whether that be a physical altercation, theft or verbally abusing another member of staff, you are never entitled to sack them without notice or holiday pay ‘on the spot’.

If you need to remove them from the business, suspend them on full-pay and send a letter or email the same day, containing the terms of their suspension and explaining what has happened. Terms of suspension may include things like requesting that they do not contact any customers or staff.




2. Investigation

You need to conduct an investigation, even when you SAW them commit an act that constitutes gross misconduct! The investigation may be as simple as conducting investigation interviews with people who witnessed the incident, or an investigation meeting with the person asking them if they did what you thought you saw and why. Make sure you take notes of any meetings that happen and ask your interviewee to sign the notes to say that they agree that what has been written is a true record.

You need prepare a bundle of evidence that is coherent and shows careful consideration.

There is no set length of time that an investigation should take, it may take a few hours, or it may take weeks.


3. Disciplinary hearing

When you have all your evidence together, you need to invite them to a disciplinary hearing. You need to send all the evidence you are relying on along with the invite letter, such as a copy of CCTV and any witness statements.

Your invite letter is very important. In the invite letter:

  • Inform them of their right to be accompanied and make sure you give them 48 hours notice of the hearing.
  • Make sure you clearly state what the allegations are and why. For example ‘the allegation against you is gross misconduct in that £450 cash was stolen from the till on 12/03/2019 at 13:00.’ You need to give them a fair chance of putting together their defence and you can only do this if they fully understand the allegation and how it was formed.
  • Let them know the potential sanction that may be imposed (remember, no decision is pre-determined before the hearing). For example ‘the potential sanction that we will impose if we believe that you are guilty of theft is summary dismissal.’

Do not tell the employee the outcome at the end of the disciplinary hearing. Go away and think about it. Tell the employee you will be in touch ASAP.

Make sure you have a note taker at the hearing. Send the employee the notes after.




4. Disciplinary outcome which dismisses them summarily 

Following your hearing, you can either inform them of the decision in person or by letter. Preferably both.

If you terminate their employment, you need to pay all their accrued holiday up until the termination date, they continue to accrue holiday even when they are on suspension. Tell them what they are due to be paid and when they will receive this.

Explain your decision in the letter and how you arrived at it, you need to summarise the evidence and show how you formed a reasonable belief that they committed the act(s).

This letter is your opportunity to let them know when to return to the workplace to collect any belongings or return any company property.


You cannot deduct money to compensate losses from their final payment without a contractual clause that enables you to do this. Even if you have a clause in the contract, the loss you deduct for needs to be tangible, cannot put them at a financial hardship or below the National Minimum Wage.



(Employees with less than two years service)

In certain circumstances, it may be possible to dismiss an employee without due process (with payment in lieu of their notice period) if they have less than two years’ service as they will not be able to make a claim for unfair dismissal. There are lots of other risks attached to this kind of dismissal so we would urge you to seek advice before doing this.  


5. Follow the ACAS Code of Practice

When conducting an investigation or disciplinary, always follow the Acas code of practice, if you face an employment tribunal you will be measured against the standard set out in the Code no matter the size of your business.

You can find it here 


For help with any HR or employment law matter call the free BII Helpline and quote your membership number.

0330 058 3878