Hamish Cameron Blackie discusses how businesses can best deal with inappropriate behaviour by staff who represent them at Christmas parties and social events, including what policies to have in place and what disciplinary action to take

In 2006 Theresa Davies, a female vicar from Northamptonshire, shocked colleagues with an unexpected confession at her Christmas lunch that she and her husband went to swinging (wife-swapping) parties.

The comments came to the attention of the church authorities who took action in the form of an internal tribunal hearing. The tribunal found that her behaviour was “scandalous” and determined that she should be dismissed. Her actions had brought her employer into disrepute, even though apparently she had done nothing illegal, she was well thought of by a number of her parishioners, and anything she had done had not been done in the course of her employment.

The case highlights the danger of a tongue loosened by the effect of alcohol and reminds those of us who enjoy a drink from time to time to show restraint, especially at Christmas time.

The courts and tribunals are not totally insensitive to words said whilst under the influence of drink, especially where the words are said under the influence of alcohol purchased by the employer. Williams and Ors v Whitbread Beer Company is a Court of Appeal authority for the proposition that where an employer has condoned drinking in the course of employment, this is something which ought to be weighed in the balance when considering the conduct of the employee under the influence of that alcohol.

Best endeavours

Many senior employees will have an express provision in their service agreements that they must use their best endeavours to promote the interests and reputation of their employer, and not do anything to its detriment. Such a provision is an explicit rendering of one aspect of the implied duty of good faith.

However, it can do no harm to set out this duty in writing and remind senior employees of it from time to time, whether they are directors or not. A provision to this effect could be introduced to the contracts of existing employees provided that a sensitive procedure was followed for changing terms and conditions.

For directors of companies, a duty to act in a way they consider would promote the success of a company is a statutory requirement contained in The Companies Act 2006 Section 172. Dismissal following a breach of such a duty would probably fall within the broad range of reasonable responses, though undoubtedly each case would turn on its own facts. There can be little doubt that all employees are under an implied term that they shall not bring their employer into disrepute, and that a breach of that duty can give rise to a fair dismissal.

However, what does and does not amount to bringing an employer into disrepute is not a straightforward matter, as was recognised in the Court of Appeal case in Post Office v Liddiard (2001). Memories of the events may now be fading, but there was massive press interest in the standard of behaviour of English football fans in Marseille at the Football World Cup in 1998. Mr Liddiard became the focus point of that press interest having been caught on camera in violent conduct and identified as being an employee of the Post Office. With the encouragement of the Prime Minister no less, the Post Office dismissed Mr Liddiard for his conduct in Marseille on the basis (amongst other things) that his conduct brought the Post Office into disrepute.

The question whether he had was not an easy one. Mr Liddiard worked in a sorting office and was not in a public-facing position. His conduct was not associated in any way with the manner in which the Post Office performed its duties, and his out-of-office hours activity did not directly impact on the reputation of the Post Office. The Court of Appeal held that he had not been dismissed fairly for procedural reasons, but its decision implied that sometimes dismissals for conduct unconnected to the workplace may be justified depending on how public the employee’s behaviour is, and whether it causes any damage to the employer’s business.

Reputational damage

But what of the position where the conduct is legal, but still causes reputational damage? Under the Equality Act, it is unlawful to discriminate against employees on the grounds of their political beliefs but with the recent publication of the BNP list of members, employees of the Police Force and school teachers have been suspended on the grounds that their political views, whilst legal, have the effect of bringing their employers into disrepute.

The issue is as yet undecided but in terms of deciding whether a dismissal would be fair, if negative publicity became focussed upon the legal but unpopular activity of a member of staff it is likely that a tribunal would carry out a balancing act between the rights of the employee to profess those beliefs, the reputation of the employer and the degree of damage that would be occasioned to that reputation in the medium and long term, if the employee was not dismissed. The issues of freedom of speech and freedom of expression would be at a forefront.

In order to address the risks that employers face in terms of brand and reputation management, employers might well consider drafting a policy on behaviour and statements made both during and outside work that may cause damage to the employers reputation. However, care must be taken to ensure that such policies do not infringe statutory rights under the Equality Act or the right to whistleblow under the Public Interest Disclosure Act.

Hamish Cameron Blackie is a partner at Barlow Robbins LLP.