Resources: Blogs

Toolbox essentials


Employee dismissed for theft of tools unfairly dismissed

The Fair Work Commission has reminded employers about the duty to afford procedural fairness to employees prior to dismissal.

The Fair Work Commission (FWC) has reminded employers about the duty to afford procedural fairness to employees prior to dismissal.

In Armour v Mader Contracting Pty Ltd [2023] FWC 1034, the employee was employed as a heavy diesel mechanic for the labour hire employer and had been hired by a client to work at its mine in the Northern Territory.

On his return home, airport x-ray screening uncovered two shifter tools in the employee’s backpack after having checked them out from the client’s warehouse two days earlier. The client conducted an investigation and banned the employee from working at the mine.

The employer subsequently summarily dismissed the employee for engaging in theft. 

The employee lodged an unfair dismissal application with the FWC alleging that there was not a valid reason for his dismissal and that he was not provided with procedural fairness.    

The employee claimed that there was no valid reason for dismissal as the employer had assumed, based on the client’s incident report that he had intended to steal the tools but that this assumption could not be proved. Rather, the employee’s evidence was that he had forgotten to return the tools to the warehouse before leaving the mining site and that there was no reason for him to risk his employment by attempting to take the tools as they were common, cost less than $100 and he already owned a set.

As to the denial of procedural fairness, the employee submitted that he did not know that his employment was at risk and did not know the reason for his dismissal until after the employer advised him of the termination of his employment.

The employee contended that the employer had simply followed the client’s direction that it no longer wanted him on site and did not put him on notice that his employment was at risk. The employee claimed that he was not asked to provide responses as to why his employment should not be terminated.

The employer submitted that the employee engaged in serious misconduct and that the logical conclusion given the events that occurred was that the employee engaged in theft. In particular, the employer argued that the employee had opportunity to return the tools to the warehouse before he left the site, given he had checked them out three days earlier and claimed that they were the wrong size for the job.  

As to procedural fairness, the employer submitted that the employee had the opportunity to respond in phone calls to managers after the incident, but he was not honest or forthcoming until after he was advised that the incident was being treated as theft. The employer also submitted that the employee was aware before his dismissal of the investigation and that his employment was at risk.

The FWC found that there was no evidence that could support a finding that the employee had intentionally stolen the tools and as such did not engage in serious misconduct. However, the FWC was satisfied that there was a valid reason for the employee’s dismissal arising from the conduct as he was in breach of the client’s policy which required tools to be returned to the warehouse.

Notwithstanding that there was a valid reason for dismissal, the FWC found that the employer had not complied with its obligations to provide the employee with procedural fairness prior to dismissing him. In particular, the FWC found that:

  • The employer did not notify the employee that it was considering terminating his employment and only informed him that the client had banned him from their site;
  • The employer only notified the employee of the reason for dismissal at the time of the dismissal;
  • The employer’s correspondence with the employee concerned obtaining information about the incident and could not be considered an opportunity to respond to the reason for dismissal;
  • The employer did not provide the employee with the opportunity to explain why his employment with their business should not be terminated.
  • The employer relied upon the employee’s explanation to the client and relied on this as the basis to terminate his employment.
  • The employer did not conduct its own investigation and relied on the client’s investigation into the incident.

Accordingly, the FWC was satisfied that the employee was unfairly dismissed.

Lessons for employers

In this matter, the FWC noted that the employer had a responsibility to provide the employee with a procedurally fair process prior to terminating his employment. Procedural fairness requires employers to:

  1. put the employee on notice that their employment is at risk and the reason prior to the dismissal; and
  2. provide the employee with the opportunity to respond to the reason.

For labour hire employers, this decision reiterated that employers conduct their own disciplinary process relating to employee incidents at client sites.


Information provided in this blog is not legal advice and should not be relied upon as such. Workplace Law does not accept liability for any loss or damage arising from reliance on the content of this blog, or from links on this website to any external website. Where applicable, liability is limited by a scheme approved under Professional Standards Legislation.

Similar articles

Failure to warn employee renders dismissal unfair

Template lesson

Many businesses, and in particular small businesses employers subscribe to human resources information systems which offer access to template letters and policies to provide a ready-made solution or to manage human resources administration.


Employer’s withdrawal of role constituted dismissal from employment

Late withdrawal

For most employers, casual employment is favoured because of the flexibility it provides – employees are employed as required and have no guarantee of ongoing employment. This flexibility however does not mean that casual employees are not protected from adverse action.


Employee unfairly dismissed for requesting family and domestic violence leave

Boiling point

All employees (including part-time and casual employees) will soon have the entitlement to 10 days of paid family and domestic violence leave per year under the National Employment Standards, replacing the existing entitlement to five days of unpaid family and domestic violence leave.


Commission finds employee’s flexible working request to work entirely from home was not reasonable

The worst has now passed

One of the many changes to the Fair Work Act 2009 (Cth) introduced this year include the Fair Work Commission’s new powers to deal with disputes relating to requests for flexible working arrangements.


Remote work environment risks and considerations

Barking up a broad tree

Work from home arrangements have become the “new normal” across many workplaces since the COVID-19 pandemic.


Superannuation obligations for independent contractors


A recent decision of the Federal Court of Australia – Full Court has provided some clarity to employers in relation to when the obligation to pay superannuation will or will not arise.


Let's talk

please contact our directors to discuss how ouR expertise can help your business.

We're here to help

Contact Us
Let Workplace Law become your partner in Workplace Relations.

Sign up to receive the latest industry updates with commentary from the Workplace Law team direct to your inbox.