Can you fire an employee for a 'negligent' email?

An account manager sacked for a "negligent" email he sent to a customer has won nearly $30,000 after the Employment Relations Authority (ERA) ruled that he was unjustifiably dismissed by his employer.

Jonathan Taggart was an account manager for Carter Holt Harvey (CHH) LVL Limited, and was responsible for building and maintaining client relationships, as well as liaising with customers over pricing and manager demand, among other duties.

He was, however, fired in July 2021 after he sent a poorly worded email to a customer who was asking about a price on timber products in May - just two months after he was reprimanded for sharing embargoed information to a customer via email.

March 23 email ‘offence’

The first email-related offence took place in March 2021, when Taggart received instructions and a script on March 22 about answering customer questions regarding a market change.

The message was supposed to be embargoed until March 24 in the afternoon, according to the instructions.

When a customer, however, expressed to Taggart on March 23 their unhappiness about supply lead times "blowing out," the account manager sent the following response:

"You will hear some news tomorrow about a major move CHH is forced to make to try [sic] improve the greater CHH capacity challenges," he said in the email as quoted by the ERA.

"This will have a very good and very bad impact on the New Zealand merchant and construction market depending on partnerships and supply agreements. This information is confidential and will be released to the wider market on Wednesday."

Taggart was suspended on full pay pending an investigation for violating the embargo. The probe concluded with the account manager receiving a final written warning for serious misconduct.

May 28 email ‘shows lack of care’

On March 28, Taggart once again got the attention of his employer after he sent an email to a customer from PlaceMakers who requested LVL's "sharpest price" on a product.

Taggart's response to the question said: "Based on our current market position, competing on price is not something the business is any position to do. That said however, this is a quoted job in market and I am happy to honour the rates previously quoted in market with the February price increase applied."

According to his employers, they were concerned about how the Commerce Commission could interpret Taggart's response and suspended with full pay again pending investigation over the email.

"My preliminary view is that the email that was sent to [the Trade Sales Manager at PlaceMakers] was negligent, and lacked good judgment, showing a lack of care and attention to the message and its implications," Taggart's boss informed him on July 12.

"Regardless of your intent it had the ability to affect or potentially affect the good conduct of the business by suggesting that the Company was misusing its market power and engaging in anti-competitive behaviour."

His employer described the situation in the letter as "particularly disappointing," citing the final warning he received in March over email communication.

On July 15, Taggart received an email confirming his summary dismissal for engaging in "serious misconduct."

ERA's decision

The ERA ruled in favour of Taggart, concluding that he was unjustifiably dismissed by his employer.

Recognising that his dismissal considered Taggart's initial email blunder in March, the ERA ruled that his later email in May was not a similar incident.

"The March incident was a clear breach of a lawful instruction. The May email was not a clear breach of the disciplinary policy because it was not clearly anti-competitive, and no adverse consequences eventuated for LVL business," the ERA said in its ruling.

According to the ERA, the employer placed too much weight on the final written warning on the basis that the incidents were the same or similar.

"It was therefore not fair and reasonable for LVL to conclude that it had lost all trust and confidence in Mr Taggart to carry out his role based on the May incident," the ERA said. "The May incident was not serious misconduct warranting summary dismissal and therefore LVL was not substantively justified in its decision to dismiss Mr Taggart."

The ERA then ordered CHH LVL to reimburse Taggart for lost wages amounting to $16,399.78, as well as additional $13,500 as compensation for humiliation, loss of dignity, and injury to feelings.