An Overview of Dismissal of Managerial Employees for Breach of Fiduciary Duties

Abstract

Directors and other senior managers stand in fiduciary relationships to the company they work for and have the responsbility and duty to ensure that they do everything possible to act in good faith toward the company and make sure that they do not compromise their positions which might result in conflict of interest. However, should they breach thier fiduciary duties in whatever way, this will amount to breach of trust which may lead to criminal prosecution and dismissal from the company. With regard to their civil responsibilities, they will be made to restore or return the proceeds from the breach of trust. This paper examines the nature and scope of the implied terms of trust and confidence of managerial employees in the workplace. The paper highlights the importance of fiduciary relationships with regard to implied terms of loyalty, good faith and discharge of duty in the best interest of the company by responsible senior managers and directors. The paper analyses consequences of breach of fiduciary duty, obligation and trust by emphasising that the erring employee would be put through disciplinary processes which might lead to termination of employment or outright dismissal.

DOI: 10.5901/mjss.2013.v4n13p809