A recent case Hallwright v Forsyth Barr Ltd has provided further insight into the court’s approach to misconduct occurring outside the workplace.

Misconduct outside the workplace may justify a dismissal. However, employers should take care to act reasonably in the circumstances and to follow a fair process. This may include delaying a decision on disciplining an employee pending the outcome of a criminal trial and sentencing.

The Court commented in Hallmark that different forms of out-of-hours conduct cannot automatically be excluded from the reach of an employment agreement.

In assessing whether conduct is linked to employment, the Court said that the test is not necessarily whether the conduct itself is directly linked, but whether it has the potential to impact negatively on employment. Judge Inglis explained; “that is why an employee can be held out for what might otherwise be regarded a private activity, carried out away from the workplace and with no ostensible connection to the employment or other employees.”

This case reiterated that the focus of the enquiry is on the impact of an employee’s conduct on the employer’s business. The nature of an employer’s business and the validity of its concerns about maintaining its reputation, both in the market place and within its client base, are taken into account in determining the required nexus between an employee’s conduct and their employment.

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