EMPLOYMENT CASES SUMMARY March 2008 - NZ Department of Labour

Previous Section | Table of Contents | Next Section

Chang v Timeforall International Group Ltd

3 Apr 2007, L Robinson, AA 99/07, (4 pages)
UNJUSTIFIED DISMISSAL - No appearance by respondent - Applicant presented with letter purporting to change position from part time to casual - Applicant made it clear she did not accept change - Respondent persisted in offering applicant wages in lieu of notice in consideration for departure but she rejected offers - However, when became clear respondent did not want her to return she stopped going to work - Despite statement she would be called for casual work applicant never contacted again - Applicant's unchallenged evidence accepted - Letter constituted sending away - Applicant initially rejected repudiatory conduct but by subsequently not returning to she accepted it - Employment came to end at respondent's initiative and applicant did not consent to it - No fair process or substantive justification - Dismissal unjustified - ARREARS OF HOLIDAY PAY - Due and owing - Sales

Result: Application granted ; Reimbursement of lost wages ($4,560) ; Compensation for humiliation etc ($5,000) ; Arrears of holiday pay ($510.78)

Flynn v The Bacon Barn Ltd

8 Jun 2007, D King, AA 169/07, (5 pages)
UNJUSTIFIED DISMISSAL - Constructive dismissal - Applicant claimed unjustifiably dismissed by respondent - Dispute over whether offer to sell share of business - Authority accepted applicant believed had been offer to sell, but evidence did not support that perception - Respondent made number of requests for recipes applicant had created for job - At meeting applicant refused to disclose recipes until agreed to sell share in business - Applicant then gave letter of resignation, giving week's notice - Had meeting to discuss it - Respondent wanted to adjourn to enable applicant to seek representation but applicant refused - Respondent adjourned meeting anyway - Applicant believed had been dismissed - Respondents did not hear from applicant until raised personal grievance, despite attempts at contact - Not constructively dismissed - Tendered resignation - No breach by respondent to entitle applicant to think employment at end - Refusal to hand over recipes breach of lawful and reasonable instruction - Would have entitled respondent to dismiss him - No actual dismissal during notice period - COUNTERCLAIM - BREACH OF CONTRACT - Respondent claimed damages for removal and use of intellectual property, and damage to equipment - Insufficient evidence regarding damage caused by removal of recipes - Insufficient evidence applicant caused equipment damage - Small goods manufacturer

Result: Application dismissed ; Costs reserved

Hodgson v Parentline Charitable Trust

4 Feb 2008, J Scott, AA 28/08, (148 pages)
UNJUSTIFIED DISMISSAL – Constructive dismissal – Good faith – Applicant ran Parentline for 25 years before it became charitable trust and respondent formed – Applicant member of oversight group (“TRTK”) that had ability to remove Board members – Respondent decided to measure Parentline’s effectiveness – Psychologist (“ND”) contracted to design study – Shortly after engaging ND, applicant cancelled project and sought to terminate her contract – When respondent sought advice on legality of ending contract, applicant alleged poor performance – Allegations against ND unfair and unfounded – Applicant misled respondent as to true position – Applicant objected strongly when respondent confirmed ND’s contract and continued with project – Resigned in dramatic fashion and expected Board to attempt to convince her to stay - Resignation did not relate to alleged breaches of duty by respondent, also, applicant had affirmed breaches – No constructive dismissal – After respondent accepted resignation, applicant got TRTK to lobby it to reconsider - In normal circumstances, employer does not accept or reject resignation but merely acknowledges it – However, resignation made it clear applicant felt unfairly treated and had not simply decided to retire – No employer, acting in good faith, could ignore such missives – Required to engage applicant and inquire as to meaning of resignation, satisfy itself it was genuine and attempt to resolve issues – Simply accepting resignation amounted to serious breach of good faith and amounted to “sending away” dismissal - In circumstances, dismissal unjustified – Board compounded breach by not reconsidering resignation when it became clear applicant had changed mind, and by manner it took over management of Parentline - However, applicant did not communicate with Board or advise it she had reconsidered, as did not want to appear to be backing down - Not consistent with good faith obligations – Applicant acted as if had not resigned – Conspired with TRTK to remove board members and have herself reinstated as CEO – Demonstrated ulterior motives and multiple, serious and sustained breaches of good faith – Breaches founded on refusal to accept Board and its legitimate governance role – Adopted dismissive and confrontational approach in relations with Board - Breaches so blameworthy applicant disentitled to remedies, otherwise Authority would have awarded her $25,000 compensation and one year’s lost wages – Contributory conduct 100 percent - Authority took into account serious misconduct Board not aware of at time, but now subject of counterclaim – COUNTERCLAIM – Recovery of monies – Respondent sought to recover unauthorised salary increase and bonus paid to applicant – Board had not approved either payment – Applicant directed to repay monies – CEO

Result: Application granted ; Counterclaim granted ; Recovery of monies (Quantum to be determined) ; Costs reserved

Izett v Axiam Diecasting Ltd

15 May 2007, P R Stapp, WA 79/07, (7 pages)
UNJUSTIFIED DISMISSAL - Constructive dismissal - Applicant injured back - Off work with medical certificate - Respondent's policy required employees to obtain clearance for return to normal duties as no light duties available - Applicant returned to work but claimed only meant to do light or alternate duties and raised matter with health and safety officer - Returned to doctor and given further three days leave - Resigned same day - Applicant claimed had no choice if respondent unwilling to provide other work, and issues relating to alleged discrimination by supervisor and declined request for night shift in background - Initially ACC accepted coverage and respondent paid first week's earnings, although ACC later changed mind - Evidence fell short of establishing discrimination in workplace - No causal link between resignation and requirement to work normal duties when returned to work, or refusal of request for night shifts - Resignation voluntary and premature considering applicant had medical certificate and ACC coverage - Without assessment for rehabilitation, respondent within rights not to offer job rotation without breaching terms of applicant's employment - Although not clearly communicated, applicant aware of policy relating to light duties - Any defects in this regard would not constitute sufficiently serious breach for applicant to resign - Although health and safety officer could have been involved earlier in applicant's return to work, as applicant covered by ACC had options other than resigning - Applicant not able to establish forced to work with injury or respondent failed to meet health and safety obligations - No constructive dismissal - Linisher

Result: Application dismissed ; No order for costs

Kirkley v Ora Ltd

19 Feb 2008, M Urlich, AA 51/08, (36 pages)
UNJUSTIFIED DISMISSAL – Work related stress – Applicant claimed respondent failed to offer support when overworked and under resourced – Period October to December 2005 – Respondent on notice funding source being phased out – Security of employment made applicant apprehensive – Applicant claimed feeling tired, irritable and nauseous – Concerns not raised with respondent – No evidence applicant suffered from diagnosable illness – Staff informed of respondent’s plans to secure organisations future – Authority satisfied reasonable steps taken by respondent to support staff – Period January to February 2006 – Applicant appointed to new position – Applicant cancelled taking of annual leave because obliged to stay, however, also feared being made redundant – Confrontation with respondent owner where applicant shouted at and threatened with disciplinary action – Applicant accepted offer of sabbatical – Applicant found personal belongings boxed up without authorisation – Applicant “went out of control” as believed was subject to investigation – No evidence to support applicants claim that respondent aware applicant suffering from work related illness – Not-withstanding non-notification of workplace stress, respondent took steps to minimise applicant’s workload and stress issues – Applicant suspended – Applicant diagnosed with major clinical depression – Applicant advised respondent that exclusion of particulars from suspension notice causing her trauma and stress – Settlement proposal rejected – Applicant dismissed – Claimed applicant failed to maintain confidentiality of business information – Claimed pattern of unacceptable behaviour – Authority found issues not fairly put to applicant – Respondent failed to investigate applicant’s explanations – Respondent’s reasons for reaching decision wrong in principle – Dismissal unjustified – Remedies – Claim for lost remuneration for period after sabbatical declined – Causal link between ill health and employment not made out – Applicant prescribed antidepressants – Medical evidence that dismissal an impediment to recovery – Financial pressures faced by family – Contributory conduct 10% – Compensation $15,000 – Administration manager

Result: Application granted ; Reimbursement of lost wages (4 months) ; Compensation for humiliation etc ($15,000) ; Costs reserved

Li v Astral Management Ltd

15 May 2007, J Crichton, CA 54/07, (12 pages)
ARREARS OF WAGES - Applicant supplied two purported employment agreements - Second document operative agreement - Applicant to be paid salary, not wages as claimed - Alleged worked 1,516 unpaid hours - No wage and time records - Authority accepted records not required for salaried workers - More likely applicant did work some extra hours - No entitlement to additional remuneration pursuant to employment agreement and at no stage was applicant paid less than minimum wage - No basis for arrears claim or recovery of other sums applicant claimed entitled to - UNJUSTIFIED DISADVANTAGE - UNJUSTIFIED DISMISSAL - Evidence did not support any wrong doing by respondent to found disadvantage or constructive dismissal claim - Applicant absent for various periods at end of employment with only sporadic contact - Respondent's attempts to establish applicant's intentions resulted in it being warned off by applicant's friend - Applicant later returned key and removed belongings - Employment ended without resignation or indication applicant might return to work, however friend of applicant indicated she had new job - In circumstances, respondent could not be blamed for end of employment relationship - No personal grievance - Applicant's witnesses included two "secret" witnesses who gave evidence on footing identity not disclosed to respondent - COSTS - Normally costs would be reserved - However, applicant's financial means precluded her form making realistic contribution to costs - Costs to lie where they fall - Restaurant worker

Result: Application dismissed ; Costs to lie where they fall

Mathieson v Kaituna Pastoral Farms Ltd

23 Apr 2007, R A Monaghan, AA 116/07, (18 pages)
UNJUSTIFIED DISADVANTAGE - Respondent had number of concerns about applicant's performance - Applicant not promoted to manager as promised - However, failure justified to extent it took into account his unwillingness to carry out full range of managerial duties - Respondent did not seek response from applicant before issued performance warning, although applicant should not have been so dismissive of respondent's earlier informal approach - Seriously flawed procedure - Entitled to $3,000 compensation - Not persuaded promotion would have gone ahead but for warning and associated concerns - No further award appropriate - No basis for allegation applicant "harassed" to sign new employment agreement - Applicant also claimed disadvantaged when leave request granted and later withdrawn - Authority not persuaded amounted to disadvantage grievance - UNJUSTIFIED DISMISSAL - Constructive dismissal - Parties and representatives met to discuss employment problems - Suggestion applicant draft job description reasonable starting point for addressing issues - Applicant took view because unsuccessful in negotiating exit package during meeting matters at stalemate and employment over - Applicant became disruptive and uncooperative - Failed to respond to respondent's queries over several weeks or provide job description discussed at meeting - Further meeting resulted in applicant being demoted and required to report daily to manager - Applicant considered demotion a repudiation of employment agreement and resigned - Demotion repudiatory conduct - Circumstances amounted to dismissal - However, respondent had gone as far as it could in attempting to resolve issues between parties - Reasonable grounds to conclude applicant could not continue in role - Dismissal justified - ARREARS OF WAGES AND HOLIDAY PAY - Parties agreed applicant owed wages and holiday pay - Interest 7.9 percent - RECOVERY OF MONIES - Authority not persuaded parties agreed on costs associated with dogs or phone rental - Unclear how purchase of farm bike would be recognised - Applicant received higher salary than agreed and likely increase recognised purchase - No entitlement to additional payment - Applicant attempted to claim bonus on behalf of other staff - Not authorised to do this and no order made - Farm manager

Result: Application granted (Disadvantage, arrears) ; Compensation of humiliation etc ($3,000) ; Arrears of wages and holiday pay (Quantum to be determined) ; Interest (7.9%) ; Application dismissed (Dismissal, recovery of monies) ; Costs reserved

Miller v Nicholas Garden Group Ltd

10 May 2007, J Crichton, CA 51/07, (10 pages)
UNJUSTIFIED DISMISSAL - Applicant responded to advertisement seeking full time and casual employees - Application for permanent position unsuccessful - Several months later respondent contacted applicant to ask if still interested in working for it - Offered and accepted job - Claimed not told position casual - Worked variable hours according to monthly roster, averaging 42.5 hours per week - Roster later changed and applicant to work only 4-6 days per month - Respondent told him work seasonal and change happened every year - Applicant later told employment terminated as business quiet, and all causal employees hours reduced - Individual employment agreement ("IEA") contained job description stating position casual and subject to seasonal variation - Contention applicant knew or ought to have known casual employee because of IEA or nature of industry failed - Applicant had not seen job description before Authority proceedings - Had not worked at respondent during off season and had no extrinsic history to rely upon in relation to industry custom and practice - Clear intimation applicant appointed to permanent position - Applicant's employment permanent part-time with no fixed hours - Termination not consistent with IEA notice requirements- Dismissal unjustified - Remedies - Negative consequences of dismissal exacerbated by intemperate and truculent language of respondent in responding to applicant's attempts to address wrong - Entitled to lost wages for entire period out of work, but calculation not straight forward - Applicant submitted entitled to average wages earned during employment - Respondent argued lost wages should be abated to take account of reality hours would have been reduced during off season - Applicant also sought lost wages for period of reduced hours before dismissal - No evidence employment relationship during that period had soured and reasonable for respondent to maintain applicant provided with whatever hours available - Lost wages awarded on basis of four months of off-season hours, and three summer months

Result: Application granted ; Reimbursement of lost wages ($8,308.75)(8 months) ; Compensation for humiliation ($8,000) ; Costs reserved

Ringrose v Brazin Ltd and Bras n Things New Zealand Ltd

5 Feb 2008, Y S Oldfield, AA 31/08, (29 pages)
BREACH OF CONTRACT – UNJUSTIFIED DISADVANTAGE – Applicant claimed health harmed by workplace stress and respondent failed to provide safe system of work – On doctor’s advice took two weeks leave - Applicant required to start new operation from scratch with inexperienced staff – Job too much for one person – Excessive workload caused applicant’s health problems – However, risk not foreseeable – Claim for wages lost while on leave dismissed – UNJUSTIFIED DISMISSAL – Constructive dismissal – Applicant claimed when returned to work, workload remained excessive and subjected to unreasonable and bullying treatment by managers – Applicant given strict instructions to improve stores – Conflict with manager led to “counselling” about behaviour and investigation into alleged serious misconduct – Applicant resigned, claimed lost all confidence in manager and felt overwhelmed – Applicant clearly suffered harm – Harm and resignation direct result of pressure applicant faced upon return to work – Counselling sessions unfair – While more likely than not applicant’s tone “unprofessional”, in context manager should have seen reaction as sign of distress – To describe actions as serious misconduct out of proportion with gravity of error – Extent of demands broke applicant’s health while unreasonable nature of demands destroyed her trust and confidence in managers – Ill health and resignation foreseeable and direct consequences of treatment she received from managers – Rather than attempt to prevent further harm, respondent imposed additional and unreasonable demands – Serious breach of duty to provide safe system of work – Remedies – Very distressing experience for applicant – Diagnosed with reactive depression and unable to work for several months - $20,000 compensation appropriate – PRACTICE AND PROCEDURE - Dispute and counterclaim relating to applicant’s expenses reserved as neither party provided enough evidence for Authority to make determination

Result: Application dismissed (breach of contract, unjustified disadvantage) ; Application granted (unjustified dismissal) ; Reimbursement of lost wages (4 weeks) ;Wages in lieu of notice (2 weeks) ; Application reserved (Dispute and counterclaim) ; Costs reserved

Turchie v Prestige Ltd

26 Apr 2007, P R Stapp, WA 62/07, (11 pages)
UNJUSTIFIED DISMISSAL - Constructive dismissal - After period as temporary employee applicant appointed to permanent position - Performance concerns raised by manager - At subsequent meeting applicant alleged manager offered her exit package or she would face disciplinary proceedings which would result in her leaving anyway - Applicant left premises and did not return - No contact between parties and respondent continued to pay applicant for next two weeks - Respondent submitted applicant resigned when further performance issues raised - Respondent denied making exit offer and wanted applicant to return to work - Later asked applicant to sign standard resignation letter if wished to pursue decision to leave - Both parties had contacted original temp agency for help - Attempt by respondent to settle what it considered misunderstanding declined by applicant as not looking to return to workplace - Credibility finding in favour of respondent - Ulterior motive to replace applicant not established - Applicant had not proved faced with choice to resign or be dismissed - Raising performance concerns with applicant not unjustified - Respondent not responsible for applicant's decision to leave and its actions after she left consistent with desire to retain her - Applicant could have approached problem in constructive manner instead of raising personal grievance - Applicant resigned - No dismissal - PENALTY - Respondent failed to provide written employment agreement - Penalty appropriate - However, failure did not cause or contribute to employment relationship problem and respondent had arrangements in place for new employees to be provided with agreements - Penalty at lower end of scale ordered

Result: Application dismissed (Dismissal) ; Application granted (Penalty) ; Penalty ($500)(Payable to Crown) ; Costs reserved

von Tunzelman v Taylor & Anor

9 Jul 2007, L Robinson, AA 206/07, (7 pages)
PRACTICE AND PROCEDURE – Identity of employer – First respondent director of second respondent – Claimed only second respondent had legal relationship with applicant – Applicant previously employed by first respondent – Had no knowledge of second respondent, but accepted worked for publication – Applicant entered into and concluded negotiations with first applicant – First respondent never disclosed acting as agent – No written agreement – Doctrine of undisclosed principal – Applicant entitled to proceed against first respondent – JURISDICTION – Whether employee or independent contractor – Applicant claimed paid weekly retainer and commission – Respondent contended applicant not paid retainer but “advance” commission – Applicant’s evidence preferred – Applicant subject to significant control and integral part of operation – Applicant an employee – UNJUSTIFIED DISMISSAL – Applicant drinking with first respondent after work – Alleged told would need to find a new job and would not be paid commission – Applicant's attempts to contact respondent to clarify situation unsuccessful – Applicant’s evidence accepted – Dismissal unjustified – Applicant did not seek remedies - ARREARS – Applicant claimed owed outstanding commission – Respondent submitted not owed anything as did not earn any – Also said not paid because did not submit invoices – Statements inconsistent and Authority rejected contention applicant required to submit invoices – Applicant entitled to commission of greater of 10 percent of total sales, or $40,000 – Authority unable to determine arrears without sales figures – Respondents ordered to supply information

Result: Application granted ; Arrears of wages (Quantum to be determined) ; Orders accordingly ; No order for costs