Hi, welcome to Just Answer. I will help you with your question.
You say you set up the business with a friend seven years ago, so is he also a director of the company in addition to being an employee?
And does he own shares in the company?
Okay. But he is an employee?
Okay. Clearly, if he has stolen money from the company (which seems to be the case from what you have said) then that would amount to gross misconduct. This would entitle you to dismiss him without notice.
However, you should ensure that you carry out a proper investigation, to make sure that you have your facts straight.
It's often appropriate in these cases to suspend the employee for a short period of time, whilst gathering your evidence, such as by contacting the relevant customers concerned. I know you've already done this with one customer, but there may be others worthy of investigation.
The fact he does not have a written contract does not mean that you cannot dismiss him. You can still dismiss him.
There is a very useful guidance note from ACAS that you may wish to consider here: http://www.acas.org.uk/media/pdf/s/o/Acas-Guide-on-discipline-and-grievances_at_work_(April_11)-accessible-version-may-2012.pdf
You should put in writing, although strictly there is no legal requirement to do so, it is the most appropriate thing to do.
But as I mentioned above, he should be given the opportunity to respond to the points that you make, and the formal meeting is the best place the most appropriate way to deal with that. This is covered in detail in the guide that I have referred you too.
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That is true, although there may be other examples that you wish to query, and put to him? The consequences of being dismissed are, of course, very important and significant. It is therefore essential that you are rigourous with your investigations.
And although you may have sufficient evidence already to justify dismissal without notice, you have to follow a fair procedure as part of that process.
If you fail to follow the correct procedure, such as suspending and holding a formal meeting, then the dismissal may be considered unfair by tribunal. Is always best to act with a cool head, and rationally, and follow the appropriate procedures.
Does this answer your question this morning, or is there anything else I can help with?
There are two parts to a disciplinary/dismissal process. The first is the reason for the dismissal. Clearly, here, you have sufficient grounds to dismiss. The second part is the procedure that is used to dismiss.
Both parts have to be "fair" in order for the dismissal itself to be considered fair. If you fail to follow a correct procedure, even though you have good reason to dismiss, it can still be considered unfair.
The ACAS guidance note does set this out clearly for you.
Here is an additional guidance notes on the same point: http://www.cipd.co.uk/NR/rdonlyres/44BE626C-3F04-4266-A835-41E763D58912/0/Fairdismissalprocedures.pdf
If you want to be absolutely in the right, and avoid the prospect of any claim succeeding against you, it is worth suspending him for a few days and doing this in the manner suggested. I know it is frustrating, particularly when you appear to have everything in order, but the law is the law.
I hope this answers your question. If you need further information, just let me know. Please do remember to rate my answer as highly as you can.
I should have added, that the offer of months wages will not amount to an suspension. It may, however, have the same practical effect for you, and it is therefore sensible to follow the suspension route, and reduce your ultimate offer afterwards if you want to do a deal with him.
Does this answer your question?
I would add, you can instantly dismiss if you're satisfied that nothing else will come out of this, and that his explanation isn't going to be different. The proper procedure is always the best way, it puts things in a formal context, but if you really want to, then just make sure you have notes/records of what his explanation is etc. should you need to rely on it later. It's more risky doing things this way, but in theory, you can do it.
Are you there?