Good Faith - Employment Relations Act 2000
Forsyth v TelstraClear Ltd
15 Oct 2007, L Robinson, AA 320/07, (18 pages)
COMPLIANCE ORDER - GOOD FAITH - Applicant sought order requiring respondent to comply with alleged agreement for incentive payment - Respondent claimed no agreement as various conditions for payment not met - Employment agreement did not provide for bonus for partial year’s service - However, HR able to give approval for payment to applicant outside terms - On last day of employment details of bonus still being finalised - Manager submitted proposal to applicant, who asked that it be put in writing - Before he received fax applicant informed respondent he had given media interviews and articles would run following day - HR stopped fax being sent - Rescinded offer on basis it was conditional on compliance with employee duties and talking to media breached company policy - Conditions not expressly mentioned during negotiations - Payment entirely discretionary – Whether discretion exercised in accordance with good faith - Authority found HR vetoed payment yet parties discussed matter in terms of contract law - HR had not relinquished ultimate authority over bonus payment - Applicant aware discussion with manager could only result in recommendation and would require final HR approval - Condition offer be in writing came from applicant - As no letter sent, no actual offer made - Respondent’s concerns about articles real and genuine - Interview given while employee, date of publication irrelevant - Applicant should not have given interviews in circumstances - Initial proposal to pay bonus outside terms of employment agreement made in good faith - Applicant did not act in good faith as deliberately concealed media interviews and aware actions relevant to decision to reward performance - Parties agreed to discretionary bonus and not for Authority to interfere with exercise of discretion - HR veto of payment did not fall to be scrutinised by way of challenge to reasonableness - UNJUSTIFED DISADVANTAGE - Also alleged failure to pay was unjustifiable punishment and sought compensation - Exercise of discretion, not action by respondent - No personal grievance - Manager
Result: Application dismissed ; Costs reserved
