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It was fair to sack a director who failed to disclose a s-xual relationship with a subordinate and was "essentially dishonest" when questioned about it, the Fair Work Commission has ruled.

Commissioner Tanya Cirkovic noted that "not all romantic relationships formed in the workplace will warrant disclosure", and in some circumstances it was "not suitable for an employer to govern the activities of an employee's out of hours conduct".

But in this case, she found the director's decision not to inform his employer of the relationship deprived it of the opportunity to appropriately manage any potential conflict of interest and "destroyed" its trust and confidence in him.

Mt Alexander Timber & Hardware sacked the director and general manager in April this year for failing to disclose that he was in a sexually intimate relationship with a contractor, who was also a co-director's estranged wife, and for then denying the relationship "on multiple occasions"...