'Her work benefitted the business, and she was paid accordingly,' said ERA
The daughter of a yacht brokerage company's director has been declared an employee at the organisation in a dispute handled recently by the Employment Relations Authority (ERA).
Tobie Erceg was engaged by Yacht Finders Global (YFG) to carry out work on its behalf starting October 2022 until her departure in December of the same year. But prior to this, she was already assisting her father, company director Gary Erceg, as early as April 2022 by sending emails on behalf of YFG to clients.
Erceg joined the organisation with friend Aidan Harvey, where they received the titles "Operations Director" and "General Manager - Sales and Marketing," respectively.
There was no written agreement or contract between Erceg and YFG for her role - but she expected to receive payment of $500 a week for sending emails and letters to YFG clients.
She began her role working from home and was supposed to transition onsite in December 2022.
Dispute over ‘demotion’ with job title change
The dispute began in a meeting in November 2022, where Erceg, who was not present at that time, saw her job title changed to "Customer Coordinator."
According to Erceg, she was not aware of the title change until she was notified by email on November 30.
She resigned the following month after Harvey and her father had a workplace dispute that led to her friend's departure. She said that she disagreed with how the organisation handled Harvey's case and left the company.
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Erceg and Harvey later filed a statement of problem against YFG in February 2023, but the latter withdrew it in August.
In the case, Erceg claimed that she was unjustifiably disadvantaged when she got "demoted" after her job title changed. She also claimed she was constructively dismissed by the organisation.
YFG's defence cites independent contractor
In defence to the dispute, YFG argued that Erceg was not an employee, but was an independent contractor.
The company also claimed Erceg and Harvey only made up the job titles they initially used.
It added that changing Erceg's job title did not cause her a disadvantage, stressing that she was not demoted nor suffered any "discernible disadvantage as a result."
According to company, the change was made because the initial ones were "inappropriate" and did not reflect the nature of the pair's work for YFG.
Erceg declared ‘employee’ by ERA
The ERA ruled that Erceg was an employee in the case, but dismissed the claim that she was constructively dismissed.
"There was no doubt Mr. Erceg had attempted to help his daughter financially by paying her for her work with YFG. However, this intention manifested itself into an employment relationship," the ERA said in the ruling.
"This was mainly due to Ms. Erceg being integrated into the YFG business. Her work benefitted the business, and she was paid accordingly for the work."
In dismissing her claim of constructive dismissal, the ERA said Erceg's departure was due to how YFG treated Harvey as opposed to her.
"It was also not sufficiently clear whether her decision was because of any action towards her by YFG," the ERA stated.
Unjustified disadvantage established
The ERA, however, established that Erceg had a claim for unjustifiable disadvantage.
According to the ERA, YFG's "unilateral decision" to change Erceg's job title without consultation was unreasonable.
"Although there was no material loss to Ms. Erceg, the concept of disadvantage caused by an employer's unjustifiable action is a broad concept and was not limited to material loss or demonstrable financial loss," the ERA stated.
As a result, the ERA said YFG should pay Erceg $5,000 for hurt and humiliation in respect of her unjustified disadvantage claim.