10 October 2026
In an ideal world, employers and business owners wouldn’t need to deal with a team member committing an act that can be classified as misconduct or serious misconduct. However, as people leaders, we know that people problems are an inevitable part of having employees and running a business.
You might encounter misconduct and serious misconduct in the course of the employment lifecycle. Let’s go through what these are, how they’re different from each other, and when they might warrant HR help.
Misconduct generally refers to employee behaviour that breaches workplace policies, rules or the standards of conduct reasonably expected in their role.
Examples of behaviour that may constitute misconduct, depending on the circumstances, include:
Serious misconduct is defined under regulation 1.07 of the Fair Work Regulations 2009 (Cth). Serious misconduct is when an employee:
Examples of serious misconduct include (but are not limited to):
Circumstances must be assessed before deciding whether behaviour constitutes serious misconduct.
The distinction matters because it can affect the disciplinary action an employer considers and whether dismissal without notice may be justified. Depending on the circumstances, less serious misconduct may be addressed through counselling, clear expectations, training or warnings. Employers should assess the behaviour and follow a fair process before deciding on an outcome.
How about entitlements? Outstanding wages and unused annual leave remain payable, with long service leave payable in some circumstances (Fair Work Ombudsman).
However, serious misconduct does not automatically make a dismissal fair. Employers should still assess the facts and give the employee an opportunity to respond before deciding on dismissal. Small businesses also need to follow the Small Business Fair Dismissal Code when terminating an employee’s employment, and this must be considered when dealing with serious misconduct in a small business.
In Australia, these are the three examples of relevant laws that apply when it comes to misconduct and serious misconduct.
Regulation 1.07 under the FW Act defines serious misconduct and details the examples of behaviour that could fall under the classification.
The Sex Discrimination Act 1984 places a positive duty on employers to eliminate sexual harassment, sex-based discrimination, and victimisation in the workplace. This Act highlights the responsibility employers have in ensuring that their workplace is a safe and respectful one, free from gender-based discrimination and harassment.
Positive duty means taking reasonable and proportionate measures to eliminate relevant unlawful conduct as soon as possible.
The applicable legislation depends on the jurisdiction, and outlines what must be done to ensure the health, safety, and welfare of all workers. As with the Sex Discrimination Act, it emphasises the duty of that business owners have to ensure the health and safety of workers (plus those affected by the work they do).
These three laws and regulations are the legal framework for employers to manage and address any cases of misconduct.
Your employees cannot be expected to know the rules if they are not aware of them in the first place.
Having clear policies that set expectations and standards of behaviour is not enough. Employees also need to be able to have access to them and should know what each policy entails.
An employee handbook is one of the most effective ways to make employees aware of which policies you have in your business. At Now Actually, we create employee handbooks that also clearly outline what misconduct and serious misconduct are, as well as the consequences for incidents that constitute these.
In the event of an allegation of misconduct or serious misconduct being raised, knowing what to do and how to address it is key. Ignoring the issue or not responding appropriately can leave your business exposed to risk and worsen the situation.
Dealing with a complaint is not always straightforward. Not all complaints require an investigation, while some allegations are serious enough to warrant an independent third party.
We created a workplace complaint triage checklist that you can download here for free.
There are times when a business does not have an internal HR resource that can deal with an incident, especially when it’s one where serious misconduct or a serious breach of policy is involved. Our best practice recommendation for this is to always seek advice from an expert and mitigate any risk your company might be exposed to.
Need help with a complex incident or an impartial assessment? If you:
Why not give Now Actually a call? Our HR Partners have years of experience in dealing with tricky and complicated scenarios. Contact Now Actually today.
