Last month two former ANZ financial traders brought separate but related actions against the bank following the termination of their employment. The Australian Financial Review has  reported that one of the claims is for approximately $30 million in damages for loss of deferred shares and future income.

The reasons for the terminations were cited as “serious breaches” of ANZ’s code of conduct including inappropriate comments over the bank’s internal messaging system. The employees allege that behaviour such as drug use, excessive alcohol consumption and trips to the strip club during work were known about, and in some cases encouraged, by senior members of the bank.

While the actions have not been heard by a court yet and may not ultimately be established, on a general level, the allegations highlight the importance of leaders of organisations doing exactly that, leading. Employers should be aware of the potential difficulties in enforcing a code of conduct if executives and team leaders are not held to the same standard as those that they supervise.

While codes of conduct may be a good reference point, workplace conduct does not occur in a vacuum and festering “grey areas” can cause serious issues when a party comes to the conclusion that the employment relationship should come to an end.

While employers will inevitably need to draw a line in the sand and cannot continue to allow inappropriate behaviour to go on, they should be cautious of acting on the conduct without consideration of applicable workplace laws.

At the same time, employees who feel as though they are part of a “poor culture” must consider their position within the organisation and the impact of their own behaviour on the organisation as a whole.

The conduct alleged in these types of actions, if established, can negatively impact a business’ brand long after deeds are signed or orders are made. Although it is of course better to address these issues before they become ingrained in a culture, there is no better time than today to reflect on how your organisation’s code of conduct matches up with the conduct of its employees (especially those in leadership positions).