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CEO could be summarily dismissed

January 2010 - Employment. Legal Developments by Norrbom Vinding Law Firm, member of ius laboris.

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It is all right to summarily dismiss a CEO if he has made the company pay his private expenses

Making the employer pay for private expenses without prior approval will generally constitute gross misconduct.

The case concerned a CEO who had been summarily dismissed for using company funds to finance a private building project. The CEO believed that the summary dismissal was unfair because the project had been carried out in the company's interest for marketing purposes. He therefore issued proceedings.

In the judgment, the Danish Eastern High Court noted among other things that the CEO had held a position of trust and that he had signed the company code of conduct. Both factors meant that the CEO should have known that the expenses were not payable by the company. Also, providing partial funding for employees' building projects was not standard practice in the company. On those grounds, the summary dismissal was justified.