Warning: Stop and think before sacking a lying thief

You would think that you could rightfully terminate an employee for stealing. SURELY you could at least sack a worker for lying about the theft when approached, right? Wrong!

When an employee is thought to be involved in serious misconduct, it is often tempting to immediately terminate the worker. However, making a heat-of-the-moment decision like this can lead to the employee winning an unfair dismissal claim.

A recent decision of the Fair Work Commission has turned the definition of “stealing” on its head, and has clarified what stealing in the workplace involves. The case saw a dismissed “liar” and “thief” win his job back, and compensation for loss of wages.

Milo-Man dismissed

Supermarket giant Coles terminated an employee for taking home Milo that was provided in the lunchroom. The worker often took a large serving home in his own container, however he always brought it back to work once he had mixed it with coffee, sugar, and drinking chocolate.

Coworkers saw him spooning mounds of Milo into a container and placing this in his bag. When Management was told, they had a security guard approach him and search his bag. When the guard asked him about the container, he said it was his and he brought it from home.

This employer was wise and stepped back to conduct an investigation, which included an interview with the “Milo-man.” At that interview, he admitted the Milo was actually from the lunchroom, not from his home, but explained he was shocked when the guard had asked him about it, hence his first untruthful answer.

Coles sacked the worker for stealing the Milo from the workplace, and then lying about it to the guard when first approached.

Was this theft?

The Commission found this was not a case of theft. Coles had provided the Milo for employees to use, in the workplace, and here Milo-man only consumed the product in the workplace, even though he took it home first to brew his special concoction.

As soon as an employee dispensed the Milo from the container, they had the right to use it however they wished to in the workplace. But if Milo-man was taking it to consume at home, this would then constitute stealing. This decision has implications in almost every industry. For example, in the building and construction industry, workers often take items like nails, screws, or tape. An employer would have the right to discipline, or maybe even terminate an employee, if company property is taken for personal use at home. However if the item is returned to site, and there is no proof that the employee intended to (permanently) deprive the business of the item, an employer should not act in the heat of the moment.

To reduce exposure when an employee is dismissed for stealing company items, employers must apply disciplinary policies consistently. Otherwise dismissing one employee for theft, and not another for stealing something similar, could render the dismissal unfair. Whatever rules are to put in place must be conveyed to the workforce, and obeyed by everyone.

Lies or conflicting stories

A “shocked and confused state” was the reason given by Milo-man for the lies told to the guard when he was first confronted. The Commission accepted this excuse for his lie, so they reinstated the worker, and awarded him significant damages for wages for the period between dismissal and the hearing.

We regard this as the more important part of the case. This could set a precedent of workers being let off the hook when their version of events changes between interviews.

Employers will often act on the information they first receive, without stepping back allowing the worker time to:

  1. Consider the particulars of the allegations against them;
  2. Gather their thoughts; and
  3. Allow the employee to respond at a separate meeting at a later date.

We are forever warning of the dangers of failing to conduct a proper investigation, and this is still a vital part of any termination process. This decision confirms that the Commission is willing to invalidate evidence that an employer obtains without following this proper process.

At the end of the day, if an investigation reveals inconsistent statements, a careful approach should be taken before making a decision to dismiss someone for lying. Thought needs to be given to when the first “story” was told and what frame of mind the employee was in at the time.

This case ought to serve as a reminder to all not to act in the heat of the moment, and not to assume that an employee’s conduct is “theft”, or that telling a lie is a sackable offence.


This article is general commentary on a topical issue and does not constitute legal advice. If you are concerned about any topics covered in this article, we recommend that you seek legal advice.


For further information please contact the author, Robert King, Partner – Employment, Workplace Relations & Safety (Brisbane), or Martin Alden, Partner – Employment, Workplace Relations & Safety.

The Author

Robert King