(1) An employee who breaks faith with the trust given them by the public, the state and the department by violating these rules or the code of ethics shall be subject to appropriate disciplinary action. The disciplinary action may include, but is not limited to, written warning, suspension without pay, demotion or immediate termination of employment depending on the severity of the violation. In the case of a contractor, the disciplinary action may include immediate termination of the contract and other action as allowed by law and the terms of the contract.