Imagine that you had two employees, and one of them slept with the other's wife.

What would you do in that situation? The guy's actions, and the disruption to team dynamics aren't nothing. But you have to be able to understand them in the context of you not being the aggrieved party.

Before this happened to you, could you see yourself getting rid of the guy who had been aggrieved if the other guy was the better worker - "to help team dynamics"?

If you a) are sure you wouldn't do that, and b) the team dynamics have been disrupted, then you should talk to an employment lawyer about the next steps.

But if you would act differently if it wasn't you, then you have a different answer.