News Article

latest news in employment law

Contributory Fault

Published 16 Jan 2017

The Employment Court has recently reviewed the level of deduction that can be made to an award of penalties because of the contributory fault of the dismissed employee.

Employers may remember in our August newsletter we discussed a case in which a 100% deduction was made after an employee had been drinking alcohol on site and offering it to others.  The Authority found there had been failings in Hydrovac’s disciplinary process but decided the Employee’s behaviour was causative and blameworthy to the extent that 100% reduction in remedies was appropriate and declined to award Mr. Lenaghan any compensation.

In this recent case the Authority had originally determined that the employee was unjustifiably dismissed and awarded lost wages and $12,000 in compensation. The Authority then had regard to the Employees’ actions and the award was reduced to $10,000.

The Employer appealed the decision claiming the Employee’s contribution should have resulted in a deduction so great that no award of remedies was made. The Court considered the ability of the Authority to apply a 100% reduction in penalties awarded due to contributory fault.

Following a detailed consideration of case law and the evolution of s124 of the current Act (the part allowing the reduction in award) from its predecessors, the Court concluded that a reduction of 100% to awards made was not possible and upheld the Authority’s original decision.

The Court further said that it would only be in extreme cases where a deduction approaching 50% would be considered.

This decision suggests that in future cases, any award of compensation will not be reduced to zero after taking into account how much the employee’s actions contributed to the dismissal.  Employers will instead need to argue that no compensation should be awarded in the first place.