Employer didn't set 'billable hours target' for frustrated worker
The Employment Relations Authority (ERA) recently dealt with a case involving a senior data engineer and architect who was dismissed from his position due to redundancy after only a few months of employment.
The case raised important questions about the fairness of redundancy processes, particularly when new roles are created and then quickly eliminated.
It highlighted the need for clear communication between employers and employees about job expectations and organisational changes.
The worker was employed by a data analytics consulting company as a senior data engineer and architect in October 2022. He was well-qualified for the role, with a degree in computer science, a master's degree in information management, and over ten years of experience in data-related work in the IT industry in Korea and New Zealand.
However, just four months later in March 2023, he received a proposal to disestablish his position. The employer claimed the role was no longer commercially viable due to insufficient client work.
They stated that "the role of Senior Data Engineer & Architect was created to open up [the employer's] opportunities and possibilities within the data architecture world with our customers. This role has been in place for over 4 months now, with no client work achieved outside of internal [the employer] work."
The worker was shocked by this proposal, as he believed he had been completing all assigned tasks and working on internal projects as expected.
He argued that it was never clearly communicated to him that billing external clients was a key requirement of his role. The worker's employment agreement did not specify any billable hours target for him or his team.
Over the next few months, an extensive consultation process took place. The worker requested more information to understand the rationale behind the proposed redundancy. He questioned why his role was being reviewed after only four months and sought data on utilisation rates compared to other roles.
The employer provided some additional details, including utilisation rates and project information. However, the worker felt the information provided was insufficient. He argued that work he had done for sister companies should be considered billable client work.
In his feedback, the worker emphasised that his data engineering skills were fully integrated into the company's day-to-day work. He stated:
"[The employer's] claim temporary non-data engineering and non-data architect work was not available for [the worker] was technically incorrect given the significant skill overlap with his role and data-analyst and data-scientist."
This highlights the worker's view that his skills were valuable and could be applied to other roles within the organisation.
Despite the worker's objections, in May 2023 the employer confirmed the decision to disestablish his role. They then initiated a redeployment process, asking the worker to indicate interest in other advertised roles.
However, the redeployment process became another point of contention. The employer used the worker's original CV and work history to assess his suitability for other roles, rather than allowing him to submit new applications tailored to the available positions.
The worker felt this approach was unfair. As noted in the decision:
"[The employer's] approach to redeployment has unfortunately left [the worker] with the impression the decision had already been made that he was not suitable for the role."
The ERA ultimately found that the worker had been unjustifiably dismissed. They determined that the employer had not adequately engaged with the worker's fundamental concerns about the redundancy process.
The Authority stated:
"[The employer] cannot demonstrate it has engaged with [the worker's] fundamental criticism of its approach which stretched back through the employment relationship."
The ERA said that the employer failed to properly address the worker's key arguments against the redundancy.
While reinstatement was not deemed practicable due to the small size of the company and the data analytics team, as well as the erosion of trust and confidence between the parties, the ERA did award the worker compensation and some lost wages. The decision noted:
"It is accepted the impact of the unjustified dismissal has had a profound and negative impact on [the worker]." In explaining their decision on remedies, the ERA stated:
"[The worker's] dismissal was a no-fault redundancy and he did not contribute in a blameworthy way to the situation giving rise to his personal grievance."
The ERA ordered the employer to pay the worker $16,000 in compensation for humiliation, loss of dignity, and injury to feelings, as well as three months of lost remuneration less any accident-related earnings during that period.
