August – September 2022 Employment Law News and Case Roundup

October 5th, 2022 - Matt Belesky


Ditching the Protection Framework & Vaccination Mandates

From 26 September 2022 Government removed vaccination mandate requirements for certain sectors. This follows the Government ditching the Protection Framework (traffic light system). We aren’t completely out of the woods, however – some requirements continue such as the need to isolate for 7 days following contracting COVID-19 and to wear face masks at healthcare facilities. 

These latest steps by the government should prompt many re-employment discussions however, the reality is it probably won’t because matters generally tend to “sour” when one party ends the relationship unilaterally. 

Many employers will be relieved with the removal of restrictions, similarly, those employees that decided not to be vaccinated. Removal of vaccination requirements, as well as borders now being fully open, may assist some employers struggling to fill roles, especially in the agriculture and health sectors. 

Vaccination is now discretionary – employers requiring vaccination will need to be able to justify it with a health and safety risk assessment. With the changing environment, it is likely the risk assessment would have to result in a high risk of exposure, spread and impact to justify. The writer’s opinion is this is likely to be limited to health, disability, and aged care front-line workers. 

Extending Timeframe for Raising Personal Grievances for Sexual Harassment

The Select Committee heard submissions on extending the timeframe for raising a personal grievance for sexual harassment in employment from 90 days to 12 months. The select committee’s report is due back next month in November 2022. Watch this space. 

Changes to the Holidays Act 2003

The Government has accepted recommended changes to the Holidays Act 2003. This is anticipated to make it clear and more certain. Legislation to enact these changes, which are well overdue, has yet to be drafted but it is expected reform will take place in early 2023. 

New Zealand Defence Force Settlement Agreement

A former New Zealand Defence Force employee signed a settlement agreement and subsequently sought to bring a personal grievance for unjustified dismissal, seeking to set aside the full and final settlement agreement on the basis of ‘lack of capacity’. The Employment Court held that although a settlement agreement can be set aside on the basis of incapacity, the other party to the agreement must, or reasonably ought to, have had some knowledge of the incapacity at the time the agreement was entered into. The Defence Force in this circumstance did not. The Employment Court’s judgement was upheld in the Court of Appeal and has now been upheld in the Supreme Court (TUV v Chief of New Zealand Defence Force [2022] NZSC 69).

Successfully Challenged Dismissal

After 20 years of service, Ms Ashley was dismissed from her employment with NIWA for the reason of incompatibility. Dismissals for incompatibility have historically been rare, however, BuckettLaw is noting a growing trend of dismissals for incompatibility. Ms Ashley successfully challenged her dismissal in the Employment Relations Authority, where she was awarded $20,000 in compensation and three months lost wages (Ashby v NIWA Vessel Management Ltd [2022] NZEmpC 174). 

Ms Ashley appealed the quantum of the remedies awarded by the Employment Relations Authority to the Employment Court, seeking an uplift to $100,000 in compensation and lost wages to the date of the hearing. Ms Ashley was again successful, with the Employment Court uplifting the Authority’s awards to 12 months lost wages and $35,000. This appears to reflect a growing trend by the Employment Court to provide higher compensation and lost wages awards and could very well be an implicit signal for the authority to ‘keep up’ in increasing the lost wages award, the Employment Court placed significant emphasis on Ms Ashley’s long service, her good service, and the likelihood that she would have remained employed for some time but for the dismissal. 

Work-related Mental Injuries

Two former employees (guidance counsellors) of a High School suffered PTSD in the course of their employment. ACC declined to provide cover for their work-related mental injuries as it was not caused by a single identifiable event. ACC did however find they were work-related. The employees eventually accepted that decision and brought a claim against their former employer for allegedly breaching its health and safety obligations. The employer sought to argue the Employment Court had no jurisdiction to hear the claims, arguing the employees first had to exhaust their ACC appeal rights. The Employment Court disagreed, holding Parliament could not have intended for claimants to ACC claims to pursue all reviews and appeal rights “ad infinitum”. The Court of Appeal has now upheld the Employment Court’s decision, finding that the employees can pursue their claims in the employment jurisdiction. BoT of Melville High School v Cronin-Lampe [2022] NZCA 407.

Overturned Determination by the Employment Relations Authority

In Kang v Saena Co Ltd 2022 NZEmpC 151 the Employment Court overturned a determination by the Employment Relations Authority which found that two staff had not been dismissed and were therefore unable to pursue an unjustified dismissal claim. The Employment Court found it was reasonable for the plaintiffs to have understood they were being dismissed. There was a heated exchange between the parties which culminated in an instruction to leave the workplace. There also appears to have been a subsequent text exchange and job advertisement. 

The Court found the dismissal was unjustified, awarding the employee plaintiff $20,000 in compensation and lost wages. The decision in the writer’s opinion reflects a growing trend by the Employment institutes to lower the bar for what is considered a “dismissal”. 

As an employer, you should be very careful about ever asking staff to leave the workplace, particularly following a heated argument or altercation. Depending on the wording used, that type of statement could be reasonably interpreted as a dismissal. It is important to remember the test focuses on whether the employee claiming to have been dismissed could have “reasonably interpreted” what happened and what was said, as a dismissal. As a dismissal is generally defined as a “sending away”, often employers get themselves in hot water because an instruction to “leave” the workplace can be reasonably interpreted as an instruction to “leave and never come back” (a statement which is a clear example of a dismissal).  

We recommend always seeking legal advice well before a dismissal. Every dismissal should be communicated clearly, in writing, be for a justified reason(s)/cause(s) and follow a fair process. 

Unlawful Required use of Annual Leave

In E Tū Incorporated v Carter Holt Harvey LVL Limited [2022] NZEmpC 141, the Employment Court has held the employer unlawfully required staff to use their annual leave during the 2020 Alert Level 4 Lockdown. The Holidays Act 2003 is quite clear that an employer can force an employee to use their annual leave provided their first endeavour, in good faith, to reach an agreement with the employee and provide sufficient notice. More generally the employer must also not unreasonably withhold consent to an employee’s request to take annual holidays. Practically this means the employee rarely will be required to take annual holidays when it does not suit them. In practice, it ordinarily arises with an annual closure at the end of the calendar year. In this case, the Employment Court found the employer did not endeavour to reach an agreement, including because some staff took issue with the request and the employer subsequently failed to engage in a timely manner with those communications.  

Redundancy not Procedurally Correct

In BoT of Southland Boys High School v Jackson Ord NZEmpC 136 2022, the Employment Court has declined by an employer. The employer sought to appeal the lost wages award by the Employment Relations Authority to several staff that were determined to have been unjustifiably dismissed for reason of redundancy.

The redundancy was found to have been substantively justified/genuine, but procedurally not. Sometimes where redundancy is found to be unjustified on procedural defects alone, the Authority or Court may not provide a lost wages award. In this case, the Authority did. 

The Employment Court upheld the Employment Relations Authority. In doing so the Employment Court clarified, “redundancy payments do not extinguish the remedies of reimbursement for lost wages”. The Court did however qualify that it may be relevant to the award of compensation in that if a redundancy payment was made, it may have reduced the emotional harm suffered by the employee (see the Queenstown Lakes case). 

The employer attempted to argue that because there were redeployment options available the chain of causation between the unjustifiable dismissal and the employee’s lost remuneration was broken. The Employment Court disagreed, noting that it was reasonable for the dismissed employees to see ongoing employment as an unrealistic option following the unjustified process. The Employment Court held there is a “need for realism as to what can reasonably be expected of an employee facing the loss of their role in the midst of an unfair and predetermined process where the parties have become polarised”. 

Gloriavale saga

For those that have been following the Gloriavale saga going through the various Employment institutions, you may find it interesting to know that Gloriavale attempted to have the Chief Judge of the Employment Court recused from hearing a further proceeding against it. Previously Chief Judge Inglis found against Gloriavale (in Courage & Ors v Attorney General & Ors [2022] NZEmpC 77), holding that three former members of the Gloriavale community were in fact employees (not volunteers). That finding essentially undermines the entire Gloriavale business model and is likely to set a precedent for current and former members of the community to come forward and seek employee declarations and unpaid wages. Unsurprisingly, Gloriavale failed in its attempt to have the Chief Executive recused on the basis of alleged “apparent bias”. 

Employer Withdrew Accepted Job Offer

Kennedy v Field Nelson Holdings Ltd [2022] NZERA 421. The Employment Relations Authority released an interesting determination where an employee that had received a job offer conditional on receiving a positive response sought to claim he was an employee and had been unjustifiably dismissed after the employer withdrew the accepted job offer following a reference check. 

Ordinarily, when a job offer is made and then accepted from that point the individual is deemed an “employee” as defined by the Employment Relations Act 2000. This is because the Act specifically defines an employee as a person “intending to be employed”. 

Employers, therefore, need to be cautious if they are trying to cancel an accepted employment offer. If it is done without a justified cause, and without following a fair process, it could be an unjustified dismissal. 

In this case, the Employment Relations Authority found the individual was not an employee because the offer of employment was conditional on a satisfactory work reference, and it cancelled the agreement before the employee started work and after having conducted the reference check.

Ideally, an employer would complete reference checks before making an offer of employment, but this case demonstrates that isn’t necessary. Further, such an offer could be withdrawn lawfully if the offer is clearly and unequivocally conditional and the condition is exercised genuinely and before the employee commences work. 

Employee Unjustifiably Dismissed For Covert Recordings

In Curnow v Advanced Security Group (STH IS) Limited [2022] NZERA 359 the Employment Relations Authority determined an employee had been unjustifiably dismissed after having covertly recorded co-workers in the workplace while he was not present. It is potentially a criminal offence for one to covertly record another person if you are not present for the conversation, but not if you are covertly recording and part of the discussion. 

The covert recording raised significant trust and confidence issues for the employee as the core business of the employer was in electronic security. Although the Authority determined the finding of serious misconduct was one open to a fair and reasonable employer in this instance (essentially the Authority agreed there was substantive justification for the finding), the Authority found the employer’s process leading up to the dismissal was procedurally unfair. 

Employees covertly recording their employers, such as in disciplinary meetings, is commonplace. Although doing so may raise good faith issues, the Employment Relations Authority and Employment Court seem to have stopped short of finding the covert recording of the employer could justify a dismissal. What distinguishes this case is that a) the employee covertly recorded other staff b) the employee was not part of the conversations and c) at the time the recordings were taken the employee was not under any scrutiny by his employer in the sense of an investigation or disciplinary inquiry. Instead, the employee was gathering selective evidence to support a possible complaint. 

If you have any questions or are unsure of what responsibilities your organisation or business has do not hesitate to contact BuckettLaw

Note: BuckettLaw takes no responsibility for the consequences of any actions taken on the basis of our articles. Any views expressed or comments made in an article are the writers option only. The content in our articles does not constitute legal advice. If you need legal or expert advice you should obtain specific advice about your case or matter from a professional. For legal advice based on your individual situation please contact us to speak with one of our expert lawyers.

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Matt Belesky

Matt Belesky is an experienced employment lawyer providing practical and commercially focused advice. He has expertise in various areas of employment law, including disciplinary and performance issues, workplace investigations, and health and safety. Matt represents clients in mediation and court proceedings. In his free time, he enjoys exercise, film, music, and spending time with friends.

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