Finding (or suspecting) that an employee is intoxicated or drunk at work is one of those situations that can throw even experienced business owners off. You’re balancing safety, fairness, your other staff’s wellbeing, customer trust, and the very real legal risk of getting the response wrong.
In Australia, an employee being drunk at work can create serious work health and safety (WHS) issues, but it can also become an unfair dismissal or general protections issue if you move too quickly or don’t follow a fair process.
The good news is there is a practical, legally safer way to handle it. Below, we step through what to do in the moment, how to document and investigate, when dismissal might be justified, and how to reduce the risk of claims later.
Why “Drunk At Work” Is A Serious Legal Risk For Employers
When an employee is drunk at work, the issue is rarely “just” performance. It can touch multiple legal and commercial risks at once.
1) Work Health And Safety (WHS) obligations
Under WHS laws, you have a duty to provide a safe workplace. Alcohol impairment can increase the risk of accidents, injuries, and dangerous decisions, particularly in workplaces involving:
- vehicles or driving
- machinery or tools
- working at heights
- handling hazardous substances
- customer-facing situations where aggression or poor judgement could escalate
If you ignore a clear safety risk, your business could be exposed to regulatory action if something goes wrong.
2) Potential liability and reputational risk
If an intoxicated employee injures someone (a colleague, customer, supplier, or member of the public), your business may face legal exposure and reputational damage. Depending on the circumstances, this could include claims in negligence, workers’ compensation issues, or regulatory scrutiny - and employers can sometimes be held responsible for conduct connected with employment (even if the employee is “the one at fault”).
3) Employment law risk (unfair dismissal and adverse action)
Even where there’s genuine misconduct, employees can still bring claims if the process is handled poorly. Common risk points include:
- dismissing immediately without a reasonable investigation
- not giving the employee a chance to respond
- inconsistent treatment (e.g. one employee is dismissed, another is “let off”)
- failing to consider whether a medical condition or disability may be involved
This is why it’s important to respond promptly, but also methodically.
When you suspect someone is drunk at work, your first priority should be safety - but you also want to protect the fairness of any later disciplinary process.
Step 1: Stay calm and assess safety risk
Ask yourself: are they fit to continue working right now?
If they operate equipment, drive, handle cash, supervise others, or interact with customers, it is often not safe (or reasonable) to allow them to continue.
Step 2: Remove them from risk (discreetly)
Have a manager (ideally with a witness) ask the employee to stop work and move to a private area.
Keep the conversation factual and non-accusatory. For example:
- “We’re concerned you may not be fit for work today.”
- “For safety reasons, we’re going to pause your shift while we work out what’s going on.”
Avoid labelling them as “drunk” as a statement of fact unless you have clear evidence (like an admission or a breath test result). Focus on observable behaviour.
Step 3: Arrange safe transport home
If the employee may be intoxicated, don’t let them drive home or operate a vehicle. Arrange a taxi/rideshare or ask a family member to collect them. Document what you did to manage safety.
Step 4: Consider whether you can stand them down (with care)
Many employers use a short stand-down (or a direction not to attend the workplace) while they investigate what happened - particularly if there’s a safety risk or the employee’s presence could impact the workplace.
This is a situation where getting advice early helps, because whether a stand-down is lawful (and whether it is paid/unpaid) depends on the legal basis you’re relying on. It may be influenced by the Fair Work Act, an applicable award or enterprise agreement, and the employee’s contract. In some cases, a standing down an employee pending investigation may be an option, but it needs to be handled carefully.
Step 5: Do not “investigate” on the spot
In the moment, your goal is to manage risk, not run a full disciplinary interview. If you push too hard while they’re impaired, you can end up with unreliable admissions, heightened conflict, or procedural unfairness.
Instead, tell them you will meet with them (when they are fit) to discuss what occurred.
Documenting Evidence Without Escalating The Situation
If this incident later becomes a disciplinary process or a termination, your notes and records matter. They help show that you acted reasonably, consistently, and based on evidence - not assumptions.
What to record
As soon as practical, record:
- date, time, and location
- who observed the behaviour
- what was observed (facts, not opinions)
- any relevant safety risks (e.g. employee was about to drive a forklift)
- what instructions were given
- how the employee responded
- how they got home safely
Examples of factual observations include “smell of alcohol on breath,” “slurred speech,” “unsteady walking,” “agitated behaviour,” or “admitted to drinking during lunch break.”
Should you record the conversation?
Be cautious. Recording laws differ between states and territories, and workplace recording can create privacy and employee relations issues.
If your business is thinking about recording conversations (whether on phones or in person), it’s worth checking recording laws in Australia first, and having clear workplace policies around surveillance and privacy.
Drug and alcohol testing
Testing can be useful, but it isn’t as simple as “just do a breath test.” Whether testing is lawful and reasonable depends on your workplace, the role, the safety risk, and whether you have a policy and procedure in place (and apply it consistently).
If you want testing to be part of your approach, ensure your business has clear documentation and consent pathways. Many employers align this with broader workplace safety processes, including drug testing employees guidance (noting alcohol testing often sits within similar “fitness for work” frameworks).
Investigation And Procedural Fairness: How To Avoid An Unfair Dismissal Claim
Even if you’re confident the employee was drunk at work, you’ll usually reduce legal risk by following a fair process. This matters because unfair dismissal claims often focus as much on how you dismissed as why.
Step 1: Check your documents (contract, policies, award)
Before you take disciplinary action, check:
- the employee’s Employment Contract (especially conduct, alcohol, and disciplinary clauses)
- your workplace policy on drugs and alcohol, WHS, and conduct (often consolidated in a Workplace Policy set)
- any modern award or enterprise agreement obligations (some have specific disciplinary steps)
If your documents are unclear or outdated, that can increase risk. It can also lead to inconsistent decision-making across managers.
Step 2: Invite the employee to a meeting (when fit for duty)
Once the employee is sober and fit to participate, invite them to a meeting to discuss the allegations.
In many workplaces, it’s best practice to:
- provide the concerns in writing (even briefly)
- allow a support person (especially if serious disciplinary action is possible)
- give them a reasonable chance to respond
Step 3: Consider whether this is misconduct or a health issue
“Drunk at work” can be misconduct, but sometimes it intersects with health issues such as alcohol dependency. That doesn’t mean you must ignore safety or keep someone in a role where they create risk - but it does mean you should consider whether reasonable adjustments, leave, or support options are relevant.
The key is not to jump straight to assumptions. Ask questions, listen, and document the response.
Step 4: Decide on an outcome that matches the evidence and risk
Possible outcomes might include:
- no action (if allegation not substantiated)
- counselling and a clear warning
- a final warning (if serious, or repeat incident)
- mandatory participation in support programs (where appropriate and lawful)
- role changes (temporary or permanent), if needed to manage safety
- termination of employment (including summary dismissal in serious cases)
The more serious the risk and the clearer the evidence, the more defensible strong disciplinary action tends to be - but process still matters.
Can You Dismiss Someone For Being Drunk At Work?
Sometimes, yes - but it depends on the circumstances.
In many Australian workplaces, being drunk at work can amount to misconduct or serious misconduct, particularly where it creates safety risks or breaches a clear workplace policy. However, dismissal decisions should be made carefully and consistently.
When dismissal may be more defensible
Termination is generally more likely to be defensible where:
- there is a clear workplace policy and the employee understood it
- their role is safety-critical (driving, machinery, medical care, security, etc.)
- there is strong evidence of intoxication (admission, test result, multiple witnesses)
- they placed others at risk, caused an incident, or damaged property
- it is a repeat incident (especially after prior warnings)
You should be more cautious where:
- the evidence is weak or based on one person’s impression
- you have no policy (or you’ve never enforced it consistently)
- there may be a medical issue involved and you haven’t explored it
- the employee is within the unfair dismissal jurisdiction and you haven’t followed a fair process
What about summary dismissal?
Summary dismissal is termination without notice. It is generally reserved for serious misconduct.
Even where summary dismissal may be available, you’ll still reduce risk by ensuring:
- you investigated sufficiently for the circumstances (which may still be a quick investigation in clear cases)
- the employee had a chance to respond (usually when they are fit to do so)
- you can explain why the conduct was serious (especially any WHS risk)
- your decision is consistent with how you treat similar cases
If termination is on the table, it’s worth speaking with an employment lawyer before you make the final call, especially if the employee is long-serving, union-supported, or the facts are disputed.
Notice, final pay, and “payment in lieu”
If you terminate with notice (rather than summary dismissal), you may choose to pay the notice period instead of having the employee work it - particularly if the relationship is damaged or there are safety concerns.
This is commonly referred to as payment in lieu of notice.
Be careful here: final pay calculations and entitlements can vary depending on the contract, award coverage, and the reason for termination. If you’re unsure, it’s better to check before processing payroll.
Prevention: Policies And Practical Tips To Reduce Future Incidents
Most business owners don’t want to be dealing with drunk at work incidents at all. Prevention is where you can make the biggest difference - and it also makes disciplinary action easier to defend if an incident happens.
Have a clear drug and alcohol policy (and enforce it consistently)
Your policy should cover things like:
- fitness for work expectations
- whether alcohol is permitted at work events or lunches
- testing (if applicable) and what happens if an employee refuses
- reporting obligations (e.g. managers must escalate safety concerns)
- consequences for breaches (warnings through to termination)
It’s not enough to have a policy in a folder. You should train managers and communicate expectations to staff, including what will happen if someone appears impaired.
Make your Employment Contracts work for you
A well-drafted Employment Contract can support your policy by clearly setting behavioural expectations, safety obligations, and disciplinary pathways.
This doesn’t replace a fair process, but it helps demonstrate that the employee knew the rules and that your response aligns with documented expectations.
Train managers on “what to say” and “what not to say”
Many disputes start with a manager reacting emotionally in the moment.
Teach your leaders to:
- focus on observable behaviour and safety
- avoid personal accusations or moral judgement
- avoid medical assumptions
- escalate quickly and document accurately
Plan for the human element
Sometimes a drunk at work incident is a one-off lapse. Sometimes it indicates a bigger issue. Where appropriate (and safe), consider whether support, leave, or adjustments are viable.
Taking a measured approach can protect your culture and reduce turnover - while still meeting your WHS obligations.
Key Takeaways
- If an employee is drunk at work, your first priority should be safety - remove them from risk, arrange safe transport, and avoid “on-the-spot” disciplinary interrogation.
- Document factual observations and actions taken, because clear records can be critical if you later face an unfair dismissal dispute.
- Follow a fair process: check contracts and policies, investigate, invite the employee to respond, and make a decision that matches the evidence and the risk.
- Dismissal may be justified in serious cases (especially where safety is involved), but inconsistent enforcement or poor process can increase legal risk.
- Strong workplace documents (policies, contracts, and clear processes) make it easier to prevent incidents and manage them properly when they happen.
If you’d like help responding to a drunk at work incident or reviewing your workplace documents and termination process, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
