[Vicky.]

What kind of a contract does he have?

I used to work for a taxi company (one of the radio people) and our drivers either
1) Essentially rented a car from us. They gave a set amount each week and all job money went to them.
2) Went halfies with the owner on each job.
3) Were paid a set wage no matter how many jobs.

The cutting leather from your car, would surely come under gross misconduct? Though if that was a while ago you might find it hard to get rid of him for that. I wouldn't use texts to talk to your staff either, especially if you are giving them warnings and stuff. Best to keep to written down on paper, with a copy for your records.