Tuesday, 31 December 2013

‘Mystery Shopping’ The Workplace

Some employers have opted to engage external contractors to pose as employees to observe the conduct of their employees – in much the same way that mystery shoppers are used to evaluate retail services.

A recent decision of the Fair Work Commission (FWC) has considered the implications of placing a contractor into a workforce, and whether the dismissal of an employee, solely on the basis of a report provided by that contractor, was unfair.


The employer in this case had hired a contractor to pose as an employee in their workforce in order to spy on a certain employee. The contractor subsequently decided to also observe and record the conduct of other employees in the workforce as they were having difficulty gaining access to the individual in question. In particular, the contractor noted the actions of a supervisor who had been with the employer for 25 years.

The contractor provided a report to the employer about the supervisor’s actions, which included a statement the supervisor allegedly made to an employee under his direct supervision to the effect of: ‘I don’t care what you do, just don’t get caught, don’t make me have to explain why you are doing nothing’. The contractor reported that, in making this statement the supervisor was actively encouraging this employee to disregard the requirements of his job. The contractor also claimed that the supervisor failed to effectively monitor and supervise the work output of this employee, resulting in him failing to properly perform his work duties.

On the basis of the report provided by the contractor, the employer summarily dismissed the supervisor. The employer did not provide the supervisor with any formal warnings, nor did it attempt to provide him the opportunity to improve his performance.

Dismissal was unfair

FWC found the decision to terminate the supervisor’s employment was harsh, unjust and unreasonable. The FWC ordered reinstatement and payment of remuneration for the period the supervisor was out of work.

Lessons for employers

If an employer decides to ‘mystery shop’ their workplace, this case offers some useful guidance:

  • Ensure that the contracted ‘shopper’ is impartial and operates within clearly defined parameters (in this case the particular contractor took personal issue with the manner in which the supervisor conducted his work, and believed the supervisor was blocking them from accessing the employee they were hired to observe)
  • In the event that disciplinary action is required to be taken, the employer should first conduct its own investigations before making any decisions
  • The employer should ensure it follows its own internal procedures in relation to performance management and disciplinary action in order to ensure the outcome is procedurally fair

If you are experiencing issues with the workplace conduct of your employees HR Legal can assist with minimising the risk of unfair dismissal, or other claims, arising if an employee’s employment is ultimately terminated.


This article was produced by HR Legal. It is intended to provide general information only in summary format on legal issues. It does not constitute legal advice, and should not be relied on as such.