$23,000 penalties for wage deductions…

The Employment Relations Authority has fined an employer and the director of the employer for unlawful deductions from employees’ wages.

The employees of a service station had wages deducted whenever a customer drove off without paying.  The ERA held that such deductions are unlawful and both the employer and the director of the employer were penalised for the breaches.  The fine for the employer was $20,000 and for the director $3,000.

The company claims to have removed the deduction clauses from its employment contracts and to have repaid the workers who had deductions made.

Employers should be very cautious when making deductions from employee’s wages for the actions of employees and this can only be done with the agreement of the employee.  That agreement has to happen on each occasion of a deduction. A general provision for deductions in an employment agreement cannot suffice.

Alan Knowsley

Employment Lawyer Wellington

Unjustified dismissal under 90 day trial provision…

The Employment Relations Authority has upheld a personal grievance claim for unjustified dismissal after an employee was dismissed under a 90 day trial period clause.

The ERA held that although there was a 90 day trial clause in the employment agreement, that employment agreement was never signed by the employee.  This means the employer cannot rely on the 90 day trial clause and must satisfy the ERA that the process followed for termination was fair and reasonable in the circumstances.

The ERA held that the employer failed to show that the process followed was correct because it did not properly raise performance concerns with the employee.  It did not give the employee any time to prepare a response.  It did not make the consequences of failing to reach the required standards clear.  It did not provide the employee with any assistance to improve his performance and there was no review of the performance made by the employer.  In actual terms the employer gave the employee no opportunity to comment on the concerns before the dismissal was made.

The employee managed to find work quite quickly so it was awarded $1,800 lost wages but was also awarded $10,000 compensation for the unjustified dismissal.

To rely on a 90 day trial period clause, both the employer and the employee must sign the agreement before the employee commences work.  If that has not been done, the employee has already been employed by the employer prior to the clause being signed and such a clause is invalid.

Alan Knowsley

Employment Lawyer Wellington

Dismissal for social media post justified…

The Employment Relations Authority has rejected a personal grievance claim for an unjustified dismissal from an employee who posted an aggressive and offensive post on Facebook.

The ERA found that the employer carried out a fair and reasonable investigation into the allegations before reaching a conclusion that it would dismiss the employee.  The ERA found that:

1. the employer investigated the allegations sufficiently;
2. the employer fairly outlined the allegations and explained the implications if serious misconduct was found;
3. the employer gave the employee a reasonable opportunity to respond to the allegations before it made its decision on the allegations;
4. the employer properly considered the explanations given by the employee;
5. the employer gave the employee a reasonable opportunity to respond to its decision to dismiss before it imposed that section; and
6. the employer considered the responses from the employee before it finalised its dismissal decision.
   The employee at the disciplinary meeting admitted making the social media post and admitted that it breached the organisation’s policies.  This meant that the employer was right to conclude that the aggressive and offensive language used in the Facebook post was in breach of its policies on social media use and went against the values of organisation.

The employer was justified in reaching a decision to dismiss the employee because this was serious misconduct and the employee was on a final warning for prior threatening and intimidating behaviour.  Even if the employee had not been on a final warning, the behaviour in this case would have justified dismissal as serious misconduct on its own, even though the employee had worked there for 27 years.

Employer penalised for breach of mediated settlement agreement…

The Employment Relations Authority has fined an employer $2,000 for failing to adhere to the terms of a mediated settlement agreement.

During the course of employment an issue had arisen between an employee and the employer.  To resolve that they attended mediation and agreed on a settlement whereby the employer was to pay the employee $12,500 by weekly instalments of $500.

The employer paid some of the weekly instalments but failed to pay $7,000 of the agreed sum.

The ERA ordered the employer was to pay the balance immediately and also imposed the $2,000 penalty for the deliberate breach of the mediated agreement.

If you agree to terms at a mediation and those terms are recorded in the mediation agreement then you must adhere to them.  Failure to do so can result in a penalty from the Employment Relations Authority.

Alan Knowsley

Employment Lawyer Wellington

Constructive dismissal following suspension without pay…

The Employment Relations Authority has upheld a claim for personal grievance for a constructive dismissal.  The employer suspected that the employee had stolen company property and suspended the employee pending an investigation into those allegations. 

The employee, however, was suspended without the opportunity to comment on the suspension and without pay.  Both of those failings, along with a failing to keep the employee advised of progress of the theft investigation, meant that it was reasonable for the employee to refuse to work under those circumstances and he was entitled to resign and bring a claim for constructive dismissal.

The employee was awarded $3,800 lost wages for the period while he was suspended without pay and also for the period he was out of work after he resigned.  The employee was also awarded $10,000 compensation and $2,000 holiday pay.

However, after the employee commenced his claim in the Employments Relation Authority the defendant company was placed into liquidation, so it is probably unlikely that the employee will receive any of the compensation awarded.

Alan Knowsley

Employment Lawyer Wellington

Unlawful charge for employment…

The Employment Court has held that a payment to the employer as part of an employment package was an unlawful premium in breach of the Wages Protection Act.

The claimant was an accountant who signed up to work for an accountancy group.  As part of the deal she paid $125,000 for the right to be a regional partner and work for the group.  She did not become a partner in the sense of an owner in the group, but was an employee.

The Court held that without paying the $125,000 entrance fee she had no right to work for the group and therefore the payment was a premium for employment and unlawful.  The accountancy group was ordered to repay the $125,000 immediately and also ordered to pay an $8,000 penalty to the plaintiff.

This situation of an employee paying for the right to work was contrasted by the Court with a situation where an employee pays to undertake some training to acquire qualifications before being employed.  In that case the qualification was of value to the employee and could be used by them to obtain employment at any other employer in the industry.

It is very important not to charge employees for offering employment and if an employer is contemplating making a charge for some reason, then it would be important to get advice from an experienced professional before doing so.

Alan Knowsley

Employment Lawyer Wellington

Personal grievance out of time allowed by Court…

The Employment Court has found that exceptional circumstances existed to allow an employee to bring a personal grievance outside the 90 day time limit.

The employee had been dismissed from his employment and had engaged lawyers to assist him with the claim.  Despite making contact with the lawyers on multiple occasions they failed to raise a personal grievance within the 90 day time limit.

The employee therefore took it upon himself to raise the grievance, but instead of sending that the employer he sent it to the Employment Relations Authority.  He sent it on the evening of the last day of the 90 day time limit, but it did not arrive by way of email until the following morning at 1 a.m.   This meant that it was out of time by the time it arrived at the Employment Relations Authority.   The ERA staff then sent it on to the employer the following day but that made it two days outside the 90 day time limit.

The Court considered all matters including that the employee was under significant stress as a result of the events giving rise to his dismissal and as a result of that significant stress he was not able to properly appreciate or undertake the processes needed to file his personal grievance within time.

The Court therefore allowed him to file out of time because of the short two delay in getting the matter to the employer which did not cause them any prejudice.

The Court emphasised that an extension will only be given in exceptional circumstances and that here both the mental state of the employee and the fact that he had been abandoned by his lawyers without assistance were exceptional factors justifying an extension of time.

Alan Knowsley

Employment Lawyer Wellington

Poor process results in unjustified dismissal…

The Employment Relations Authority has upheld a personal grievance claim for unjustified dismissal after an employee was dismissed during an investigation meeting.

The employer alleged that the employee had self-harmed in the workplace because he did not want to carry out tasks assigned. 

The employer called the employee to a disciplinary meeting, but only gave 24 hours’ notice of that meeting.  During the meeting the employer did give the employee an opportunity to give explanations, but immediately dismissed him during the meeting.  The Employment Relations Authority held that there was obviously no consideration of the employee’s responses before the employer moved to immediate dismissal.

In addition the employer had failed to provide the employee with any information to support the allegations, for example, statements from witnesses to the incident. 

Those failings meant that the dismissal was unjustified and the employee was awarded $11,700 lost wages and $15,000 compensation for hurt and humiliation.

Alan Knowsley

Employment Lawyer Wellington

Dismissal by text after threats of violence by employer…

The Employment Relations Authority has upheld a personal grievance claimed for unjustified dismissal after an employee was fired by text message.

There was an altercation at work following demands by the employee to be paid his unpaid wages and the employee was physically assaulted by the employer and the employer also made threats to harm the employee and the employee’s family. 

Unsurprisingly, the employee left the workplace and went to the Police to make a complaint.  He was then also taken to the hospital as a result of the severe upset he suffered because of the threats.

The employer then sent a text to the employee dismissing him on two weeks’ notice. 

The ERA had no difficulty finding that no proper process was followed and that the dismissal was unjustified.  The employer sought to avoid liability by claiming that the text had come from her husband and that he had no authority to fire the employee.  The ERA held that the husband was in daily contact with employees and managed the workplace on a daily basis.  He was therefore held out as having authority to make decisions such as hiring and firing staff.

The employee was awarded $1,760 unpaid wages plus $20,000 compensation for the hurt and humiliation suffered by way of the unjustified dismissal.  The award was higher than normal because of the total lack of process and the physical assault and threats of harm to both the employee and his family.

Alan Knowsley

Employment Lawyer Wellington

Boarding house parents “working” during sleepovers…

The Employment Relations Authority has found employees engaged to be “house parents” at a boarding school and on call overnight, were working during those sleepovers.  They were entitled to be paid for the hours they had “worked” when on call at nights.

This was because they were required to sleep in the boarding house and not their usual accommodation, could not entertain guests or go out and could not drink alcohol during the time they were rostered on.  This was true whether or not there was actually any disruption to their evening while they were rostered on.

The employees however, could only claim back six years of unpaid wages from the time they filed their claims as anything before that was barred.

In addition the school had changed its process and had it hired security guards to be responsible after 10.30 pm to respond to any issues in the boarding houses.  After that time any staff responding were volunteers and were therefore not entitled to be paid.

That left a period of about 5 years which the school would have to pay the staff for those nights rostered on which will be a significant unexpected cost to pay in a lump sum.

Alan Knowsley

Employment Lawyer Wellington

False excuses lead to dismissal…

The Employment Court has upheld as justified a dismissal of an employee who failed to return to work on the day they were due back after annual leave.

The employee was due to return to work on a Monday, but on that day called in to say that their flight had been cancelled and there was no alternative flight until the next day.  They were asked to provide copies of the tickets for their flight, but failed to provide those to the employer.  The employee also changed their story to say that they had missed the flight rather than it being cancelled.

The employer carried out an investigation, at which the employee again failed to provide any evidence of a booking for the flight they said was cancelled or missed.  The employee was dismissed for being absent without approved leave and for misleading the employer as to the reasons.

The Court held that missing work on the Monday would have been misconduct, but on its own would not justify dismissal.  The Court went on to find however that misleading the employer as to the reasons for not being at work, by claiming the flight was cancelled and that it had been missed, when these reasons were not correct, destroyed the trust and confidence of the employer in the employee and amounted to serious misconduct justifying dismissal.

If the employee had just failed to turn up for work on a Monday without giving any reason, then that would have been misconduct, but would not have resulted in their dismissal.  Giving false reasons turned misconduct into serious misconduct and the employee’s claim was dismissed.  The employee now faces costs awards against her in both the Employment Relations Authority and the Employment Court as well as being out of employment.

Alan Knowsley

Employment Lawyer Wellington