Dismissing someone for fraud (Possibly)

[revs88]

Hi guys - I would welcome some advice on a matter that I'm probably making more complicated than what it needs to be.

A friend of mine has a part-time employee who works 2 days per week and he is their main PAYE employee. He has employed them on this basis for the last 3 years,

They have signed a full-time employment (5 day per week) contract which states that the hours of work are by arrangement with their manager unless otherwise arranged.

He has always wanted them to work Saturdays, his busiest day, but they have always stated they have childcare responsibilities that day and are unable to work.

He has now found out they work Saturdays for a competitor and receive a cash in hand payment. They have also boasted to his employees that this money is not declared to the Inland Revenue (He has written statements supporting this).

My question has 4 parts:

1) Can he dismiss the employee for fraud even though the fraud is committed against the tax man and not his business.

2) Lying about not being able to work for Saturdays is a case for gross misconduct?

3) If not, what notice does he have to give the employee to start working for him on Saturday?

4) If they say they can't work Saturdays can he dismiss for breach of contract.

Thanks, Richard

[SLCZ3]

revs88 said:

Hi guys - I would welcome some advice on a matter that I'm probably making more complicated than what it needs to be.

A friend of mine has a part-time employee who works 2 days per week and he is their main PAYE employee. He has employed them on this basis for the last 3 years,

They have signed a full-time employment (5 day per week) contract which states that the hours of work are by arrangement with their manager unless otherwise arranged.

He has always wanted them to work Saturdays, his busiest day, but they have always stated they have childcare responsibilities that day and are unable to work.

He has now found out they work Saturdays for a competitor and receive a cash in hand payment. They have also boasted to his employees that this money is not declared to the Inland Revenue (He has written statements supporting this).

My question has 4 parts:

1) Can he dismiss the employee for fraud even though the fraud is committed against the tax man and not his business.

2) Lying about not being able to work for Saturdays is a case for gross misconduct?

3) If not, what notice does he have to give the employee to start working for him on Saturday?

4) If they say they can't work Saturdays can he dismiss for breach of contract.

Thanks, Richard

I would think that it would be better to try and get rid of the guy, as he cannot be trusted, but until a replacement can be found, bubble him to the local tax office, he will need to come up with money to pay his back tax, which will be an incentive for the guy to work on the saturday and give your mate the upper hand.

[E Ponym]

SLCZ3 said:

revs88 said:

They have signed a full-time employment (5 day per week) contract which states that the hours of work are by arrangement with their manager unless otherwise arranged.

Make sure that the hours of work are "arranged" for saturday only.

Russ

[Eric Mc]

Does his contract state that he may be asked to work Saturdays?

Did he agree that contract (i.e. sign it)?

If so, does the fact that he hasn't been asked to work Saturdays amount to a verbal amendement to the original employment terms or is it a concession made by his employer, so far, out of the goodness of his heart?

I would start scheduling some Saturday work for him and see how he reacts.

[edc]

The detail in the contract sounds so vague as to suggest that there is actually no obligaton to work any particular day of the week. I think you are on quite tenuous grounds to dismiss for gross misconduct. There may be a slim case for redundancy but why not just have a Frank conversation or hire a Saturday worker?

[anonymous-user]

This guy needs to go asap! He has lied about saturday commitments so he can work for a competitor. He should find someone who will work the hours he needs and in the current economic climate it should not be too hard to do!

[revs88]

Hi Guys,

Thanks for your comments so far.

It would have helped if I put the full clause regarding work hours:

"The [company X] is open for business between the hours of 9-5.30pm Monday to Friday and 8.30 to 5pm on Saturday. You are required, unless otherwise arranged, to work five days per week by arrangement with your manager."

They have signed a contract accepting these terms.

Cheers, Richard

[edc]

revs88 said:

Hi Guys,

Thanks for your comments so far.

It would have helped if I put the full clause regarding work hours:

"The [company X] is open for business between the hours of 9-5.30pm Monday to Friday and 8.30 to 5pm on Saturday. You are required, unless otherwise arranged, to work five days per week by arrangement with your manager."

They have signed a contract accepting these terms.

Cheers, Richard

On this basis there is no obligation to work Saturdays. The contractual term is too loose.

[Eric Mc]

There appears to be no obligation to work any specific days at all. Would Saturday be considered "a normal working day" in the context of that particular job. If it was, then the fact that Saturday is not specifically mentioned in the contract would not exclude Saturday working as a normal aspect of that job.

[Kudos]

Just to add, I don't see were the fraud bit comes from so drop those accusations PDQ

[anonymous-user]

Kudos said:

Just to add, I don't see were the fraud bit comes from so drop those accusations PDQ

Not declaring to the tax man is fraud

[Kudos]

MonkeyMatt said:

Kudos said:

Just to add, I don't see were the fraud bit comes from so drop those accusations PDQ

Not declaring to the tax man is fraud

Surely that's tax evasion, not fraud?

[Eric Mc]

MonkeyMatt said:

Kudos said:

Just to add, I don't see were the fraud bit comes from so drop those accusations PDQ

Not declaring to the tax man is fraud

Not an issue of any significance in respect of the relationship between the employer and his employee.
Obviously, the employer, as a conscientious independent citizen, might want to "shop" this individual on the basis that he is "suspicious" that he might be engaged in tax and NI fraud - but in his role as employer to that said individual, he can only act in respect of any wrong doings the individual might have perpetrated in the course of his employment.

[Eric Mc]

Kudos said:

MonkeyMatt said:

Kudos said:

Just to add, I don't see were the fraud bit comes from so drop those accusations PDQ

Not declaring to the tax man is fraud

Surely that's tax evasion, not fraud?

Tax evasion IS "fraud".

And like any "fraud", it is a criminal offence and therefore requires the standards of proof required in a criminal court for a charge to stick i.e. beyond reasonable doubt.

[Kudos]

Eric Mc said:

Kudos said:

MonkeyMatt said:

Kudos said:

Just to add, I don't see were the fraud bit comes from so drop those accusations PDQ

Not declaring to the tax man is fraud

Surely that's tax evasion, not fraud?

Tax evasion IS "fraud".

And like any "fraud", it is a criminal offence and therefore requires the standards of proof required in a criminal court for a charge to stick i.e. beyond reasonable doubt.

Technically, but you would be charged with tax evasion, not fraud.
OP proving this would be difficult, so I really wouldn't go there. Spend the effort get rid of person without making accusations which may come back and bite

[Eric Mc]

Kudos said:

Eric Mc said:

Kudos said:

MonkeyMatt said:

Kudos said:

Just to add, I don't see were the fraud bit comes from so drop those accusations PDQ

Not declaring to the tax man is fraud

Surely that's tax evasion, not fraud?

Tax evasion IS "fraud".

And like any "fraud", it is a criminal offence and therefore requires the standards of proof required in a criminal court for a charge to stick i.e. beyond reasonable doubt.

Technically, but you would be charged with tax evasion, not fraud.
OP proving this would be difficult, so I really wouldn't go there. Spend the effort get rid of person without making accusations which may come back and bite

We accountants are supposed to report tax evasion as "serious fraud". The cutrrent body we report to is the Serious and Organised Crime Authority - SOCA - although that is supposed to be changing as SOCA is absorbed into the Fraud Office.

[Jasper Gilder]

Much confusion here

If the individual has committed fraud ( I'm not sure) it isn't against their employer and so it isn't an employment issue

What they may have done is committed the offence of bad conduct outside working hours. This is a conduct offence if it can be shown that there is a link to their employment. But.. a person cannot be forced to work against their will.

I'd go down the conduct route of lying and bad conduct OOWH - but I wouldn't be brimming with confidence

[J T]

Kudos said:

MonkeyMatt said:

Kudos said:

Just to add, I don't see were the fraud bit comes from so drop those accusations PDQ

Not declaring to the tax man is fraud

Surely that's tax evasion, not fraud?

It is fraud, but this fraud has nothing to do with the employer who made the origninal post. The employee has done nothing fraudulent with regards to his employment, therefore there can be no grounds for dismissal on this basis. I guess it would be like the situation where an employee grows drugs at his house; it is an illegal act, but not in the course of his employment.

I would agree with the above, and would not see it a good idea to accuse the employee of any sort of fraud.

[FamilyGuy]

I'm interested to see how this pans out. There are many employers who state that you cannot work for them if you have a criminal record - the finance industry springs to mind. So although the suggested fraud is regarding HMRC, a conviction might enable the person's current employer to relinquish them.

[lestag]

1) its not fraud or tax evasion until proven - by the authorities.
2) the term "by arrangment" could possibly infer mutual agreement or discussion
3) i am not an employement lawyer, your friend needs one in terms of the employment contract