More often than not, employers are faced with the dilemma of handling disciplinary cases that have a criminal element. Such cases include fraud, malicious damage to property and theft, among others, that may be committed by an employee at the work place.
When these occur, the relevant questions for consideration include:
- Can an employer proceed with disciplinary proceedings at the work place in parallel with police investigation or the prosecution of a criminal case in court?
- What is an employer required to do when an employee has committed misconduct of a criminal nature?
- What are the consequences of proceeding with a disciplinary hearing whilst a criminal case is still pending?
This employment briefing will address the issues above.
Can an employer proceed with disciplinary proceedings at the work place in parallel with the prosecution of a criminal case in court?
The Employment and Labour Relations Act, 2004 (the ELRA) states that:
No disciplinary action in form of penalty, termination or dismissal shall lie upon an employee who has been charged with a criminal offence which is substantially the same until final determination by the Court and any appeal thereto.
In simple terms, the ELRA prohibits an employer from taking any disciplinary action against an employee, who has committed misconduct of a criminal nature and whereby the employee is charged with and is being prosecuted in court.
Therefore, an employer will need to retain an employee who has committed misconduct of a criminal nature (e.g. theft, financial fraud) on the payroll until the final determination of the employee's case. A possible remedy for the employer under such circumstances is for the employer to suspend the employee on full pay. The Employment and Labour Relations (Code of Good Practice) Rules, 2007 (the Code) provides that:
Notwithstanding the provisions of the ELRA, an employee charged with a criminal offence may be suspended on full remuneration pending a final determination by a court and any appeal thereto, on that charge.
Further, the Guidelines for Disciplinary, Incapacity and Incompatibility Policy and Procedures set out in the Code (the Guidelines) state that:
It is recognised that an employee’s misconduct may in certain circumstances result in criminal proceedings being instituted against the employee (e.g. cases of theft or assault). A clear distinction should be made between criminal proceedings and internal disciplinary proceedings. Disciplinary action should be instituted and decided fairly irrespective of the process and outcome of any criminal proceedings.
Thus, despite of the criminal proceedings and outcome against an employee, there is an emphasis on the proper internal disciplinary action to be carried out in relation to an employee's misconduct.
The High Court of Tanzania (Labour Division) confirmed this position in the case of Stella Manyahi and Another v. Shirika la Posta Lab Div., DSM, Reference Case No. 2 of 2010 where the court held that:
“When an employee is accused of criminal offence which is also a breach of disciplinary code and the employer has taken the bold step of reporting the incident to the police and the police investigation is commenced, other disciplinary proceedings should not be mounted… No proceedings for imposition of a disciplinary penalty should be instituted pending the conclusion of the criminal proceedings and of any appeal therefrom.”
What is an employer required to do when an employee has committed misconduct of a criminal nature?
In order to avoid breaching the law, where an employee has committed misconduct of a criminal nature, an employer may consider taking disciplinary action against that employee prior to reporting the matter to the police. This will entail, giving a "show cause letter" to the employee, conducting a disciplinary hearing with the employee and finally, giving a termination letter to the employee in respect of their employment contract.
The employer may then report the employee's criminal misconduct to the police after giving the termination letter. The employer should always consider the weight of the criminal offence and the risk of the employee running away from the criminal justice. There may also be cases where there is an obligation on the employer to notify the police prior to taking any further steps.
What are the consequences of proceeding with a criminal case whilst a criminal case is still pending?
If an employee's employment contract is terminated on the ground of criminal misconduct, but the employee's case has not been finally determined in court, there is a risk that the Commission for Mediation and Arbitration (CMA) and any appellate court may regard this as unfair termination.
If the CMA and any appellate court find that the employee's termination has been unfair, the employer may be to:
(a) reinstate the employee from the date of termination without loss of remuneration;
(b) re-engage the employee on any terms that the CMA / appellate court decide; or
(c) pay compensation to the employee of not less than 12 months' remuneration.