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Employee Code of Conduct: What is it and why is it important?

Clearly defining and enforcing Employee Code of Conduct is essential to keep your business compliant. Here is an overview of what it entails.
Published 28 Sep 2020
3 min read
Employee Code of Conduct: What is it and why is it important?

An employee code of conduct is an important document that clearly sets out expectations for employee behaviour and underpins a positive organisational culture.

Employee misconduct is one of the most complex areas that employers must navigate. The purpose of a workplace code of conduct is to remove any confusion around how to handle misconduct. This is done by establishing standards of behaviour and consequences for breaches. An employee code of conduct policy also provides legal protections in the case of unfair dismissal claims.

A code of conduct is an overarching document that often refers to other workplace policies. “Often a code of conduct can encompass a whole lot of other policies around bullying and sexual harassment…under the title of Code of Conduct,” says Alex Hattingh, Chief People Officer at Employment Hero. “It nicely summarises what is expected of employees.”

A code of conduct for employees must tick a range of boxes. It must comply with relevant legislation. It should be written in concise, easy-to-understand language and stored in locations that are easily accessible to all employees. Like an employee code of conduct policy, any workplace policy should be communicated to all staff. Employees should then sign off on the code after receiving comprehensive training in its contents.

The Queensland Government’s Business Queensland website offers a useful overview of what a code of conduct for employees should include:

  • Ethical principles reflecting the organisation’s commitment to ethics, integrity, and quality that underpin workplace behaviour;
  • The organisation’s values;
  • Accountability (taking responsibility for your own actions, ensuring the appropriate use of information, exercising diligence and duty of care obligations and avoiding conflicts of interest);
  • Standard of conduct (complying with the job description, commitment to the organisation, and appropriate use of digital devices, internet and email);
  • Standard of practice (current policies and operational procedures); and
  • Disciplinary actions including complaints handling and specific penalties for any violation of the code.

The code should reflect the company’s culture, address the relevant risk areas for the organisation and outline reporting procedures for unethical conduct.

Consider including examples of what constitutes appropriate and inappropriate behaviour to clarify issues that are ambiguous or prone to risk. It should be regularly reviewed and updated to ensure it complies with relevant legislation and best practice.

Enforcing the code

An employee code of conduct should be enforced with consistency and fairness. In the case of a breach of the code, the severity of disciplinary action should match the misconduct. To avoid unfair dismissal claims, extra training, formal and informal warnings can be offered before an employer resorts to termination of employment on the grounds of misconduct.

In 2019, the Fair Work Commission ordered a Sydney electrical contractor to rehire an employee who had been fired for becoming extremely intoxicated and behaving inappropriately at a work function. While the company felt her conduct had breached its code, the commissioner found that the penalty had been “harsh, unreasonable and unjust”.

When followed correctly, an employee workplace code of conduct can help remove ambiguity around what constitutes misconduct and what doesn’t. A former Sydney Trains worker lost his job after he sent a lewd unsolicited photograph to his colleague’s phone. When the worker appealed his employer’s decision to terminate his employment, the Fair Work Commission found that his behaviour “overstepped the boundaries of acceptable conduct” and, as a result, his dismissal was justified.

To help remove this ambiguity around misconduct, be sure to download our Essential Guide to HR Compliance.

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The essential guide to HR compliance

The Team
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