Disciplinary actions are necessary for employers in order to appropriately and effectively address employee wrongdoing and ensure adherence to the requirements of the workplace. The law requires the employer to specify disciplinary actions in its work rules.
However, the law is silent on what kinds of disciplinary actions should be taken and for what offences. Therefore, employers have discretion to specify and apply a range of actions within the workplace — as long as they are fair and reasonable.
The most common disciplinary actions are verbal or written warnings, suspension with or without pay, and termination of employment. Applying appropriate disciplinary actions depends on many factors, including the seriousness of the offence. A written warning tends to be suitable for less serious offences, while suspension of employment may be more appropriate for rather serious or severe offences.
In this regard, an employer may give a written warning to the employee in response to the offence committed. The employer is then legally entitled to terminate the employee immediately without severance pay if the employee commits the same offence within one year from the date of the first violation.
Questions may arise in a case where the offence requires suspension with or without pay. First, is the suspension letter in itself considered a warning letter under the law? If so, the employer is entitled to terminate the employee immediately without severance pay should the employee commit the same offence again within one year.
If the suspension letter is not a warning letter, would this mean that by opting to suspend the employee, the employer forgoes the right to issue a written warning for that offence? In other words, the employer is left with suspension as the only disciplinary action, and if the employee repeats the same offence within one year from the first violation, the employer still cannot terminate him without severance pay.
The Supreme Court shed some light on this issue a while back by ruling that a suspension notice containing sufficient warning specified within is considered a written warning under the law. In the case in question, the court was asked whether the warning in the suspension notice would be cancelled once the employee completed the suspension period and if the work suspension letter should be considered as a written warning. The court ruled that such warning was valid and would not be cancelled even after the employee completed the suspension period.
Consequently, the employer could rely on the suspension notice containing sufficient warning as a written warning under the law. As the employee in that case repeated the same offence specified under the suspension letter within one, the employer was legally entitled to terminate the employee immediately without severance pay.
More recently, the Supreme Court has had the opportunity to revisit this issue and provide additional clarification. In a subsequent case, it looked into the employer’s work rules and pointed out that they only allowed the employer to take one of the disciplinary actions available (as opposed to more than one). Hence, suspending and warning the employee for the same offence was not permissible under the employer’s work rules. Accordingly, the said suspension letter was not considered a written warning under the law.
In light of the two interesting court decisions above, even though the employer is legally entitled to discipline the employee by both suspension and a written warning by issuing a suspension letter containing a warning, employers should be careful not to limit such rights in its own work rules and policies. Lessons that employers should take from these decisions are:
Work rules should be drafted to give flexibility to the employer when taking disciplinary actions against employees. For example, they should specify clearly that the employer is entitled to take one or more actions against the employee, as appropriate.
Any disciplinary letter, including a suspension letter, should contain sufficient warning wording, e.g. warning the employee not to commit the same offence again or else he or she will be subject to harsher actions.
The letter should also clearly state the types of disciplinary actions taken against the employee for the offence in question, e.g. work suspension and written warning.
Suriyong Tungsuwan is a partner and Nam-Ake Lekfuangfu and Theeranit Pongpanarat are associates with Baker & McKenzie Ltd.