But what of reputational damage that follows on from the actions of an employee? How should employers react? On the one hand there’s the need to protect the firm, on the other, there’s a requirement to be fair when investigating.

Consider the case of an employee of a US-based direct mail company, Navistar Direct Marketing, based in Maryland, who was caught on camera rioting in the US Capitol in January. Wearing his company ID wasn’t the brightest thing to do; it led to his identification, the company fielding comments from the public, and his dismissal.

Context is everything

According to Tina Chander, partner and head of the employment law team at Wright Hassall, it’s important to recognise that every case of employee-related reputational damage is different and further, “context is everything when considering whether an employee has caused their employer reputational damage”.

She offers examples to make her point: “For anyone involved with children or vulnerable people, any misconduct of a sexual nature, even if enacted in private (and legally), that finds its way into the public domain, is likely to be reputationally damaging. Likewise, if an employee behaves inappropriately during working hours and is clearly identifiable as a company employee, their employer might justly accuse them of bringing the company into disrepute.”

This last example was demonstrated by a case in which an employee was dismissed following an allegation of bullying and harassment by a member of the public. His claim for unfair dismissal was dismissed as he was wearing the company’s branded uniform during the incident, so his actions directly impacted his employer’s reputation.

But for Amanda Trewhella, managing associate at Freeths, reputational damage caused by an employee to an organisation depends upon how well known the employee is, whether the public associate them with their employer, as well as the seriousness of their actions. She says “it is particularly likely that for those with a high profile in the public eye poor conduct could cause reputational damage to their employer”.

And she illustrates this with the example of Kay Burley, a Sky News presenter, who broke Covid rules during her 60th birthday party celebration. The matter was investigated by Sky and she was taken off air for six months. “Usually,” says Trewhella, “conduct like this is unlikely to warrant disciplinary action by an employer where it occurred outside of work, however as Burley is in the public eye representing Sky it was necessary for them to take action to protect their reputation.”

People in everyday roles can also find themselves in the spotlight. Delivery drivers are regularly ‘outed’ on social media if caught behaving inappropriately in a country that now bristles with domestic CCTV systems. And a road rage incident, for example, involving the driver of a company’s branded vehicle can quickly blow up on social media or end up splashed over a tabloid newspaper.

By the same token, Chander says that there must be proportionality – that employers don’t always win. As she highlights: “In one case that came before an Employment Tribunal, the claimant had been disciplined by his employer for telling a customer that service levels were being affected by lack of staff. His employer considered that his actions had brought the company into disrepute. The Tribunal disagreed on the basis that there was no evidence that the employee’s candour had damaged the customer relationship.”

And then there’s the risk that an employee can cause reputational damage, either inadvertently or deliberately, through social media. On this Chander tells how “there have been several high-profile cases of employees expressing views, or sharing the views of others, that are directly contradictory to the principles endorsed by their employer”. She cites the example of the dismissal of Danny Baker by the BBC after he tweeted a controversial picture after the birth of the Duke and Duchess of Sussex’s baby.

The BBC was caught up in another reputational issue after journalist Emily Maitlis shared her personal views on actions of Dominic Cummings in breaking lockdown rules. As Chander says, “many thought she broke the BBC’s impartiality guidelines and thus brought the Corporation’s reputation into disrepute. However, the BBC’s statement sought not to apportion blame but noted that she had ‘overstepped the line’”.

Clearly stung by these troubles the new director general, Tim Davie, made it clear last autumn (2020) that staff were not to express personal views that were likely to damage the BBC’s reputation for impartiality.

Inside or outside?

The fact that employees occasionally get into trouble is a given. But are the risks the same if the matter occurs inside or outside of the workspace or working hours?

For Trewhella, it is unlikely to matter if the conduct happened inside or outside of the workplace or working hours. She says that “the most relevant factors are likely to be the seriousness of the conduct, whether the conduct relates in some way to the employee’s role or the organisation more generally, and whether the employee is publicly linked to the organisation.”

A similar stance is taken by Chander who says each case has to be considered on its own merits. The problem, she says: “Is that the blurring of private and public life is becoming increasingly common as people share information via social media, assuming that they are doing so privately.” Incidents of private messages and images being leaked are many – some are just embarrassing whereas others do have capacity to cause real reputational harm.

Chander suggests that posting derogatory comments on social media about their employer could, in theory, lead to a charge of reputational damage if the company’s identity is obvious. “However,” she adds, “employers not only have to be very clear about why they consider the comments damaging, they must also check that their social media policy reflects the standard of online behaviour they expect of their employees.”

Policies protect

Whether it’s dealing with harassment, uniform, timekeeping or discipline, policies have an important role to play.

For Chander, “a well-drafted policy will set out what is, and isn’t acceptable; in other words, if boundaries are clearly laid out, no one will be able to say that they ‘didn’t know’ or ‘weren’t told’”. But of course, having a policy is one thing but it needs to be communicated else it’s not worth the paper it’s printed on.

A disciplinary and grievance policy should list examples of unacceptable conduct, including those that could bring the company into disrepute. It should also tie into a social media policy. “That way,” Chander says, “no employee could plead ignorance.”

Trewhella doesn’t disagree. She says that provided that policies are reasonable and have been communicated to employees, an employer will be able to discipline an employee who then breaches it. She adds: “It is particularly important to ensure that all policies are properly communicated to staff and if necessary and they are provided training on them – simply drafting a policy and placing it in a drawer will not assist if you later need to rely on that policy.”

As for a social media policy, she says that it should cover use of social media both in and outside the workplace. “It cannot be prescriptive about an employee’s private use, but it can set out the standards which employees are expected to follow; for instance, not sharing sensitive business information, not making defamatory statements or negative comments about the company or colleagues; or posting inappropriate images.”

Employment contracts should also include a clause that allows an employee to be dismissed if they breach the code of conduct laid out in the social media policy.

Investigating an allegation

Once an allegation has been made, an investigation is the starting point for any disciplinary hearing. But for a dismissal to be fair, the investigation must be thorough and carried out following the proper procedures otherwise the employer risks falling foul of the ACAS Code. As Chander warns, this “applies even if the employee’s misconduct appears to be an open and shut case and the employee has admitted that they are guilty of misconduct”.

Experience has taught Trewhella that an investigator should try to keep an open mind and look at all the circumstances surrounding the incident before deciding whether disciplinary action is warranted.

She explains that “if the organisation decides that disciplinary action is necessary a different manager should deal with the disciplinary process; they should be sufficiently senior and experienced in dealing with such matters and should not have been involved in the investigation”. During any disciplinary meeting, the employee should be allowed to bring either a colleague or a trade union representative with them as a companion, which is a legal right.

Beyond that, Trewhella says that if the disciplining manager decides that a sanction is warranted, “they should take into account the seriousness of the issue, the response of the employee to the allegation and their length of service and previous employment record”. Sanctions include a verbal or written warning or for more serious or repeated offences dismissal, either with or without notice. Demotion could also be considered if appropriate.

Chander says: “The key thing to remember is that an investigation is designed to uncover the facts rather than establish culpability.” In other words, no one should be assumed to be guilty.

It needs to be said that in some circumstances, an arrest elsewhere can lead to dismissal. In one case a hospital porter working for Nuffield Health was dismissed following a rape charge; the Tribunal found that his employer had followed due process and acted correctly. The porter had reported his arrest to his employer who investigated the matter, taking into account his categorical denial. However, because of the nature of his work with vulnerable patients the hospital had two options, either to suspend him on full pay or to dismiss him. But because he had no date for his trial, any suspension on full pay could have gone on for months, which was not tenable for a charity, so he was dismissed. The Tribunal ruled that his dismissal was fair as the employer had followed the correct procedure which, given the Nuffield’s charitable status, was not unreasonable. In the end the porter was acquitted and given his job back.

The risks of getting it wrong

It’s important that employers get the investigation and if necessary, the disciplinary process right. Put simply, if the dismissal isn’t handled properly, an employee could claim unfair dismissal and breach of contract. The maximum, basic award for unfair dismissal for an individual with at least two year’s service at the time of writing is £16,140, but an employer could face having to pay compensation up to a maximum of £88,519, or 52-weeks gross salary, whichever is the lower.”

In summary

Firms face threats every day. Some have to be lived with, some dealt with and others minimised. While it’s impossible to legislate for all situations, policies offer the best protection to employers; they also set the ground rules for disciplinary action.