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Are employees robbing you blind? Follow KFC's example to fire them legally

by , 15 December 2014
Employee theft is a huge problem for many companies.

In fact, according to referenceforbusiness.com, corporate security experts estimate that 25% to 40% of all employees steal from their employers.

One KFC outlet learnt this the hard way.

It reveals it lost 245 pieces of chicken and 63kg of chips in just three days. Before this, 424 cans of cold drink and 518 cans of juice went missing in two shifts.

Shockingly, the franchises' employees didn't admit to the stock losses which cost between R80 000 and R120 000 a month. And the theft didn't stop despite warnings.

To solve the problem, KFC dismissed 11 of its employees. And guess what? After more than three years of court proceedings, last week, the Labour Court found KFC's decision was correct.

So how did KFC get it right?

And more importantly, how can you also make sure dismissals for theft are legal?

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KFC did the following to legally dismiss its employees for theft

According to iol.co.za, after noticing stock theft, the company told its employees about its 'zero tolerance' policy towards theft. And reiterated that they were responsible for stock during their shift.
The company then put these measures in place:
  • It got a guard to patrol the premise and search employee's bags;
  • It put CCTV cameras and a system to capture all activities at the till; and
  • Put locks on freezers and storerooms.
When these measures didn't work – the company asked its employees to help it catch the thieves, but, didn't get any help.
It then had a disciplinary hearing for 11 employees who worked the late shift. After a guilty verdict, it dismissed them.
Now initially, the employees went to the CCMA claiming unfair dismissal and won their case.
But the company didn't take CCMA's order to pay six months' compensation to each of them lying down. It went to the Labour Court to appeal. And it won its case this week.
The reason?
According to the judge, KFC didn't have to prove individual guilt to dismiss. It's enough that the individual they suspect of misconduct is a member of a team that didn't meet its duties (to ensure there wasn't any stock loss). And dismissal is fair because the team didn't come clean even though they had a chance to.
What's more, these employees have to pay the costs of the review application too.
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To win your dismissal case too, you need to do the following

The first thing you need to know is, the correct offense for firing a group of employees like this is 'derivative misconduct.'
You see, your employees have a duty to be loyal to your company, says the Labour Law for Managers Loose Leaf Service. They have to help you identify those who commit misconduct in your company. If they don't, they break the trust relationship. Trust is a key requirement in your employment relationship. This means, you can fire them.
To do this successfully:
  1. Have a policy that says you don't tolerate theft and make your employees aware of it and the consequences of breaching it;
  1. Put measures in place to prove your employee's wrong doing (i.e. have CCTV cameras and make sure your employees know about them);
  1. Hold a disciplinary hearing and make sure it's substantively and procedurally fair.
To justify dismissal you must:
  • Prove misconduct took place;
  • But, you can't identify the culprits;
  • Your employees know about the misconduct or did take part; and
  • Despite an opportunity to do so, your employees didn't help you identify perpetrators.
Once you prove all this, your employees must show they didn't take part or don't know anything about the misconduct. If they can't, you can assume guilt by association. And you can dismiss because you can't trust them anymore.
This case highlights the importance of following proper disciplinary procedures and acting in a fair manner when it comes to dismissals. It's clear that KFC did this well. That's why it won in the end. You can too if you take a page from their book.
PS: For more information on dismissals, check out You're fired!' Your guide to substantively and procedurally fair dismissals.

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