A WORKPLACE culture of alcohol consumption has cost an insurance firm more than $235,000 after a New South Wales District Court ruled a management-level employee was wrongfully dismissed for arriving inebriated to a staff training conference.

The former general manager of Willis Australia Group commenced proceedings in pursuit of damages for wrongful termination after he became intoxicated at a work function and fell asleep on a bench near his hotel room.

The following morning, at a staff training meeting to which he arrived an hour late, other employees reported the general manager smelled strongly of alcohol, slurred his words and was unsteady on his feet.

The incident led to his early return from the conference, and subsequent dismissal on grounds of gross misconduct several days later.

The employer argued the GM had engaged in gross misconduct by arriving to a staff meeting intoxicated, contravening the company’s policies and consequently the manager’s employment contract.

However, Judge Taylor Phillip disagreed, citing the company’s approach to alcohol consumption as ‘relevant to the seriousness that should be attributed to intoxication’.

“The cost of the alcohol so consumed was routinely, and was on this occasions, met or reimbursed by Willis, irrespective of the quantity of alcohol consumed or the ultimate level of intoxication of the participants,” he said.

“Standing along, these matters do not enhance the seriousness of the intoxication, or suggest that it involved a significant departure from common company standards.”

Further, Phillip J noted the policy stipulated intoxication as gross misconduct only where it ‘could seriously damage Willis’ reputation’ or ‘which endangers the wellbeing of Willis staff’.

“A proper reading of the contract of employment, including the Willis policies, read in the context of Willis practices in relation to alcohol, indicates that intoxication at work, of itself, is not sufficient to warrant summary dismissal for gross misconduct,” he said.

“Something more is required, some aggravating conduct such as repetition of the intoxication, a severe level of intoxication, adverse impact on employee or client safety, violence, offensive conduct or offensive language, a serious impact on reputation or significant financial loss.

“None of those features or other aggravating features exist in this case.”

The insurance company was ordered to pay damages of $296,650.75 to the former general manager.

Click here to read the decision in full.

Implications for Employers

This case is an important benchmark for employers as it highlights the significant issue that intoxication while at work may not always warrant summary dismissal, particularly where company policies are somewhat ambiguous.

For resource employers, it is critical to ensure company policies clearly outline and communicate to workers the organisational drug and alcohol policies, including any testing requirements associated with employment contracts.

This ruling, delivered in December, is a particularly timely reminder for all employers to clarify what is expected of their employees at staff Christmas parties and other end-of-year functions where alcohol may be served.

AMMA’s workplace relations experts can provide guidance on how to mitigate the impacts of drugs and alcohol in the workforce, and/or update your company’s disciplinary policies when it comes to alcohol consumption and misconduct. Contact your local AMMA office for more information.