Compensation Awards 07

  Compensation for Humiliation etc Table

(s123(1)(c)(i) ERA)
Employment Court and Employment Relations Authority

1 January 2007 – 31 December 2007

While every effort is made to ensure the accuracy of the information provided in this table, the Court, Authority and Information Centre accept no liability for any consequences that may arise from reliance on this data. The awards shown above take into account any reduction for contributory conduct. Also note that Employment Relations Authority awards that have been set aside or altered by the Court are included in the table. Where there were two successful applicants awarded separate amounts, those amounts are recorded separately.

Crown copyright 1997. All rights reserved. No part may be reproduced or copied in any form or by any means without the prior written permission of the copyright owner except in accordance with the provisions of the Copyright Act 1994. Infringement of copyright may result in criminal charges, a fine of up to $50,000 and imprisonment for a period not exceeding 3 months. All requests for reproduction or copying of this table should be addressed to: The Legal Section, Workplace Knowledge Management Team, Department of Labour, PO Box 3705, Wellington.

Awards over $15,000

Housham v Juken New Zealand Ltd [2007] ERNZ 183

The plaintiff was employed as a lathe runner by the defendant.  He was dismissed for serious misconduct after a physical altercation with another employee at his workplace.  The defendant rejected the plaintiff’s claim he acted in self defence, and relied on its Code of Conduct, which prohibited fighting even if the employee was provoked.

The Employment Relations Authority concluded a fair and reasonable employer would have dismissed the plaintiff in all of the relevant circumstances.  The plaintiff’s claim was dismissed and he received no remedies. The plaintiff challenged this determination to the Employment Court. 

The Court found that, while a “zero tolerance” policy towards workplace violence was admirable, employees were entitled to take reasonable steps to avoid actual or imminent assault, and this could include what may amount to a technical assault.  It was not reasonable for an employer to summarily dismiss all employees in any way involved in any physical altercation.  Although the defendant’s investigation was fair in many ways, in other important ones it failed to meet the applicable standards of procedural fairness.  The defendant’s reconstruction of the altercation was not unreasonable in itself, but it was unfair for it to take information from it into account without putting it to the plaintiff for comment.  It also failed to put the allegation that the plaintiff was a suspect to him in a timely manner.  It followed that the dismissal was unjustified.

The plaintiff had a strong connection to the defendant and was one of its longest serving employees.  He was also a senior union delegate and the loss of his job meant he was no longer able to represent his colleagues.  The plaintiff was a well respected and involved member of his community and his dismissal for fighting became a topic of conversation.  It was very embarrassing for the him to have to keep explaining what happened, and even his daughter was convinced the defendant must have been right to dismiss him.  Witnesses gave evidence of the effect of the dismissal on the plaintiff and estimated it took six months before he returned to his normal self.  The consequences of his unjustified summary dismissal and circumstances of it warranted a substantial, but not excessive, award.  The Court ordered compensation of $20,000 and reimbursement of wages lost since the dismissal.  The Court did not consider the plaintiff’s behaviour contributed to his dismissal, indeed it appeared to exemplify what he should have done in the circumstances. 

Corps v AFFCO New Zealand Ltd unreported, P R Stapp, 19 July 2007, WA 100/07

The applicant was employed as an Inventory Controller by the respondent.  The respondent became concerned about the applicant’s use of its newly introduced inventory system and suspended him while it investigated further.  The applicant admitted deleting stock as he was having problems with the new system.  The respondent considered this impeded its ongoing theft investigation and corrupted the inventory.  It dismissed the applicant for serious misconduct for failing to follow company policy or act with reasonable care.

The Authority considered the applicant’s suspension was unfair as he had no input into the decision and was not put on notice.  The respondent was also unable to justify its decision to dismiss for serious misconduct as the applicant provided an explanation that underlying performance issues existed in relation to his operation of the inventory system and the respondent acknowledged problems with the system.  A fair and reasonable employer would not have dismissed the applicant in the circumstances, it was a performance matter and should have been dealt with accordingly.  Also, the procedure followed by the respondent was unfair and breached its HR manual, undermining its attempt to justify its actions.   

The applicant claimed he was dismissed so the respondent could avoid paying him redundancy compensation.  However, uncertainty meant the Authority could not compensate him for the loss of this potential benefit.  After his dismissal, the applicant became reclusive and avoided participating in his various club activities.  He also needed medical help.  The applicant gave evidence he did not trust employers to work for one again, and had since become self employed.  The applicant satisfied the Authority there was a significant impact on him because of his wholly unjustified dismissal and compensation of $18,000 was warranted along with six months lost wages. 

Mitchinson v The Chief Executive of the Department of Corrections unreported, H Doyle, 9 November 2007, CA 132/07

The applicant was employed by the respondent as an instructor in the Corrections Inmate Employment Unit at Invercargill prison.  During the course of a warm up for a training session the applicant injured his knee.  The applicant went to his doctor who filed an ACC claim for a work-related injury.  The applicant did not complete an accident report for the injury.  The applicant was advised there was to be an investigation into an allegation of serious misconduct that he had falsely declared a work-related injury.  The applicant was on special leave and then suspended for the duration of the investigation and disciplinary process.  The applicant was dismissed for serious misconduct and did not return to work before his dismissal.

The Authority found that the applicant was unjustifiably dismissed.  The applicant had failed to complete an accident report about his injury but a fair and reasonable employer would not have considered that to be serious misconduct.  The investigation process undertaken by the respondent was significantly flawed and unfair.  Matters in the applicant’s favour were not considered or investigated properly and were simply dismissed or ignored.  In all the circumstances a fair and reasonable employer would not have decided to dismiss the applicant.

As a result of his dismissal the applicant became very depressed and his feelings ranged from anger to humiliation and bewilderment.  The applicant’s evidence was supported by his wife and his doctor.  The respondent was ordered to reinstate the applicant and pay lost wages.  The Authority felt that reinstatement went someway to assisting with the applicant’s distress and that $20,000 was a suitable starting point for compensation.  Taking contributory conduct into account the sum of $18,000 was awarded.

Toll New Zealand Consolidated Ltd v Rowe unreported, Shaw J, 19 December 2007, AC 39A/07

The defendant was employed as a locomotive engineer by the plaintiff.  He returned to work after being diagnosed with an adjustment disorder with a depressed mood.  About a month later, the defendant erred by driving his locomotive through a red signal (known as a “signal passed at danger” or a “SPAD”) and did not report it. The plaintiff was dismissed for serious misconduct in relation to the SPAD, failing to follow the correct reporting procedure, and denying the allegation when approached by his manager.

The Employment Relations Authority found the dismissal was unjustified. It determined the plaintiff had not acted in a procedurally fair manner and there was no reasonable basis to conclude the applicant had denied the SPAD occurred.  It also thought the plaintiff failed to fairly consider the potential impact of the defendant’s ill health on the incident.  The defendant was awarded nine months lost wages and compensation of $15,000, with the Authority noting his contribution to his dismissal.  The plaintiff challenged the substantive finding to the Employment Court and the defendant brought a cross-challenge alleging the plaintiff breached its health and safety obligations and disputed the level of contribution found by the Authority.

The Employment Court dismissed the plaintiff’s de novo challenge.  It considered the plaintiff’s finding of serious misconduct was substantively justified, except for the incorrect finding he denied the incident.  However the disciplinary process was procedurally flawed and undermined the decision to dismiss.  The plaintiff had not raised the issue of representation or provided the defendant with all the relevant information.  It also failed to get back to the defendant on the question of medical retirement.  The cross-challenge was granted in part as given its knowledge of the defendant’s health problems, the plaintiff breached its health and safety obligations by failing to implement a proper return to work programme for him

Factors the Court considered relevant to compensation included the defendant’s length of service, his age and medical condition.  The defendant’s self esteem and social life were linked to his employment and he was deprived of the realistic probability of a more dignified exit for medical retirement.  The Court awarded him one year’s lost wages and $25,000 compensation.  Both awards were reduced by 10 percent for contributory conduct.

Challenges to the Employment Court where the Employment Relations Authority awarded compensation*

Reynolds v Burgess unreported, Couch J, 2 March 2007, CC 5/07

The Authority awarded $2,000 compensation to the employee.  The challenge by the employer was dismissed.  The cross-challenge by the employee for interest was also dismissed.  However, as the hearing was de novo, all issues were at large, including remedies.  The Court increased the award of compensation to the employee to $4,000. (Authority determination: H Doyle, 27 October 2004, CA 129/04.  Included in 2004 Compensation table).

Eastern Equities Corporation Ltd t/a Farmers Transport Ltd v Bright unreported, Perkins J, 16 May 2007, AC 26/07

The Authority awarded $5,000 compensation to the employee.  The challenge by the employer was dismissed. The employee cross-challenge for increased remedies was partially successful but, after taking contribution into account, the Court also award compensation of $5,000.  (Authority determination: Y S Oldfield, 21 December 2005, AA 491/05.  Included in 2005 Compensation table).

Golden v Northland District Health Board unreported, Perkins J, 1 June 2007, AC 32/07

The Authority awarded $4,000 compensation to the employee.  The challenge by the employer was granted and the Authority’s compensation award was therefore set aside.  (Authority determination: L Robinson, 4 April 2006, AA 110/06.  Included in 2006 Compensation table).

Andrew Yong t/a Yong & Co Chartered Accountants v Chin unreported, Perkins J, 20 June 2007, AC 37/07

The Authority awarded $5,000 compensation to the employee.  The challenge by the employer was dismissed.  However, as the hearing was de novo, all issues were at large, including remedies.  The Court increased the award of compensation to the employee to $8,000. (Authority determination: L Robinson, 4 October 2006, AA 312/06.  Included in 2006 Compensation table).

Affco New Zealand Ltd v Nepia & Anor unreported, Shaw J, 28 September 2007, WC 25/07

The Authority awarded $8,000 compensation each to the two employees.  The challenge by the employer was dismissed.  The Court, therefore, also awarded $8,000 compensation to each employee. (Authority determination: P R Stapp, 26 April 2007, WA 59/07. Included in 2007 Compensation Table).

Nimon & Sons Ltd v Buckley unreported, Couch J, 5 October 2007, WC 26/07

The Authority awarded $10,000 compensation to the employee.  The employer’s challenge to the substantive finding was dismissed, but its challenge to remedies was allowed in part.  The employee’s challenge to remedies was dismissed except on the question of interest on lost wages.  The Court awarded compensation of $7,500.  (Authority determination: G J Wood, 28 March 2006, WA 49/06. Included in 2006 Compensation Table).

Gorrie Fuel (SI) Ltd v Gittoes unreported, Couch J, 8 November 2007, CC 21/07

The Authority awarded $8,000 compensation to the employee.  The employer’s challenge was unsuccessful and the Court also awarded $8,000 compensation. (Authority determination: P Cheyne, 2 May 2006, CA 58/06. Included in 2006 Compensation Table).

Chief Executive of the Department of Corrections v Imo unreported, Shaw J, 14 November 2007, AC 57/07

The Authority awarded $8,000 compensation to the employee.  The employer’s challenge was dismissed but the Court reduced compensation to zero to reflect the employee’s contributory conduct.  (Details of Authority determination prohibited from publication.  Included in 2007 Compensation Table.)

The Wellesley Ltd v Adsett unreported, Shaw J, 3 December 2007, WC 31/07

The Authority awarded $6,000 compensation to the employee.  The employer’s challenge was unsuccessful and the employee sought increased remedies.  The Court awarded $10,000 compensation.  (Authority determination: D Asher, 13 March 2007, WA 40/07. Included in 2007 Compensation Table).

B & D Doors Ltd v Hamilton unreported, Couch J, 18 December 2007, CC 28/07

The Authority awarded total compensation of $7,000 to the employee, $5,000 for his unjustified dismissal and $1,000 for each of his two unjustified disadvantage claims.  The employer accepted one of the unjustified disadvantage findings, but successfully challenged the dismissal claim.  The other disadvantage claim was substantively upheld but the Court reduced the compensation award to zero due to contribution.  Therefore, the total amount of compensation received by the employee was $1,000.  (Authority determination: J Crichton, 24 January 2007, CA 5/07. Included in 2007 Compensation Table).

Smith & Anor v Harvey unreported, Couch J, 18 December 2007, WC 10B/07

The Authority awarded $8,000 compensation to the employee.  Challenges by both parties were dismissed.  The Court, therefore, also awarded $8,000 compensation. (Authority determination: G J Wood, 9 October 2006, WA 132/06. Included in 2006 Compensation Table).

Toll New Zealand Consolidated Ltd v Rowe unreported, Shaw J, 19 Dec 2007, AC 39A/07

The Authority awarded $15,000 compensation to the employee.  The challenge by the employer was dismissed.  The employee’s challenge to remedies was granted.  The Court awarded compensation of $25,000, reduced to $22,500 due to contributory conduct.  (Authority determination: M Urlich, 12 April 2007, AA 107/07. Included in 2007 Compensation table).

*This section provides short summaries of challenges to the Court where the Authority awarded compensation.  This recognises the fact that an amount of compensation previously awarded by the Authority, and previously included in a compensation table, has been altered by the decision of the Court.