Family business dispute costs employer over $59,000…

The managing director of a family business took an unjustified dismissal claim against her employer (owned by various family members) after her dismissal on a range of serious misconduct matters.  These included consumption of alcohol at work, falsifying timesheets, banking funds into her own account, taking cash home, theft, and giving discounts to her domestic partner.

The employee was suspended and then dismissed following a meeting with the other directors and shareholders, and took a personal grievance for unjustified dismissal and unlawful suspension.

The Employment Relations Authority found that the suspension was done without a proper process as the employee had no opportunity to comment on the suspension before it was imposed.

The ERA also found that there was no evidence to support any of the allegations as misconduct, let alone serious misconduct justifying dismissal.

In addition the employer carried out the disciplinary process by stealth.  It did not advise the employee of the real purpose of the meeting, nor what the allegations were in advance (so she could not prepare).  It did not give her an opportunity to have a support person, and did not give her any of the documentation upon which it relied.

The employer also told the other employees (before it had reached a decision on the allegations) that the employee “had done very bad things” and would not be returning.

The ERA held this to be gross predetermination of the issues and a complete failure of any proper process, describing the employer’s actions as “cavalier”.

The ERA order compensation of $15,000, lost wages of $31,833, wage arrears of $6,500 and costs of $5,890 (totalling more than $59,000).

The employee may not see any of this money as the business is no longer trading and is said by her other family members to be insolvent.

If you need help getting your disciplinary investigations right give me a call on 04 473 6850.

 

Alan Knowsley