Employment case notes (ET 110)

McGuire v Rubber Flooring—Employment Court, Auckland, March 2006

An employee’s challenge to an Employment Relations Authority determination about the termination of her job was partially upheld by the Employment Court.

In late 2003, after eight years of working for the flooring company, the employee was suddenly made redundant shortly after the owner had died and his son had taken over the business.

The employee claimed that prior to the redundancy she had been unfairly demoted from her managerial role. She also claimed she was then unjustifiably dismissed. The company disputed this and claimed her dismissal was a redundancy due to genuine commercial reasons. It also claimed the employee had never held a managerial position.

The authority ruled in favour of the company and found the employee’s dismissal was justified because it was the result of redundancy. It also found the process had been carried out in good faith, and that some disputed money had been a loan.

However, Judge Travis found the employee had held a managerial position in the company and that she had effectively been demoted to a sales person’s role. This meant she had been unjustifiably disadvantaged, which impacted on the way she was treated in the restructuring.

While the judge found the restructuring was carried out for a substantive commercial reason and was therefore a genuine redundancy, he also found the redundancy process was carried out unreasonably, unfairly, and not in good faith. Further, he found the disputed money was an advance on a promised salary increase, not a loan.

The employee’s claim for reimbursement of, and/or compensation for, lost remuneration was dismissed. But she was awarded $7500 for distress and injury to feelings.

Busch v Prime Television NZ—ERA, Auckland, February 2006

A salesperson’s claims of unfair dismissal, along with unwarranted criticism of her performance, were upheld by the Employment Relations Authority.

The employee had worked for Prime Television selling ads in the Waikato region, since 1998. In that time there had been no issues with her performance. But in 2002 a new manager started and, in 2003, the employee received a warning about her attitude and behaviour, although her performance was still considered satisfactory.

This warning was followed in early 2004 by one, described as final, which identified concerns about the employee’s performance and attitude. After this warning the employee and her manager met weekly to review sales and prospects. In October, her manager decided she had not seen enough improvement and dismissed her.

While the company claimed the dismissal was procedurally fair, the employee disagreed because the warnings were not about the same issue and had a lengthy time gap between them. She also claimed her targets were unreasonable, that her performance showed significant improvement at the time of her dismissal, and that there was disparity between her treatment and that of others.

Although the authority found the time gap between warnings was reasonable, it found the warnings were not on the same issue and so the final warning was not, in fact, a final warning. The authority also found the employee’s targets were not reasonable, and her performance had shown improvement prior to her dismissal. Further, it determined the employee’s treatment was not consistent with that shown towards her colleagues.

For those reasons, the employee’s dismissal was found to be procedurally and substantively unjustified. She was awarded $5000 for hurt and humiliation.

Hunt v Mercury Consulting Group—ERA, Wellington, February 2006

An employee’s claims that her employer failed to comply with the HSE Act, which led to her resignation, were dismissed by the Employment Relations Authority.

The employee had been at the company for several months when a person was employed to support her role due to her increased workload and issues relating to two short absences of management. The employee’s workload was later reduced, but she began to exhibit difficulties maintaining her work, and to suffer health problems.

In early 2005, the employee had several meetings with her employers about her workload and also about her health issues, including stress. Both parties disagreed over exactly what was said at each meeting and whether anything had been achieved. Furthermore, the employee claimed the future of her job was left uncertain; her employers disputed this.

The company then suggested the employee see a psychologist—at the company’s expense. After her consultation, the employee did not return to work and her employers were told she had clinical depression caused by workplace stress. Both parties then disagreed over the psychological assessment and the existence of a medical certificate. The employee also made a personal grievance claim and complained of sexual harassment and bullying.

The authority found the company had not breached the employment agreement, and it made the appropriate moves to support the employee. It also found there was no evidence the employee’s job was inherently stressful, that her medical evidence provided was one-sided, and that she had not established a definite link between her illness and her work. Her complaints of bullying and sexual harassment were dismissed due to a lack of evidence.

In conclusion, the authority dismissed the employee’s claims and reserved costs.

Morrison v Spotless Services—ERA, Wellington, February 2006

The Employment Relations Authority found in favour of an employee who had an employment relationship problem with her employer resulting from the termination of her job.

While the company claimed the employee abandoned her employment after taking large quantities of both paid and unpaid leave, the employee claimed she was unjustifiably dismissed when she took a further period of (unpaid) leave due to a medical problem which required surgery and a number of weeks of recuperation.

The authority found the company had been faced not with abandonment but with an employee who made a decision to take time off work when leave had not been approved. Although she was on notice, at the time, that her employment would be terminated if she failed to discuss the matter with her employer, her actions were grounds for a disciplinary matter rather than an abandonment claim.

Further, the authority determined that, given the information available, it was clear the employee was suffering from a significant medical problem, but wished to return to her job. A fair and reasonable employer would not have dismissed in the circumstances, especially when the position could be filled temporarily.

Therefore, the employee was unjustifiably dismissed in an opportunistic situation (for the employer). This meant the employee was awarded $5123 for lost wages and $7000 compensation for loss of dignity and injury to her feelings, even though her past absences had contributed to her situation.

—Selected and written
by Miriam Bell

Previous Employment Case Notes

Issue 160
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