Shrinkage due to theft by employees, particularly within the retail industry, remains a persistent and prevalent problem. It can, if not dealt with in an appropriate manner, be the death knell of a business. Consequently, dismissal for theft, unauthorized consumption and or unauthorized removal or possession of property remains one of the major reasons for dismissal within South Africa.
In this post, I will look at a number of principles or factors that should be considered by employers when deciding whether or not to dismiss an employee for petty theft and in the event that they do, what evidence they should produce, should the employee challenge their dismissal.
In understanding what petty theft is, I include theft, unauthorized possession and or removal of property belonging to the employer, which is of minimal or negligible value.
Assuming that you can prove that the employee is guilty, the following factors need to be considered.
1. It seems that our law draws no meaningful distinction between acts of theft and cases of unauthorized possession or unauthorized removal of property for the purposes of evaluating the fairness of the sanction of dismissal. Theft is a very specific offense and you are required to prove the intent to permanently deprive the owner of ownership of the item in question. It is not always easy to prove such intent. That is why I recommend that the employer implement very specific rules relating to the possession and or removal of company property. If an employee breaches such a rule, it is not necessary to prove that he or she had the intent to steal. All you need prove is that the employee is in possession of the property or has consumed the property in circumstances when he or she should not have been in possession or consumed the property. The reason why little, if any, distinction is drawn between theft and unauthorized possession or removal is that rules relating to the latter are implemented to prevent the former and, therefore, breaches of these types of rules are seen in a serious light. It should be noted, however, that these rules and or procedures should be clear, they should be designed to prevent theft, they should be clearly communicated to employees and employees should be warned that they may be dismissed if they breach these rules.
2. Employers must be aware that in assessing whether or not to dismiss an employee for petty theft, they may not merely rely on the fact that an employee has or has attempted to remove company property. It has become increasingly clear that all relevant circumstances must be taken into account when assessing what a fair sanction is in the circumstances. What is relevant and in what way it is relevant will be discussed below.
3. The first factor that may play a part is the value of the item. There are conflicting decisions as to whether the value of the item in question is a factor to be considered in evaluating the fairness of a disciplinary sanction. It seems that the position is that the value of the item in question carries little or no weight in the assessment process (see De Beers Consolidated Mines Ltd v CCMA & Others for example). However, the reality is that many arbitrators as well as some judges do consider the value of the item as being significant.
4. There is also the question of the employees’ length of service and disciplinary record. It stands to reason that a person’s disciplinary record is always relevant in determining the issue of sanction. However what if the employee is, for example, caught eating a pie and she has a clean disciplinary record. Does this mean that you should not dismiss? No. The vast majority of decided cases have held that you can dismiss for petty theft even if this is the employee’s first offence. However, I would suggest that at least one of two factors have to be present where there is a clean service record. If either the trust relationship has been irreparably broken or the circumstances sustain the contention that the employee is unlikely to reform to his or her conduct in the future there is due motive for a dismissal despite a clean service record.
What about length of service? Although many consider length of service to constitute a mitigating factor in and of itself, I believe that this is incorrect. In De Beers Consolidated Mines Ltd v CCMA & Others the LAC said that length of service is only material, which can support the contention that the employee’s actions were anomalous and it is unlikely to be repeated. Thus where an employee has a significant period of service and a clean disciplinary record, an inference may be drawn that the incident was a ‘once off’ and is unlikely to be repeated. However, there may be other factors present that may negate or prevent such an inference from being drawn. One of these factors is discussed below. Another factor may be that the nature of the business and or of the employee’s position may be such that you cannot take a risk that the offence may be repeated. For example, where the employee is a security guard or is the financial director.
5. Whether the employee acknowledges his or her wrongdoing or denies that he or she is guilty is an important factor to consider. In a number of cases it has been held that the fact that an employee has created a mendacious account of what occurred and or where he or she denies that he or she is guilty, the presence of such factors strongly supports the contention that dismissal is appropriate (see Miyambo v CCMA & Others and Shoprite Checkers (Pty) Ltd v CCMA & others for example). This is so because firstly a person who refuses to acknowledge their wrongdoing is unlikely to reform their conduct and secondly by denying their wrongdoing, they compound their initial dishonesty and demonstrate a dishonest disposition.
6. I also suggest that the nature of the employee’s job and their duties and responsibilities also are important factors. If the employee were in a position where trust is particularly important, this would support the contention that dismissal is appropriate. However, this does not mean that if an employee is not in a position where trust is of particular importance, that dismissal would not be appropriate.
7. The circumstances in which the petty theft occurred may also be of importance. If, for example, an employer has been suffering shrinkage or has a shrinkage problem at the time of the offence or indeed prior to the offence, this would serve to justify taking strict action against employees who engage in petty theft. If an employer has a ‘zero tolerance’ policy, it is advisable to provide reasons at arbitration as to why such a policy is necessary. Prevention of shrinkage is such a reason and this reason would have even more resonance if the employer has or is suffering shrinkage.
8. Lastly I would say that the impact of the misconduct on the trust relationship is the most important factor. It is true that by the very nature of dishonesty, when an employee steals or attempts to steal, there is a significant impact on the trust relationship. However, it is not sufficient merely to boldly allege that the trust relationship has broken down. I would suggest that, if you are seeking to justify a dismissal for theft at arbitration, you explain why the trust relationship has broken down. It is particularly important that you call the employee’s immediate superior to come and give evidence that he or she no longer trusts the employee to carry out their duties.
This post is for informational purposes only and is not intended to substitute for legal advice. It is strongly recommended that you seek advice before instituting disciplinary action against an employee for petty theft and or presenting a case before the relevant tribunal. The writer of this post does not accept any responsibility of whatsoever nature for any consequences that may follow from relying on the contents of this post.
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