$23,000 compensation for unjustified dismissal…

The Employment Relations Authority has upheld a personal grievance claim for an unjustified dismissal.  The employee was sacked for repeated errors at work. However, the ERA held that there was no proper investigation, as the employer treated the allegations as fact rather than investigating if they actually occurred.

The ERA awarded $18,000 compensation for the unjustified dismissal.  This was reduced from $20,000 because of the employee’s behaviour for swearing at a manager during the process.  She was also awarded two month’s lost wages (figure to be confirmed).

The employee was also awarded $5,000 for receiving an unjustified final warning on a previous occasion, because no proper performance process had been carried out which would have justified any final warning.

It is important to follow a proper process when investigating performance and disciplinary issues, because a failure to follow the processes required will result in an almost automatic unjustified disadvantage or unjustified dismissal and expose the employer to substantial damages and penalties.

Alan Knowsley

Employment Lawyer Wellington

Constructive dismissal rejected but unjustified disadvantage upheld…

The Employment Relations Authority has rejected a claim for constructive dismissal after an employee resigned during an investigation into their conduct. 

The employee had previously been given a verbal warning about their conduct in the workplace and had then been given a written warning following further events.  A third process then commenced in relation to later events.  The employee decided to resign after she received a file note in relation to the earlier incident around the verbal warning.  This was because she discovered that the file note had been made only the day before she received it and not a year before as was purported to be the date of the file note.

The employee claimed constructive dismissal because of the deceptive conduct around the file note and in relation to the verbal warning and written warning given.

The ERA held that the verbal warning was defective in that the warning had been given at the same meeting as the concerns had been raised with the employee.  There had been no opportunity to take advice and to provide a response to the allegations, so the warning was defective. 

In relation to the written warning the employer had decided to withdraw the written warning and had advised the employee of this before she resigned.  The employee resigned with full knowledge that the written warning was to be withdrawn and so suffered no disadvantage from the written warning. 

In relation to the alleged deceptive conduct around the file note, the file note was typed up the day before the note was provided to the employee. However, it was based on contemporaneous hand written notes from the time of the incident.  Typing up the note was not intended to deceive and any concern the employee had over the dating of the note should have been raised with the employer for clarification. The timing of the note did not justify the employee resigning without raising matters with the employer.

The claim for unjustified constructive dismissal was rejected, as was the claim in relation to the file note and the written warning.  The verbal warning, having been defective, was an unjustified disadvantage and the employee was awarded $6,000 compensation plus costs.

Alan Knowsley

Employment Lawyer Wellington

Immigration scam does not constitute employment…

The Employment Relations Authority has rejected a claim for unjustified disadvantage because the alleged employee was not actually an employee.

The “employee” claimed that he was an employee and that they did not pay him or provide employment to him despite a signed employment agreement.

The ERA determined that the employment agreement was an immigration scam.  The “employee” paid the employer to allow him to pay it money, which it then paid back to him and paid tax to the IRD.  There was no actual employment and the “employee” never carried out any work for the “employer”.

The “employer” was therefore successful in defending the claim by the “employee” and was not liable for any damages or compensation to the “employee”.  However the Employment Relations Authority referred a copy of its decision to the Deputy Chief Executive of Immigration New Zealand and the likely outcome of that will be a prosecution being brought against the “employee” and “employer”.

Alan Knowsley

Employment Lawyer Wellington

Employer ordered to pay over $40,000 to employees that had worked less than two weeks …

Two employees that were dismissed after their employer relied on an ineffective 90-day trial period have been awarded over $20,000 each.

The employees began work with the employer, however, they did not sign their employment agreements until several days after they had begun work. In addition, one of the employees had previously worked for the employer a number of years earlier.

A trial period, which can be for a period of no longer than 90-days, can only be used for new employees. An employee is not new if they have previously worked for the employer and this includes if the employee has started work without having signed an employment agreement before starting.

The employees were awarded approximately $10,500 each for lost wages, $12,000 and $8,000 respectively for compensation, as well as the possibility of claiming costs.

It is important for employers to ensure that new employees sign an employment agreement (containing an effective trial period) prior to undertaking or performing any work for the employer. Otherwise there is the risk that the employee can raise a personal grievance if the employer then relies on an ineffective trial period.

If an employee is not a new, the employer may still include a probationary period in the employment agreement. However, it is important to note that there are differences between a trial period and probationary period.

The ERA orders employer to pay $3,000 over comments made on social media…

The Employment Relations Authority has ordered an employer to pay $3,000, after it breached a Record of Settlement, which included a clause that the employer and employee would not make disparaging comments about one another after the Record of Settlement was signed.

The employer posted harmful comments about the former employee on Facebook. This caused the employee to raise it with his new employer and subsequently led to the employee leaving his new employment.

The ERA ordered the employer to pay a fine of $3000. The ERA said it was to serve as a deterrent to others.

This is a timely reminder that a Record of Settlement is a legally binding agreement and once it is signed, the terms must be adhered to. If a party does not comply with the terms, penalties can be imposed by the ERA such as in the case above.

Ben Ruback

Employment Lawyer

Changes to Employment Law 6 May 2019

The law on employment changes on 6 May 2019 when several new laws come into effect. These include:

Trial periods

90-day trial periods will be restricted to businesses with 19 or fewer employees.

Employers who have 20 or more employees will have to assess an employee’s skills against the role’s responsibilities in the same way as for any other employees.  Fair process requirements will apply to all performance assessments.

Continuity of employment if restructuring

Employees who work in vulnerable industries such as cleaning and catering services will be able to transfer to new employers, regardless of the size of their prospective employer.

Employees will also have more time to decide if they want to transfer to the new employer.

In addition, there is now scope for the Government to accept new categories of employees into the ‘vulnerable workers’ definition. 

Rest and meal breaks

From 6 May 2019 employees will be entitled to two paid minimum rest breaks of 10 minutes, and an unpaid minimum meal break of 30 minutes, throughout their 8-hour work day.

Employers and employees may agree when these breaks will be taken, but if they cannot, then the law will apply. Shifts of longer or shorter than 8 hours have a correspondingly increased or reduced number of breaks of a similar nature.   

Some limited exemptions may apply for some workers in specified essential services or national security services.

Paid time out of work for union delegates

Union delegates will be allowed paid time off work to carry out their union activities.  Employees must notify their employers in advance and obtain their agreement if possible. Employers may refuse only if the time off work will result in unreasonable disruption to the business or the employee’s duties.

Duty of good faith applies to collective bargaining

Parties must endeavour to reach an agreement during collective bargaining, unless there are genuine reasons, based on reasonable grounds, not to.

Pay rates must be included in collective agreements

Collective agreements must show how wages or salary may increase over the term of the agreement.

Obligations to new and prospective employees who are not union members

Employers must provide new employees with a prescribed form within the first ten days of employment.  Unless the employee objects, the form must be returned to the relevant union.

The form gives employees time to talk to their union representatives before deciding whether they want to join the union or remain on an individual employment agreement.

Employers must forward information about the union to prospective employees, but the union must cover the costs of providing printed materials.

Jaenine Badenhorst

Employment Lawyer

Unjustified dismissal following taking annual leave…

The Employment Relations Authority has upheld a claim for unjustified dismissal after an employee claimed that she was dismissed for taking annual leave which had been agreed.

The employee had two periods of leave approved in advance by her employer, one week before Christmas and one week in February.  A couple of days before the Christmas leave was due to commence the employer asked her not to take the leave due to the workplace being very busy.  She agreed to cancel that leave, but on the basis that she could continue to take the leave in February and would be able to take extra leave at Easter.

However, when the February leave came around the employer again asked her not to take the leave due to the workplace being busy.  She refused and said that she had already made bookings for leave and took the leave.  The employer then responded by saying that she will not be able to take leave at Easter.  After a dispute about the ability of the employer to cancel pre-approved leave the employer then gave her notice of termination.  The ERA held that the termination was unjustified as she had no opportunity to respond to the alleged poor performance which was given as the reason for her dismissal.  Instead the ERA found that this was a direct result of the employee taking pre-approved leave and that such action was unlawful.

The employee was awarded $12,500 compensation for hurt and humiliation suffered. 

Alan Knowsley

Employment Lawyer Wellington

Senior lawyer loses employment claim…

The Employment Relations Authority has rejected a claim for unjustified disadvantage from a Senior Consultant at a South Island law firm.  The Consultant had previously been a Senior Partner in the firm and after retiring was re-engaged as a Consultant by the firm.

Some of the other Partners became concerned about his behaviour in inviting young female staff out to lunch and for drinks and for inappropriate touching of staff.  They had a meeting with him and brought up these matters in expectation that he would amend his behaviour appropriately.

However, shortly after the meeting he again sought to invite a young female staff member out for dinner and she raised the matter with the HR Department, because of the uncomfortable feelings she had as a result of these approaches.

The firm carried out a formal disciplinary process and issued a final warning to the Consultant for his behaviour.

The Consultant attempted to say that the process was unfair and disadvantaged him, but the Employment Relations Authority found that the process followed by the law firm was completely standard.  It had fairly brought the allegations to his notice and given him an opportunity to respond to them.  It then considered all the evidence before reaching a decision and issuing the final warning.  The Consultant’s claim was therefore dismissed.

Alan Knowsley

Employment Lawyer Wellington

Failure to maintain records costs employer…

The Employment Relations Authority has ordered an employer to pay seven staff over $41,000 for short paid wages and unpaid holiday pay.  The employees claimed that they worked up to 50 hours per week but were only paid for 30-45 hours each.  The employer’s records were deficient and the Inspector believed that they were created after the records were requested by the Labour Inspector.  They failed to correctly record the hours worked and wages paid and also failed to account for holiday pay.

In addition to being ordered to pay the $41,000 in back pay, the case will proceed to a further hearing to decide penalties against the employer for failing to make the correct payments and failing to keep proper records.

Alan Knowsley

Employment Lawyer

Wellington